How To Buy A New Car

[Texas Proud]

Well, hit a couple of hiccups....


First, they SOLD the car last night... do not know if this was intentional to get another sale or just crossed wires of when we agreed to buy and them selling... they have found a car like we want, but we have to wait till tomorrow to pick up...


Second, there is special financing available... which is what we wanted... however, if we go with the special financing they do not give you the $1,000 finance credit... IOW, you can get $1,000 off and pay 3.9% OR nothing off and pay 0.9%... we were going to go with the credit and refi but even that was more expensive than the low rate on such an expensive car...

Still got about $3K off sticker on a 2018 and nobody else was going that cheap...

 

[ncbill]

We have been in the market to replace our 10 year old Lexus. We were looking at ordering a 2018 Camry--a completely New car design.

Our local dealer purchases his inventories from Southeast Toyota Distributors --not directly from Toyota. The cars on their lot also a secondary window sticker with $1200 in paint sealant and floor mats--straight profit. And they are owned by a large chain of dealerships that adds $699 Documentation Fees which is all profit. Then they try to sell you Gap Insurance, Credit Life and Accident/Health insurance--back end profits. They attempt to get the customer on the front end, in the middle and on back end.

I consider this dealer to be a slam and jam operation with a high employee turnover. I prefer to do business with a locally owned less aggressive: (on my pocketbook) dealership.

I ordered a 2018 Camry Hybrid and paid $177 under invoice Out The Door. I drove an hour north to a family run dealership that doesn't purchase vehicles from an outside distributor.

We love the Camry hybrid and it is getting 52.5 mpg--manually figured.

Yes, the Southeast Toyota Distributors middleman mandatory markup has been discussed on many sites.

The solution is to buy from a dealer that doesn't buy from them, often by taking a one-way flight.

The leasing brokers on leasehackr [sic] could probably also help with such a purchase.

 

[W2R]

Well, hit a couple of hiccups....


First, they SOLD the car last night... do not know if this was intentional to get another sale or just crossed wires of when we agreed to buy and them selling... they have found a car like we want, but we have to wait till tomorrow to pick up...


Second, there is special financing available... which is what we wanted... however, if we go with the special financing they do not give you the $1,000 finance credit... IOW, you can get $1,000 off and pay 3.9% OR nothing off and pay 0.9%... we were going to go with the credit and refi but even that was more expensive than the low rate on such an expensive car...

Still got about $3K off sticker on a 2018 and nobody else was going that cheap...

So glad they found another car like what you want! Whew. What a mix-up. I hope that when you get to see it, it is exactly right in all respects. I am so picky - - wouldn't want too many test drive miles on it, wouldn't want the wrong color, wouldn't want different dealer add-ons, and so on.

 

[Texas Proud]

So glad they found another car like what you want! Whew. What a mix-up. I hope that when you get to see it, it is exactly right in all respects. I am so picky - - wouldn't want too many test drive miles on it, wouldn't want the wrong color, wouldn't want different dealer add-ons, and so on.

We will see... it should be very easy as it has to be the color my sister wants, both inside and out and 1 option....

If any add-ons, that is a bonus to us as we are not paying any extra for it...

 

[check6]

So how do you decide on the car before all this cunning wheely-dealing? Do you just read reviews and then buy over the phone or internet? At various times I thought the Fiat 500 and the Honda CRV were serious contenders for our garage - a couple minutes drive time changed my mind. Do you just go in and brave the sales staff at the dealership and test drive car after car? It took us hours just to drive a few different cars, and dealing with the upbeat, hopeful and eager salesmen wore me out during that time.

Go to a Mercedes or Porsche dealer. They just tossed us the keys and we drove their $60K+ cars without a sales person. With every other dealer we could not be trusted to drive their $25K cars alone.

 

[brucethebroker]

Go to a Mercedes or Porsche dealer. They just tossed us the keys and we drove their $60K+ cars without a sales person. With every other dealer we could not be trusted to drive their $25K alone.

