Beating Broke

Personal Finance from the Broke Perspective

Haggling or No Haggling When Buying a Car?

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Recently, for the first time in 12 years, my husband and I found ourselves in the market for a car.  My husband hates negotiating, so the chore of haggling for a car fell on me.  I had the misguided notion that the Internet would make price negotiation easier, but that assumption was wrong.  Instead, I found that negotiating the price of a car is harder now than it was 12 years ago.

There is definitely something to be said for car dealerships like CarMax that tote a no haggle price.  But which is better?  Haggling with traditional dealerships or going with a dealership that doesn’t play games?

For us, the answer was the latter.

We started our car search ready to haggle and get a good deal.  Instead, all we got was frustration!

The Frustration of Haggling

Haggle or no Haggle when buying a car?
Should You Haggle for a Car?

We religiously searched the Internet to find cars in our price range.  We found one, called to confirm it was still there, and then made the 45 minute drive only to find out it had been sold.  I doubt if it was even there when we called, honestly.

Next, we went to another dealership, this time two hours away, to snag a good deal that we found online.  However, unbeknownst to us, the dealer had an advertised Internet price, but below it, he had a disclaimer—plus dealer fees and extras.  Well, the dealer fees and extras ended up being $2,700 more than the advertised price.

Still, we wanted the car, so we tried to negotiate, but they would not budge much.  After a few rounds of haggling, they were only willing to knock $1,500 off the dealer fees and extras, which would have had us paying $1,200 extra beyond the Internet advertised price plus the fees for the plates, taxes, etc.  No thanks.  Of course, once we drove home, they called us and were willing to negotiate some more.  They still wouldn’t agree to the price we wanted, and we didn’t want to drive two hours again to get the car.

By this time, we were fed up with our car search and the sales people’s tactics.

No Haggle Dealerships

Back we went to the Internet.  A week later we found a car that was a good deal.  We called that dealership and asked the important questions:

Is the car still available?

Do you take any extra fees on to the advertised Internet price?

Yes, the car was available, and no, there were no additional fees.

We loved the car, and after our weeks of searching, we knew it was a good deal.  The salesman almost immediately offered us an additional $600 off the advertised price, but he wouldn’t negotiate after that.  That put the car right in our price range, and we happily took it.

If you like to haggle, that might be the right technique for you.  However, I found the process this time to be very frustrating.

I’d much rather give my business to a dealership that prices the car appropriately (we checked this before we actually saw the car by checking the Blue Book price) and that doesn’t play number games.

Have you bought a car recently?  Did you haggle, or do you prefer to use a dealership that doesn’t play games? 

Selecting the Best Used Car

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Buying a car is, possibly, one of the most important investments you can do. For this reason, there are multiple steps you should consider, before making your decision. We hope our guide to selecting the best used car will help you to accomplish that.

Establish a budget

When establishing a budget for buying a used car, it is important that you take into consideration the charges that come with insurance, registration, maintenance and running costs.

Do your research

After settling how much you can afford to spend, you can start doing your research. And it’s genuinely important that you allow yourself plenty of time to get acquainted with the prices on the market. For instance, if you want to convey the market’s price of a car that you have in mind, try looking on the Internet for various used car ads.

If you stumble across a car whose price is much lower than the market price, you should be wary – the car may not be as good as the owner claims it to be.

Select the car

As you’re in your quest for finding the ideal vehicle, we recommend that you read plenty of reviews for the car you wish to purchase. Plus, always consider checking whether the newest model of that car is soon to be released – this can help you to haggle on the price.

Contact the seller

Now this is when all the fun begins. When you finally found the car, and you think it’s right for you and your needs, you should contact the seller. Don’t be intimated to ask plenty of questions, you need to find out as much as possible about the vehicle so that you know what you’re paying for.

Consider asking about the amount of time the seller has had the car, the reason he/she is selling it, if it suffered any accidents or serious damage, its condition and whether it will meet an RWC or not. Also, pay attention to the seller’s reactions to the questions. Body language can also indicate whether he/she is reliable or not.

If you’re buying the car from a private seller, we recommend that you meet at his/her house. The seller’s personal information should coincide with the ones on the registration certificate.

Check the car’s record

Even though you might believe that the seller is reliable and honest, that doesn’t mean you should take his/her word for it. You need to make sure that the car isn’t stolen, or encumbered. For this reason, please consider getting its VIN and check the state in which it’s registered.

Verify the car thoroughly

Besides personally checking the car, you should consider having it checked by a mechanic. This move can help you save thousands of dollars and prevent you from making a bad investment.

We recommend that you verify the car in daylight so that you can have a good look at all its possible defects – signs of rust or previous accidents. Take a good look under the car, inside the car, and at the tires. It’s equally important to inspect the engine for any signs of leaks or exhaust fumes.

5 Strategies to Buy a Used Car without Being Scammed

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Besides your home, one of the biggest expenses you will face is purchasing a car.  Unlike a home, cars do not appreciate.  They are a depreciating asset that lasts for a finite period.  Choosing the correct type of car within the price range you can afford can have long lasting consequences on your finances over the years.

John (name changed) is a 21 year old college student.  He was in the market for a new-to-him car, but he knew he didn’t want a car loan.

He found the perfect deal on Craigslist.  The car was listed for $9,000, but John knew that it had a Kelley Blue Book value of $12,000.  John met the owner, went for a test drive, and paid $9,000 in cash.  John was proud of his deal—until he went to transfer the title and learned the great deal he had just bought was a stolen vehicle.

Now, John, the smart student who didn’t want to go in debt for a vehicle, is out $9,000.

Everyone knows that dealer prices for used cars are usually at Blue Book value or higher, but the up side is that if you buy from a dealer, you don’t have to worry that the vehicle is stolen.

But what should you do if you want to find a good deal and don’t want to rely on a dealership?

Used Car Scammed
Original Photo via John Lloyd on Flickr

The investigator on John’s case recommended taking these precautions:

Try to buy used vehicles from family or friends.  The best thing you can do is buy a used car from family or friends who are upgrading their vehicles.  You know that the vehicle isn’t stolen, and you also have a good idea how well the vehicle was maintained.

Be wary of a good deal that is significantly below Blue Book value.  If a seller wants to sell a car for much less than it’s worth, be suspicious.  In this case, you should think of the old adage, if something seems too good to be true, it probably is.

Don’t trust a seller who only has his cell phone number as his means of contact.  If the seller won’t give you any personal details or ways to contact him besides his cell phone, he may have something to hide.

Run a CARFAX check.  Running a CARFAX is a good idea no matter where you’re buying the vehicle.  A CARFAX will tell you how many owners have had the car, whether it’s been in an accident, how it was maintained, among other information.

Run a VIN check.  Using the free service VINCheck, you can see whether or not the vehicle you’re considering buying has been stolen.  Had John done this, he would have been tipped off immediately that something was not right with the vehicle he wanted to buy.  As it turns out, his vehicle had been shipped down to Mexico where the VIN was altered.  The vehicle was then brought back to the U.S.  When John went to register the title, he discovered that the VIN he had did not exist.

Buying a car from a private party can be worthwhile and save you money if you take the proper steps.  If you don’t, you could find that the bargain you purchased was actually a very expensive lesson.

Have you ever had trouble buying a vehicle from a private party or know someone who had trouble doing so?