I wanted to do a separate post on negotiating for the car because this was something I was totally intimidated by before we went out and looked. Things that I think really helped me:
1) After going to look at the car the first time, we went to lunch and I looked up some info on the car on my iphone. Primarily Kelly bluebook values and consumer reports. This helped me know what the car was worth and made me feel like I was getting a good deal.
2) Willingness to walk away. I l-o-v-e-d this car. It had way more “stuff” than I would have ever put into it myself, but that doesn’t mean I wanted to pay for all the extras. I had a budget and I made a deal with myself that if I could get the car for what I could afford it was meant to be. If I couldn’t, it was not meant to be and I’d walk away, no regrets.
3) Shop your financing rates. The dealership was offering 5.5% for excellent credit, but my dad’s credit union was offering 3.75% for members and members families. Because we knew that, it took approximately 20 seconds for them to beat the credit union’s offer and give me 3.49%, meaning I saved myself 2% by doing almost no work.
Now the details:
The car was an AMAZING deal for what it was, but it was still a little more than I wanted to pay. Sticker price was about 900 over what I wanted to pay out the door (which would include taxes, title, fees). Including all of those things, we were about 2300 off in price. So I decided I’d stick to my guns and leave it to fate.
I told the dealer what I wanted to pay, out the door. He tried to tell me about their pricing matrix blah blah blah. I stuck to my guns: I will pay X. I’m not saying the car isn’t worth more… but I can and will only pay X. This is not a negotiating tactic where we’re going to go back and forth, that is my bottom line. If you can work with me I’ll stay and we can talk. If not I’ll leave.
He asked me to stay. They came back with a price of X + $800. I told him I’d pay X. He tried the salesman standard: Haven’t I been a good guy? Haven’t I been working with you? You really need to help me out here… I’m a nice person.
I was undeterred: We are not friends, this is business. I wasn’t kidding when I said I’d pay X. That is what I will pay and that’s it. You’re wasting my time.
They came back again… X + $500. Come on what is $500?
Sorry… not good enough. Thanks for your time. See ya later.
And then they did it… “If we sell it to you for X you’ll sign right now?”
Give me a pen. I got the car for EXACTLY what I was willing to pay for it and I did not have to come up from my offer a penny. I’m sure that it won’t always work this way… but for me it did.
The next round was over the “extras.” When my parents left to get my car to trade in, I was left at the dealership for a bit over 1.5 hours with not much to do. And lots of time for them to try to upsell me. Care package? No thanks, I live 2 hours away. Laser etching? Um… no. Lojack? Pass. Extended warranty? well….
Warranty was the one thing I was a little concerned about. Toyota makes fantastic cars (ahem… usually) but their standard warranty is 3 years/36,000 miles. With 35,000 miles on the car, I really didn’t have a warranty. Due to RAV4′s reputation I wasn’t too worried, but it was a bummer.
The offer on the table was for an additional 3 years/36,000 miles on top of what the car already had, for $1500. It seemed like a decent price but I wasn’t sure. I called B and he said to pass… he couldn’t imagine we’d need to put more than $1500 in repairs into my car in the next 3 years and he didn’t think it was worth it. I still wasn’t sure. When my dad got back with my car to trade in, he looked at the deal and felt it was pretty good. He said I could go either way… that it was really a comprehensive warranty and a good price, but it was my call. My big issue was that there was a $100 deductible per incident. So every time something goes wrong I have to pay $100? Plus I already paid the $1500? Meh…
They just about had me talked into it when I got an amazingly well-timed text from B. He found a warranty online that was only $600. It was the leverage I needed to tell the man no, I’d look online for my own warranty. That was when he sweetened the deal.
What if I was offered a 3 year/36,000 mile warranty with 0 deductible (i.e. I never pay a dime for whatever happens to my car during the warranty period), and GPR (guaranteed price return)? GPR means that if I never use the warranty, I get all but $50 back. So if toyota lives up to its name and my car doesn’t have any major repairs in the next 3 years I’ll get a check for $1450 and will have only spent $50 for the peace of mind. Sold!
Plus, after he made the deal he realized they can only do GPR on 4 year/48,000 mile warranties but since I’d already signed the papers he had to live up to his end of the deal! End result is that I get a 4 year/48,000 mile warranty with 0 deductible for $1,500 and GPR if I don’t use it. Amazing? Um, yea!
Moral of the story? Negotiate and stick to your guns! I got exactly what I wanted for exactly what I wanted to pay for it. Willingness to walk away was definitely my biggest ally… but something tells me even if I REALLY wanted that car enough to pay more I could’ve walked away and come back the next morning and gotten the same deal.
And next time I need to buy a car? I won’t be nearly so nervous about it. Buying a car is just like anything else– a business. They aren’t going to sell you a car for so low a price that they’re not making any money (despite what they might tell you), so don’t feel bad about lowering the price. And I won’t be scared to walk away. If X + $800 was really their bottom line, I bet I could’ve come back the next day and got that deal. Sure they might say “this offer is only good today”… but if they can make the deal today they can make the deal tomorrow and if I show up ready to sign I’d like to see a salesman actually turn me away.
Just one person’s experience… but for me, that was how I got my car!