Holiday Car Sales

[MicroMiniMe]

So anyone ever buy a car on these holiday weekend 'SALE Blowouts!"? You see them every big patriotic holiday mostly over the spring/summer. Are the prices really lower, or is it just hype and free hot dogs?

/Paging Lohman

So when is really the best time to buy, and is there a trick to get the lowered interest rates?
Is late fall the best time to buy new for the same model year when the next model year starts showing up on lots.

[maxama10]

well in relation to my wrangler thread, we bought a Wrangler Unlimited...they sold it to us for the dealers price or something? so it was supposed to be a 'bargain'

[Lohman446]

The short answer is no, never let a salesperson pressure you with "you can't get this price tomorrow" - Ill get into the explanation and tips tonight (I hate this keyboard where i am)

[surfbum]

my parents just bought a car yesterday
for less that what the dealer paid for it

[PyRo]

Dealers lie...
They tell you they're only making x amount on it or they're looseing money on it because management told them they need to make room.
When my father bought his new Silverado he had a friend find out what the dealer actually paid for it, He went in there and told them how much they paid for it after all they're fees, taxes etc and told them to order him one for $500 over that price. With a little convincing the manager went with it. I suppose they figured he was going to get it or walk out and why not take the easy sale since he knew exactly what he wanted and had the money. That saved him about $3500.
Then with his new Toyota the salesman gave him a price which he swore he was only makeing $500 on. He ended up taking it home for $1500 less then that. I'm sure the dealer still made over a $1000 markup on it after their fees though.

[Steelrat]

my parents just bought a car yesterday
for less that what the dealer paid for it

A lot of people think that, but it's seldom true. Dealerships have a lot of way to make money from the manufacturers. It's not just about the "invoice" price.

[Lohman446]

Ok... here goes, car buying 101

New cars. The dealer is not loosing money on this years model, nor on last years model. Find a new car that has been on the lot through three model years and you might get it below dealer price, though even that I highly doubt.

"But I'm selling it for $100 less than I paid for it" - For new car dealers... yeh, and then all rebates and incentives to dealer, and btw, there making money on the financing end. As to used car dealers. It does happen from time to time, but its not common. Unless they pull out a legitimate "black book" (in MI its a used car sales record book) and show you the price, its not likely. Be aware that I have heard of dealers keeping a set of books just for customers that are not legit.

Now, as a general rule I don't buy new cars, nor do I ever see myself doing so. If you insist on buying a new car secure financing outside of the dealership. With decent credit a bank will give you a short term personal loan and then finance it as a car after you have written the check. This gives you the power to deal as a "cash" customer. Skip the salesman, and the sales manager. Find out who the fleet or finance manager is. Deal with this person and buy the vehicle, no trade in, just a quick transaction. Buy something in stock. Various resources online will tell you approx value of what you are buying. This is the only way to buy new unless you know someone very trustworthy in the business.

Trade-ins. Generally, don't, at least not for money. Trade ins are a great thing if its your intent to avoid the work of selling a used vehicle. But there giving me XX more than its worth. There also getting XX+Y more than the vehicle they are selling you is worth. Sales tax is collected on the full price, including trade in, getting a high trade in value for your vehicle only costs you more taxes. The dealer is not loosing money on taking your trade, not if one considered the entire transaction.

"But the book says...." Go to NADA.COM. Then go to KellyBlueBook.com (or such). The figures are so far apart as to be ludicrous. Be aware of current market values through research

"By today for todays super special blow out sale" If they can afford to sell it today for that price, they can afford to sell it tomorrow for the same. Do not fall for high pressure tactics.

"My friend can go to a wholesale auction and buy me..." Don't - unless you or your friend are very mechanically inclined. I routinely figure 10-20% of the wholesale price will be needed in repairs to a vehicle, certain vehicles I figure a whole lot more. I routinely arbitrate and end up turning down the sale after auction of about 50% of the cars I buy at auction for undisclosed mechanical issues (and most auctions you get a short test drive, in there lot, on there terms, once you take it outside there gate, its yours). Auctions have various and different rules about arbitration processes and it can be a tricky situation. Yes, this is where most used cars on lots come from, however, dealers are protected by the scale of quantities.

"Buying from a private individual gets a better price" I have found that generally not true. A private individual normally overvalues there own vehicle. They are also more likely to be trying to cover up a problem than a dealership as they are not needing you to ever be a repeat customer, your word of mouth cannot hurt them, etc.

So, how do I get a good deal on a used car? I buy all my cars wholesale, so be aware that my advice is from my side of the fence.

A) Secure your own financing seperate from the dealership. Be aware that many dealerships make money off of financing. This allows you to deal as a cash customer.

B) Buy from car lots where the car lot is a secondary business. Many places run car lots on the side. A car lot that has to be stocked has to buy cars regardless of the going wholesale rates - which fluctuate substantially. A dealership that does not, well... does not. This allows them to be pickier about cars and prices.

C) Have a vehicle inspected by a competent mechanic. Ask to see it on the hoist. This does not mean your friend Jake, who once fixed a lawnmower, going for a ride with you. PAY someone to do this. Most mechanics work on an hourly basis, and paying tends to increase the chances of you getting an impartial opinion.

D) Do not stand there and point out every little scrape, ding, possible issue on a vehicle to a sales person, they tend to know they are there and you doing this just annoys them. As with many things in life your attitude reflects your price.

