I’ve figured out a pretty solid way to save around five grand on a used car.
I thought about trademarking my method and producing a late-night infomercial to sell it to the masses for only $19.95, but it’s so simple I might as well divulge everything here.
Regular readers may recall the innocent question a week ago that sparked a used car search. I didn’t think I needed a different car at the time, but once that door of possibility opens, it’s hard to close it.
My current car has over 125,000 miles on it and a host of small problems popping up. The cruise control works sporadically, the driver’s side seat heater doesn’t work and, most of all, the car doesn’t hold the 6 people in my family.
Enter the 2008 Audi Q7. Yeah, it has 82,000 miles on it, but it’s in tip-top shape and easily seats all 6 of us. The biggest problem is the $23,000 price on the window.
There are two ways to buy a used car: the right way and the wrong way. In the wrong way, a used buyer will shop on monthly payment amounts or fail to negotiate all sides of the deal. For the Q7, the dealer initially presented a price $500 below sticker and a monthly payment of $518.
In the right way to buy a car, a buyer will negotiate the price of the car, then the price of a trade-in, if there is one. He or she will also be prepared with financing pre-arranged by a bank or credit union. In my case, the bank’s interest rate is a full percentage and a half lower than the dealer’s offer. Combined with a slightly longer term, the payment on a $20,000 loan is under $300 per month.
Armed with an approval from the bank, a reasonable offer and a decent trade, the deal is inevitable. Offer low and negotiate up to your set limit. The real secret to saving the most amount of money is to go through this process in the last week of December. Dealers are hungry, and traffic through the dealership is slow.
The best piece of advice, though, is this: Make your final offer on the morning of Christmas Eve or New Year’s Eve. Maybe it’s the Christmas spirit at work, but low offers tend to get accepted!
What’s the best deal you’ve ever negotiated on a used car?