Or contact the internet sales department of a local dealer. When you show up for a test drive, tell the smiling salesperson that you are dealing with the internet sales guys. That guarantees a quick cold shoulder...

 

[jazz4cash]

I stumbled upon a 2016 BMW 3 Series X drive with 46k miles for $4600 on TrueCar. I immediately locked in a "TrueCar Price Guarantee Certificate" despite the obvious mixup between miles and price. This was at midnight so the dealer emailed asking what time I could come in but then they found the error and backed out. Actual price was 35k.

 

[walkinwood]

The process in the OP works when the car in question is not in demand. I emailed all the Honda dealers around the front range. The delta in the pricing for the in-demand 2017 CR-V was all of 1.5% between the highest and lowest.

 

[GTFan]

Well yeah, that kind of goes without saying - don't buy the hot cars in demand if you want to save some money.

 

[Texas Proud]

The process in the OP works when the car in question is not in demand. I emailed all the Honda dealers around the front range. The delta in the pricing for the in-demand 2017 CR-V was all of 1.5% between the highest and lowest.

I think that also is because of lower sticker...


I am not sure that all were priced the same... IOW, I think some added in the loan credit and military credit and some did not.. or did not do one...

In the end we only paid about $500 more as they dropped some add on that they had on the first deal but forgot to put on the second... sis was happy with the deal.... I got her car cheap...


NOW, funny thing is that when I was driving today the horn just started to go off on its own .... called up sis and she said she might have honked it twice in 4 years... now have to do a trip to the dealership if it continues...

 

[rayvt]

The process in the OP works when the car in question is not in demand. I emailed all the Honda dealers around the front range. The delta in the pricing for the in-demand 2017 CR-V was all of 1.5% between the highest and lowest.

Huh. We just bought a Honda 2017 CR-V (highest end Touring model) after this thread started.

The price we paid was 6.1% under the highest quote. We did have to go to a dealer that was 50 miles further away.

 

[ohyouknow]

Here is a good article about dealer tactics: https://consumerist.com/2007/03/30/...ff-with-the-four-square-heres-how-to-beat-it/

 

[Bflotomny]

Will these techniques to obtain the lowest price work for a lease? My experience has been that all pricing goes out the window when lease is mentioned. This is because most leases are handled by the manufacturers finance arm.
Has anyone successfully negotiated a lease price. What were the steps involved?

 

[bobandsherry]

Will these techniques to obtain the lowest price work for a lease? My experience has been that all pricing goes out the window when lease is mentioned. This is because most leases are handled by the manufacturers finance arm.
Has anyone successfully negotiated a lease price. What were the steps involved?

Price (including any incentives), along with residual and MF rate are the blocks to the lease price. When I lease I don't focus on price, I instead focus on the payment. How the dealer gets to my payment doesn't really matter to me. I have found they want to keep prices near MSRP (less incentives), they then tinker with MF rate or residual.

I initially estimate lease payment (36 month/12K miles) to be around 1% or less of MSRP, e.g. $40K MSRP = $400. Any and all fees and taxes are wrapped into the lease payment, NO money down. My current vehicle had an MSRP of $45K, payment with tax is $405 which is 0.9% of MSRP. They also paid me $400 (check cut after the deal) to cover final lease payment I had on my prior car. And they also paid to have front driver/passenger windows tinted (I wasn't putting money to tint windows on car I don't own).

So with lease, focus on payment you want (target 1% or less of MSRP). Once you get desired payment then see what extras you might get.

 

[Texas Proud]

Price (including any incentives), along with residual and MF rate are the blocks to the lease price. When I lease I don't focus on price, I instead focus on the payment. How the dealer gets to my payment doesn't really matter to me. I have found they want to keep prices near MSRP (less incentives), they then tinker with MF rate or residual.

