Used Car Buying Negotiation Techniques
Make the most of your car buying experience by learning to negotiate with used car sellers.
What You'll Find Here
- Used Car Buying Rules
- Used Car Negotiation Tips
- Two Negotiation Tactics
What follows are some fundamental rules that we suggest you follow if you want to be successful in buying a used car and reducing your risk.
Used Car Buying Rules
Rule #1
Do Your Homework
Before you begin to seriously negotiate you should have the following information:
- You should know what the same make and model in the same condition is bringing at the dealer auctions. This is the wholesale price. See The Car Smart Shopper.
- If you're buying from a private seller, you should have some idea of what the same make and model is bringing on the retail market.
While it's true that a private seller can reasonably expect to sell his or her car for more than they would get from a dealer, it is also true that the car should be priced below the average retail price. Unless the car still has some factory warranty, the private seller is selling the car AS IS. Once you sign the check, it's your car and your problem. One of the risks of used car buying. - Before you agree to buy a car from a private seller or a dealer, be sure to use the car buying check lists we have provided in the section titled Evaluating a Used Car. If it passes your inspection, then have it inspected by a certified mechanic before you negotiate and certainly before you agree to buy it.
Note that if the used car is being sold by a dealer as a Certified Used Car and the certification is backed by the factory, then your inspection should focus on the features and amenities in the car. Make sure it has all the bells and whistles that you want and need.
If the car does have "problems" - through not significant ones - and you really want that particular car, you should get an estimate for the repairs and either have the seller repair the car or - once you have an agreed upon price - insist that the repair cost be deducted from the negotiated price.
The seller may get a little testy when you insist on his covering the repair cost, but remember who will have to pay for the repairs once you've purchased the car.
Warning: If you're buying from a dealer who agrees to make the repairs, be sure to see the completed work order. We know of cases where the work was promised, but never done. - Finally, a used car buying must, run a CarFax report on the car. Even if the used car is certified it's nice to know where it's been since it was driven off the lot as a new car. For uncertified cars, the CarFax report can provide the assurance that the title is clear and that the car has not been in a serious accident, flood or other disaster that may effect the cars performance and actual value.
Rule #2
Plan your car buying strategy ahead of time.
Having completed the steps in Rule #1 decide on your top price and then begin your negotiation at least 20% below what you're willing to pay.
Rule #3
Have the Money in Hand (Figuratively speaking)
One of the keys to buying cars for less lies in having the ability to "write a check" on the spot. "Cash in hand" always gets a seller's attention.
In some dealerships, as has been pointed out in several places on this site, dealers are delighted to have you finance the car because they get a cut of the interest. Certainly with private sellers, money in hand speaks loudly about your intent.
Rule #4
Be Flexible
While you may have a make, model, year and color in mind when you begin to shop, it's a good idea to remain flexible. Great deals don't always arrive exactly as you envisioned them.
Rule #5
Be Patient
Often to get a truly great deal, you have to be patient. If you find yourself in a situation where you're more anxious to buy than the seller is to sell, your chances of buying "cheap" are between slim and none. The key to finding a really good deal is being in the right place at the right time and that requires both persistence and patience.
Rule #6
Be Prepared to Walk from the Deal
If it doesn't feel right, if something seems amiss, if your "gut" seems to be telling you that your prospective purchase is a mistake ... walk away. You can always find another car.
Used Car Buying Negotiation Tips
Be Non-Combative: Make up your mind to be pleasant, friendly and non-combative. It is very hard for a sales person or a private seller to play hard-ball with a "nice person" who simply refuses to be hassled or pushed into a hasty car buying experience.
Never Divulge What You're Really Willing to Pay. If you are on a dealer's lot, one of the first questions the sales person will ask is "What are you looking to spend?" If you have not as yet settled on a car and are "just looking" you might find it to your advantage to give the sales person a price range.
If you're dealing with a private seller, couch your questions regarding price so that he or she knows you have no intention of paying his asking price. Use phrases like: What do you think the car is worth? What are you looking to get? If we could make a deal today (contingent upon inspection) what would you be willing to take? Force the seller to make the first commitment on price.
Inflate Your Actual Price Range: When you're shopping on a used car lot, and the sales needs to know what you're looking for, he will no doubt ask "what are you looking to spend?" Give him a figure of about twenty percent higher than you're actually willing to go.
The reason is because any car the sales person shows you is going to be priced about twenty percent above what the dealer is willing to take - especially if it's the end of the month or the car has been on the lot for more than six weeks. Better to start with "more car" and work to get the price down to your target amount than to start with less car at your target price.
Negotiate With a Smile: When it comes to car buying from dealership sales people, keep in mind that one of your most effective tactics is to always be pleasant and remain calm. There is nothing more difficult than dealing with a person who cannot be intimidated, rushed, pushed or panicked. It's very hard to negotiate with nice people who simply refuse to negotiate.
Be Prepared for a Rejection: Once you've made an offer to a used car salesman, you may hear, "your not being reasonable," or "you've got to meet me half way" or "my boss will never let the car go for that."
If it's a private seller you may hear, "I was really hoping to get more than that," or "I've still got to pay off my loan," or "This is a cream puff and it's worth a lot more. Plus, it's only got highway miles on it." (Hey, miles is miles.)
In either case, your response should be accompanied with a sad, disappointed smile when you calmly say: "That's the best I can do. I sure am sorry to have wasted so much of your time. I mean I know you want to sell the car and I'd like to buy it, but we're just too far apart on our numbers." And then say nothing. Remember, no seller - if they have any sense - wants to see a checkbook get back in his or her car and leave.
At the same time, you need to remember that unless you're looking at some exotic, classic, never-to-be-seen-again car, there are always more used cars on the market at any given time than there are buyers. Except when it comes to the "high demand" cars, it's always a buyer's market.
Be Willing to "Walk Away." Be nice. Be polite. In fact, if you're up to it, feign some personal pain that you were unable to make the deal. As you walk away, walk slowly. Take your time getting off the lot. Chances are the sales person will make one last attempt to reach an agreeable price.
Two Car Buying Negotiation Tactics
Click on the following for two car buying negotiation tactics that we've found to be useful.
Tactic 1 The Negative Walkaround
Tactic 2 Call on Lasts Month's Classified Ad