E) When paying in cash, with no trade in, throw the NADA book the dealer will show you out the window, its of little meaning. Often realistic value is found closer to trade value than retail.

F) Never look at a vehicle and buy it on the same day.

G) If you here the word "birthday" from a used car dealer it means they have had a used vehicle on there lot for over a year - expect a great price.

H) Let the dealer offer prices. Once you have "settled" on the best price (out the door) you are going to get go home and think about it. Wait a day, maybe two. Call them back and tell them you can come close to that price but are $100 or so short - you will normally find the price $100 better.

I) State documentation fees: There are state documentation fees, yes. These are the title fees collected for a vehicle, and of course tax. Watch out for dealers that sneak in an extra $100 or $200 into fees they assess. Make sure you know what you are discussing when you are discussing prices. Does it include tax? Title? Liscence fees? Ad veloreum (sp) fees?

Best I can give you. Understand I buy from sources I would generally advise others not to. Wholesale auctions, etc. Understand I also take the risk when doing so, am used to doing it, and reasonable competent mechanically.

[maxama10]

how many cars have you bought!?

[SpitFire1299]

It means nothing.. its just an idea to trick kids my age and old people.

[Lohman446]

how many cars have you bought!?

Several hundred

I run a small used car lot (+ auto repair, + U-haul, + parts store), I have worked at a dealership in the past. One of my responsibilities involves buying vehicles.

[Lohman446]

I'm going to add a few more points.

Aftermarket warranties (non OEM). These are generally a bad buy. Some require documentation of ludicrous maintenance. Most require vast amounts of diagnostics and then "patch" repair things. For instance, come in with an engine knock I cannot tell you just the engine is bad and replace it - you will have to pay for full tear down to ascertain what rod is knocking out of your pocket, then they might replace the engine. Generally they pay far less than the going rate and use a flat rate time most shops will not honor. They also do not pay common fees such as haz. mat. disposal and shop supplies Most shops have learned to not go with what they say, simply bill normally and let the customer pick up the balance - often nearly half of the total bill. There advantage - at least at base. Should you not have an honest mechanic there adjuster may "scare" them into being more honest. Get a new mechanic, its cheaper.

Check fluids. I arbitrate over irregular fluids about 20% of the vehicles I arbitrate. Pull the dipstick, it is known that if you run a higher weight oil (or Lucas) you can hide engine noises. Heavier transmission fluid (or Lucas) can be a band-aid to a shifting issue. Know what the different fluids you will encounter should look like, and be wary if they do not look right (and clean). For the record, I find this tactic more common by private sellers than dealers.

[MicroMiniMe]

Have any issues getting salvage titles that haven't shown up yet as such at your auctions as restored salvage vehicles? Or dealer side is there some law protection for you on that?
My state has a few loopholes for salvage title (or it did 10 years ago) and I think they can be insured just fine, its the banks that won't do financing (as they shouldn't).

[PyRo]

Have any issues getting salvage titles that haven't shown up yet as such at your auctions as restored salvage vehicles? Or dealer side is there some law protection for you on that?
My state has a few loopholes for salvage title (or it did 10 years ago) and I think they can be insured just fine, its the banks that won't do financing (as they shouldn't).

Why do people think that if a car has been in an accident it's worthless. An accident means nothing so long as the repair work was properly done.

[MicroMiniMe]

Why do people think that if a car has been in an accident it's worthless. An accident means nothing so long as the repair work was properly done.

Well worthless and below wholesale are different things. The beancounters don't want to get stuck with something they can't get their value on properly.

But yes, a properly restored salvage title is a great car to get if you plan on keeping it forever or to run into the ground. But banks don't like them, and people don't like to find out they got sold one if they didn't know it was one.

My old man would get two or three salvage cars each winter when he was working construction (laid off 3 months) and get the minor damage ones to fix, paint and sell after driving them a little bit. Most buyers thought a 4-5 year old model car for real cheap was a good deal. Mostly asian imports, easy to fix and many interested buyers. If they asked him if it was salvage, he would tell them so, otherwise you couldn't tell the difference. Matching the paint wasn't that hard, and junkyards had plenty of factory made parts in perfect condition. He once sawzalled a Honda in two down the middle and welded back a junkyard back end that had no damage. Kept the collision back end for parts down the road. Outside of engine or frame damage, its pretty easy work for a decent mechanic. He hated painting them though. He laughs now that I have to wear the same respirators for work.

[Lohman446]

But yes, a properly restored salvage title is a great car to get if you plan on keeping it forever or to run into the ground. But banks don't like them, and people don't like to find out they got sold one if they didn't know it was one.
.

Both you and Pyro hit on the points. Properly restored. Salvage means the insurance company totalled the vehicle - there was enough damage that they judged, fixing it right, was not worth it. Although sometimes these are far off, most of the time they are pretty correct.

Currently, I would be very worried about salvage (flood) vehicles. Salvage because of damage you can see is one thing, salvage because of the long term effects on the electrical system of swimming is another totally different ball game.

As to auction - all titles are assumed clear and if not must be stated as such. This is something you should verify when buying a vehicle, that the title is clear (or the vehicle is being sold at a value that reflects a not clear title). Again, unless you are mechanically very able to know, or trust someone explicitly who has done the work, I would stay away from them. If you have the mechanical knowledge to tell a good repair from a bad repair its different.