Andy's Blog

Most of you know that I recently bought a new car. While the first post on this focused on my sadness of leaving the old car, this post is hopefully going to be more helpful for those of you out there, like me, who have never bought your own car. I am calling this, lessons learned. This post is long, but I hope it helps.

If you are like me, the idea of haggling for the cost of something is not your cup of tea. When I lived in Jerusalem, you were always suppose to haggle for prices when you went to the market. I just paid full price. You would think someone who likes to argue as much as I do would love this, but I don't. Needless to say, I was not looking forward to this process.

The first two things I suggest anybody do when they are buying a new car are pretty simple 1.) do tons of research (more later on this point), and 2.) I don't care if you like the car and the price, no matter what leave the dealer the first time you talk to them. Do not take the car for the evening if they offer (which mine did). Make sure you make it clear that you will be buying a car soon (within the week) but leave the dealership. You want to send the message to them that you have absolutely no reason to come back. Trust me, this one step right here could save you $1,000s of dollars.

Now back to step one: do your research. Most people say this, but they confuse which research you should do. Most people say you should consult Consumer Reports to figure out which car you want. I don't care much about that. Most people know which car they want before they even start looking. The research I am talking about is price. And this is what I mean.

Two prices are usually thrown at you: MSRP and Invoice. MSRP is a joke. Unless your car is so unbelievably hot right now (like the PT Cruiser was when first released, or the current CRV is), you will never pay this price. Invoice is more tricky however. Car dealers will lead you to believe this is what the car costs them, it isn't true.

The best website I found regarding this was Fightingchance.com. They give you tons of free information and tips, and if you are willing to pay $35, they will send you the actual invoice cost of your car (exactly what the dealer pays). This is a huge help. Also, go to CarBuyingTips.com and download the Buyer's Offer Spreadsheet. This document is phenomenal and will walk you through what you need to do to submit and offer (they also have some examples).

Also, don't take Kelly Blue Book or Edmunds advice: it isn't worth anything and is frankly a better friend to the auto dealers than it is to the consumer. When concering your trade in value, do what the insurance companies know to do which is to consult NADA. This will give you a much more accurate representation of what your Used Car is worth - especially if it is in good condition (which mine wasn't).

Now when all done, you can do one of two things: 1.) FaxAttack offer a bunch of dealers (explained at Fightingchance.com) or 2.) if you are lazy like me, submit an offer to one dealership. You will get the better deal if you do FaxAttack, but frankly, I wanted a new car now and I thought I had a pretty good deal lined up. Click this link to view my PDF offer sheet.

Now I think I did pretty well my first time doing this, but I did get suckered in one area and it wasn't until I got home that I realized it. So I am going to explain this trick so you don't get suckered like I did. We agreed on the price of the car ($17,100) and we agreed on the trade-in value ($3,000). Taxes and fees are mandatory, which came to about $2,200. This amounted to about $16,200 waking out the door. Pretty good considering their first offer was $21,500 walking out the door - I talked them down $5,300! But then they got me. We switched the conversation over from price to car payment - and this is where I was stupid. I just assumed their numbers were correct. He told me the car payment would be $499 a month for 36 months and I believed him. What I didn't notice is that he slipped an extra $1000 bucks in there. The car, which I thought was $17,100, in the end was $18,100. Man I felt like an idiot. But lesson learned, never, never, never let your guard down. My mistake was assuming the negotiations were done and I could put my guard down. No siree.

When I e-mailed the sales person about this discrepancy (and supplied him the numbers in question), he told me he'd look into it, and then got back to me and told me the bottom line is my car payment is $499. I am assuming he wasn't disputing the fact he slipped and extra $1000 bucks in there. But he as right, the bottom line is my car payment is $499 and the other bottom line is that I am quite angry at this particular car dealership and salesmen.

One last thing. Your sales person will try and convince you to give him all "5s" on the phone survey that will certainly be coming your way. I am not saying don't do this, but it is important to be 100% honest. I gave some 5s on my survey (even though I am not a big fan of the dealership after this), but I also gave some 2s and some 3s as well. Be honest. It is more than just a survey. They use this to determine dealer compensation levels and other things. If you are unhappy, send the message that you like the car, but you hate the dealership - that's what I did.

All in all, I still feel ok. I walked out the door paying $4,300 less than they wanted me to originally, I learned a lesson, I got a new car, and I am happy. I won't go back to ***** ******* in *******, GA (email me if you want to know which car dealer I am not happy with) ever again (for service or sales), but I will always return to Honda.