Saturday, August 25, 2012

How I Bought My Car

I've had a few family members ask about this, so I thought I'd just let the whole world have at it.

Here's how I bought my Hyundai.

  1. Figure out EXACTLY which car you want, including trim, options, color, etc. I used Consumer Reports Car Buying Guide (primarily) plus,, manufacturer and other sites for features and reviews to narrow the category, then test drove around 5 cars. If Consumer Reports didn't give it their "recommended" rating (or whatever it was) it wasn't something I'd consider. 
  2. Find out what other people are paying via Internet posts and settle on your goal price. For mine, I looked at the lowest somewhat common price range and dismissed any outliers. This is around the lowest you could pay and should be your goal price. I looked in a few places, but for my Hyundai the best place was a Hyundai-specific forum, specifically this:
  3. Find out if there are any recently expired or recently added rebates or other incentives. These could alter your price goal if they weren't included in the prices people reported paying on the Internet. 
  4. Get a firm no-haggle price, just for reference. This is the max you could possibly pay. For this I used TrueCar (I think) and BJs, or maybe CarsDirect. It was $1500 or more greater than my goal price. 
  5. Get financing if you need it. My credit union offered 2.99% APR. This is critical because some dealers offer low or zero percent financing -OR- a rebate, but not both. If you have your own financing, you can get the rebate *and* a low APR. Having your own financing also takes off the pressure when the financing guy is getting his claws into you at the dealer. 
  6. Contact dealers online ONLY, no phone calls. Just email. Make sure they have YOUR car in inventory. Tell them that you are going to buy the car, but only from the dealer with the best price. Tell them to make you an offer that includes everything - all fees, extras, add-ons, etc, except for tax, tag and title (these will be the same no matter where you go). Play them off one another. You should get close to your goal after two or three rounds, eliminating all but one or two. If you're not there yet, tell them what you'll pay and first dealer to match that price gets your business. Now you can talk on the phone if you need to. If they ask about a trade-in, tell them you haven't decided yet (even if you have - this is a separate transaction and it's none of their business). If they ask about financing, tell them you'll take the best deal and if it's theirs then they get the financing business too (even if you're paying cash - you could always take 0% financing and put the cash in an interest-bearing account). 
  7. Once you're settled on a price, ask again to confirm that the only additional charges are statutory (tax, tag and title) because this is where they like to "forget" about the $500 documentation fee. Let them know that if you go to sign the paperwork and see an extra cent in fees, you'll leave immediately and not come back. If you have arranged financing in step 5 you'll probably need the dealer to send you a "Buyer's Order" so you can get the final approval from your bank/credit union (even though you may not actually need to use their financing). 
  8. If you are going to trade, find out what it is worth (, using the trade-in value) and be honest about it when you do the research. You might also want to look at AutoTrader to see what people are asking for your car (same model, year, trim, miles) just so you know the margin on it. 
  9. Make an appointment with your salesman (you'll be on a first-name basis by now) and go to the dealer. Make sure everything is as you negotiated on the new car. The numbers should match to the penny before statutory fees. Walk out if they try to pull a fast one....They'll chase you most likely and make it right. 
  10. Negotiate your trade (if any) and try to get at or above the trade-in values you found in step 8. This is where I got anxious. I could have done maybe $200-400 better on my trade, but in the grand scheme it was small potatoes. 
  11. Go see the Finance guy... If his deal is better than your bank/credit union, take it (I did) but don't forget to consider any rebates they offer in lieu of low rates. For example a $1500 rebate + your credit union's 2.99% APR may turn out to be a better deal than the dealer's 0% APR but no rebate. Be sure you're always comparing apples-to-apples on the length of the loan and not be just looking at monthly payments. 
  12. Enjoy your new car.