For those who have had some experience buying cars, you can still be tricked by the car dealership if you are not aware of this. There are a lot of car dealerships out there that increase the price of a car by at least 10% to make some money. This may sound weird, but it is true, and I have seen this more than once. There are big and busier dealerships, and there are also smaller dealerships with fewer customers. To make sure they make enough money, many smaller dealerships often increase their prices.
About three years ago, I helped my cousin to buy a car. Since her family lives in a small town, and my cousin only wanted a compact sedan, they thought they should just stop by at the local dealership to look for a car. Since I have had some previous experience with buying cars plus I know a guy who works as a manager at a car dealership, I made sure we came prepared. The first thing I did was to look for car models from different brands to see which one my cousin would want. After she found the make, model, and the color she loves, I contacted different dealerships to ask for quotes. Since my cousin’s family decided to buy the car at the nearest dealership, I contacted them, asked for a quote, and got what seemed to be a very fair price.
When we were at the dealership, the salesperson was very friendly and helpful. He was new at the dealership but showed to be very professional. After a few rounds of test drive, we went to talk to the finance department. While we were discussing the price, payments, and interest rates, I noticed the finance guy kept rerouting our attention to the monthly payments. Just as I discussed in my last blog post, car dealers often try to trick customers into buying a more expensive car with a longer loan term. During our conversation, I wanted to know what would the final price, or what I usually call, “the outdoor price” be. More than once, as long as I mentioned this, the finance guy told me that what they wanted us to focus on was the monthly payment. Keep in mind that whenever a salesperson tells you to focus on something, that person is hiding something else. After a quick calculation, I figured out something was off. The sum of the outdoor price and all of the interest that I calculated was $2000 less than the sum the dealership gave us. I tried to ask the finance guy to explain that $2000, he kept ignoring it until he finally asked me this ridiculous question: “Who is the car for, and who is paying?” My aunt was too honest and slipped out that she was buying the car for my cousin. The finance guy ignored me completely and talked to my cousin only. As a result, I told my cousin and my aunt to stop everything and drove them home. No one should ever waste time dealing with people like that finance guy.
Shortly after that, I was able to find another car with a better deal for my cousin. I took them to a bigger dealership that does not lie to customers. The next time you shop for a car, ask the dealership’s finance department to break down all of the numbers in your loan. If they hesitate, think about stopping by a few more dealerships to compare the prices.