I initially estimate lease payment (36 month/12K miles) to be around 1% or less of MSRP, e.g. $40K MSRP = $400. Any and all fees and taxes are wrapped into the lease payment, NO money down. My current vehicle had an MSRP of $45K, payment with tax is $405 which is 0.9% of MSRP. They also paid me $400 (check cut after the deal) to cover final lease payment I had on my prior car. And they also paid to have front driver/passenger windows tinted (I wasn't putting money to tint windows on car I don't own).

So with lease, focus on payment you want (target 1% or less of MSRP). Once you get desired payment then see what extras you might get.

No money down is not available in Texas.... they want 100% of the taxes on 100% of the vehicle.... not the lease term amount...

I remember reading about people complaining that they are paying taxes for the next buyer.... in reality the state will tax them anyhow...

 

[bobandsherry]

No money down is not available in Texas.... they want 100% of the taxes on 100% of the vehicle.... not the lease term amount...

I remember reading about people complaining that they are paying taxes for the next buyer.... in reality the state will tax them anyhow...

Not sure about Texas, but you sure you have to pay taxes with money down? When I lived in Illinois they taxed at 100% of vehicle cost (has changed in past few years), but never had to pay the taxes upfront, instead just roll those into the total of the capitalized lease amount. You still can use 1% of MSRP as target monthly payment.

If you put any money down then subtract 1/36 of the money down from the 1% MSRP target payment. Example, if you paid $2,800 tax (money down) then subtract about $75/mo from the target payment amount.

 

[bobandsherry]

Just to point out, the 1% is a target rate I use. High demand vehicles will demand you pay more

However, slower moving vehicles can really be had for a bargain. As an example, I had priced a 2017 Chevy Equinox. MSRP was $29,975 (pretty basic) but had some great incentives. Had offer from dealer of $155/mo lease (36/12K) with $1,070 down, or net $185/mo - that was 0.06% of MSRP!

 

[REWahoo]

Not sure about Texas, but you sure you have to pay taxes with money down? When I lived in Illinois they taxed at 100% of vehicle cost (has changed in past few years), but never had to pay the taxes upfront, instead just roll those into the total of the capitalized lease amount. You still can use 1% of MSRP as target monthly payment.

Texas wants the taxes on the full price of the auto, not just the depreciated amount you "use up" during your lease term. This explains it: https://www.leaseguide.com/articles/texas-auto-lease/

I don't think TX requires up-front payment of taxes, just taxes on the full value of the vehicle spread across the term of the lease - even if that is only 12 months.

 

[Texas Proud]

Not sure about Texas, but you sure you have to pay taxes with money down? When I lived in Illinois they taxed at 100% of vehicle cost (has changed in past few years), but never had to pay the taxes upfront, instead just roll those into the total of the capitalized lease amount. You still can use 1% of MSRP as target monthly payment.

If you put any money down then subtract 1/36 of the money down from the 1% MSRP target payment. Example, if you paid $2,800 tax (money down) then subtract about $75/mo from the target payment amount.

I was told that by someone.... and I have not seen no money down leases being advertised.... so, not sure if there is a law (probably not) but in practice...

 

[Jerry1]

As has been said, with a lease, I focus on the monthly payment. However, in my leases, I buy extra miles. A typical lease for me was 2yrs, 50,000 miles. When you're driving a lot of miles, convert the monthly payment to a cost per mile. This doesn't work when you're leasing under standard terms (like 3 yrs, 36,000 miles or the low mileage leases of 10,000 miles per year). In those leases, it's all about the monthly payment because you go into those with the base assumption that you'll be at or just a bit lower than the allotted miles at lease end. When I drove a lot, in less than 2 yrs, I'd be at 50,000 miles and looking for an early buy out (roll forward). I was driving a nice Buick for just under 30 cents per mile. Not a bad deal given that Buicks have a 4yr/50,000 mile warranty, so I never had any other cost except for a few oil changes.

