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7 Car Sales Secrets You MUST Know Before You Buy a Car.

7 Car Sales Secrets You MUST Know Before You Buy a Car.

Call (800) 641-7488 to speak with a live representative

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7 Car Sales Secrets You MUST Know Before You Buy a Car.

Before heading out to the dealership these days, it is necessary to are more prepared than ever.  Here are some secrets that every car shopper should know before walking onto a car lot, whether it’s a buy-here-pay-here used car lot on Western Avenue or that fancy downtown Chicago luxury car dealership.

As more and more Chicago residents are visiting new and used car dealerships, surveys show that the public hate dealing with auto dealership salespeople. According to Autotrader.com, less than half of 1% of people say that they prefer and enjoyed the traditional car buying process compared to alternative methods, such as online shopping.

Why are numbers so few?  This is because salespeople will do almost anything to sell cars in their inventory.  We’ve studied car salesmen and saleswomen and have a list of things to keep in mind on your next trip to a car dealership.

1.  No-haggle pricing is for Chicago suckers.

A very popular marketing tactic that has been making its way to car dealerships nation-wide including Chicago is “no-haggle prices.”  The ultimate reason car dealers love the no-haggle pricing structures is it eliminates the headache for the salesman including the sometimes lengthy negotiation process, a lose-lose situation for you, the shopper.  If you agree to a no-haggle sticker price, you’re opting in for an unknown profit margin for the car dealership.

2.  Car salesmen are not your friends.

Car salesmen choose to work for auto dealers to make commission on the cars they sell.  They do not go to work to make friends.

I repeat.  Car salesmen are not in the business to make friends.

Being friendly to prospective car buyers, or shoppers, is an old sales technique.  And if you believe the salesman has become your friend, you are more likely to believe that he/she has your best interests at heart.  They don’t.

3.  The Carfax Guarantee doesn’t guarantee everything.

Hopefully, part of the car-buying process includes a vehicle check-up.  The visual, the mechanics, and the papers.  A carfax is a used vehicles history report.  It starts from the beginning of the vehicle’s history and breaks down specific information from different databases.  It can include any of the following records:

  • Previous accidents or any damage to the vehicle.  This can include whether or not the airbags have been deployed.
  • Odometer history to ensure the vehicle’s accurate mileage.
  • Issues with titling, including salvage, flooding or fire.
  • Recalls or repurchases by car dealers because of major problems.  This can also be referred to as lemon status.
  • Records of prior owners and the number of times the vehicle has been sold and length of ownership.
  • Service and maintenance records that have been done.
  • Warranty status.

Carfax has a Buyback Guarantee where they will buy the vehicle from you if the Carfax report fails to include a DMV-issued branded title (such as salvage, fire or flood damage, and odometer problems), Carfax may buy the vehicle back for the full purchase price.  But be sure to read the terms, conditions and restrictions, found in the fine print of course.

4.  Car salesmen are not car experts.

I know that may seem shocking to some.  But most auto dealership salespeople aren’t car specialists.  But they do understand their dealership’s specific processes and procedures to efficiently sell, sell, sell!

Unfortunately, this may cause a loss to the customer.  Due diligence is necessary so you better google the specs and walk in with some knowledge.

5.  Dealerships are not non-profits.

Most car dealerships work with a network of dozens of auto finance companies.  Guess who your car loan will be written with?  Yup, that’s right.  The finance company that pays the dealership back with fees, incentives and bonuses.  Car dealerships are not required to offer you the best rates available.

Then there’s the buy rate and contract rate.  The buy rate is the interest rate that a lender may extend to a dealership when you apply for a loan, the contract rate is the rate is the interest rate the dealership passes along to you (usually with a couple extra points for themselves.)  Be sure to negotiate your interest rate, or better yet, apply for a car loan directly from your bank or credit union and cut the auto dealership out.

6.  Caution the extended warranty.

A common product most auto dealers offer that comes with HUGE profit margins is an extended warranty, aka extended service contract.  While most new cars come with a manufacturer’s warranty, that may not be the case with a used vehicle.    Remember that everything’s negotiable.  But buyer beware, read the contract – in full.  Check the labor rate the specific warranty company offers and the exclusions, or what’s not covered.  Usually, this will be enough to make you think twice.  If not, check out this article by Ronald Montoya at Edmunds.com, Five Questions To Ask Before You Say Yes to an Extended Warranty.

7.  Quote your car insurance yourself.

Auto dealership salesmen are not insurance agents.  In the state of Illinois, a car dealership cannot let you drive off the lot without valid liability insurance.  If the vehicle is under a finance contract, the bank will not process the loan without proof of physical damage coverage to protect their interest – the car.  While a car salesman may understand the basics and finance company requirements of a car insurance policy, they are not in the business to find you low rates on your car insurance.  When closing on a car sale, sometimes the process of getting the vehicle insured becomes a time killer and may postpone the sale.  In this case, auto salesmen have a local agent’s number on speed dial.  A quick phone call and even faster application process is a great convenience for the salesman, but not without a hefty price tag attached for this quick service.

Try your best to be prepared before walking onto a car dealership with an auto insurance quote on the car you have your mind set on.  In any case, an agent can provide you quotes on multiple vehicles you may be considering prior to making your final decision.  And when you do, a quick phone call to bind coverage while at the dealership can assure you the lowest rate and down payment.

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