 

[HadEnuff]

That was very close to how I bought my last car (2015 Honda CRV AWD)

I got online and looked at what others were paying, then I contacted via email, the dealers in my State and asked them to give me a quote of their BEST price for the vehicle with these features. I got several and they were all over the place as far as price goes. I took the lowest of them into my local dealer and said, if you can beat this price I will walk out with a car today. I'm paying cash so don't worry your financial guy. They beat the price, although they had to bring a car from a different state that matched the color I wanted. No extra cost. When I checked the price I walked out with vs what others did, I made out on the very lowest end of the spectrum on vehicle cost.

I am currently working this exact angle on a 2017 CRV AWD, for the DW. She test drove the one she likes and they gave me an original "work up" which was basically the MSRP. Wow....what a deal! These cars must be moving well because at this moment Honda is offering zero incentives on it. So I've contacted a few other dealers in Western NY. One got right back to me with a $2000 better deal than my homie.
One wants to have my number because "my sales manager has some questions"...I said, "if he has some questions, he can email me the questions and I'll try to answer them, but it's a pretty simple deal here"...

The good news is that while DW likes the car, she is OK with walking away at this time if we can't get a little movement.
I emailed the local salesman, and told him what I was doing, and invited his dealership to participate, if indeed, they'd like to sell me the car. No reply yet.

This is actually a lot of fun, since we don't have any urgency.

 

[Texas Proud]

I am currently working this exact angle on a 2017 CRV AWD, for the DW. She test drove the one she likes and they gave me an original "work up" which was basically the MSRP. Wow....what a deal! These cars must be moving well because at this moment Honda is offering zero incentives on it. So I've contacted a few other dealers in Western NY. One got right back to me with a $2000 better deal than my homie.
One wants to have my number because "my sales manager has some questions"...I said, "if he has some questions, he can email me the questions and I'll try to answer them, but it's a pretty simple deal here"...

The good news is that while DW likes the car, she is OK with walking away at this time if we can't get a little movement.
I emailed the local salesman, and told him what I was doing, and invited his dealership to participate, if indeed, they'd like to sell me the car. No reply yet.

This is actually a lot of fun, since we don't have any urgency.

I had a thread about helping out my sister.... I sent emails to 39 dealerships.... I got back a bunch of crap about coming to test drive etc. etc... but I did get back 14 bids... I had left the last one to be the closest one... they actually came out with a good price but was just a bit higher than someone else... I said I got 2 cheaper than what he offered and they beat the price by $100...

Do not just email a few as that is not enough to get bids... make sure you give them all pertinent info so you can compare... I did not do this, but ask what rebates they are adding and make sure you qualify... this cost my sister $1,000 as we did not know the cheap interest rate meant you did not get the $1,000 rebate... it was well worth getting the cheap interest rate...

 

[HadEnuff]

I had a thread about helping out my sister.... I sent emails to 39 dealerships.... I got back a bunch of crap about coming to test drive etc. etc... but I did get back 14 bids... I had left the last one to be the closest one... they actually came out with a good price but was just a bit higher than someone else... I said I got 2 cheaper than what he offered and they beat the price by $100...

Do not just email a few as that is not enough to get bids... make sure you give them all pertinent info so you can compare... I did not do this, but ask what rebates they are adding and make sure you qualify... this cost my sister $1,000 as we did not know the cheap interest rate meant you did not get the $1,000 rebate... it was well worth getting the cheap interest rate...

I have found several dealerships that have websites introducing their sales "team", including an "internet sales" member, but don't have an email address anywhere on the site.

 

[Texas Proud]

I have found several dealerships that have websites introducing their sales "team", including an "internet sales" member, but don't have an email address anywhere on the site.

I used the company website with the find a dealer near you which had a contact dealership email for every one.... and yes, I had to send a separate one to all of them... but, I did a cut and paste so it did go by pretty quick...

 

[HadEnuff]

I am finding that about half of the Honda dealerships in Western NY do not have emails listed on their websites. Pictures of the sales staff and only phone numbers, no email to be found anywhere.
I am thinking that they just don't want to deal with buyers who want to use this approach.