looking at cars - make an offer?

[B Buddy]

I am going to look at a 2 or 3 cars this week.

2 are Mustang GT convertables, and one is a Nissan 350Z convertable.

They are all at car dealerships, and all have low miles on them and are 2006 models.

a. One of the Mustangs is from carmax, and it's selling under it's blue book value by about 4k, and it's their bottom line and final price.

b. There's another Mustang GT I like that has a few more features but they are asking about 5k more. I thought I'd offer them 30 for it. It's blue book is about 32k, which is what they are asking. I'll be carrying cash should paying cash help me get a better deal? I like this car the best, but it's close to the same model as the one at carmax with a few extras, and they are asking 5k more. I still haven't test driven any of these so i might decide to go with a nissan 350z but i'm leaning towards getting a mustang.

http://www.cars.com/go/search/detail.jsp...amp;aff=tenness

3. Nissan 350z - selling at about blue book. They are asking 30,900. I'd probably offer around 29-30k.

http://www.cars.com/go/search/detail.jsp...leadExists=true

Any negotiating tips, or suggestions on getting a good deal on a car w / less than 20k miles but not new (i'll be paying cash)?

Thanks

[xxThe_Lebowskixx]

i think paying cash for a car gives you more leverage than paying cash for a house because the car depreciates before repossession.

[FastPlaySlow]

Used BMW M3 plz

[Big TR]

I'd say you are offering way too much. Ignore Blue Book and look at the wholesale value they probably paid for the car, work your way up from there. You're probably leaving a few thousand on the table with the potential offers you are throwing around in your post.

Financing with the dealership will probably get you a better deal as they make money on getting you financed. You just turn around and pay off the loan immediately.

[captZEEbo]

[ QUOTE ]
I'd say you are offering way too much. Ignore Blue Book and look at the wholesale value they probably paid for the car, work your way up from there. You're probably leaving a few thousand on the table with the potential offers you are throwing around in your post.

Financing with the dealership will probably get you a better deal as they make money on getting you financed. You just turn around and pay off the loan immediately.

[/ QUOTE ]early prepayment penalty probably exists

[pig4bill]

Exactly. Paying cash won't impress anyone, and as Big TR mentioned, the dealership usually gets a kickback from the finance company, unless it's a credit union or someone like that.

Also in agreement that those amounts sound like way too much for used cars. Isn't that about what they sell for new? For 30 grand you can probably ind a nice C5 Corvette.

Nobody can sell new cars right now, so you should be able to strike a great deal on a new one, especially if they have 2007 models left. For example, there's a $1500 rebate on new 2007 or 2008 Mustang GT's. Or you can get a new Subaru WRX or Mitsubishi Evo, among others, for less than 30 grand. Remember that your new car warranty begins when you take ownership, vs little or no warranty on a used one.

BTW, when throwing your bundles of cash in a gym bag to take to the dealership gansta style, don't forget to add 10% for taxes and tags.

edit: Look on edmunds.com for a list of rebates and incentives.

[spex x]

[ QUOTE ]


Financing with the dealership will probably get you a better deal as they make money on getting you financed. You just turn around and pay off the loan immediately.

[/ QUOTE ]

I know a guy that has a couple used car dealerships. I also sell real estate and carry notes on those sales. The answer to the OPs question is very much 'it depends'. The biggest thing that it depends on is whether the dealership carrys the financing itself or whether they have a realationship with third party finance companies that do their financing for them.

If they carry the note themselves, paying cash will be a STRONG negotiating point. Very strong. Thats because in just about any business having the money in hand is much better than having it owed to you.

But if they have a 3rd party company, it may be better to get the financing due to what the others mentioned about kickbacks and such.

What I'd do is print out all the cars you're going to see and take all the printouts with you. Then go to the most expensive one, show him printouts and ask him to beat the lowest price. When he does, take his price to the place that he beat and tell them what happened. If they beat his price, great. Repeat until someone won't go any lower.

When they ask about financing, tell them that you haven't decided yet. Negotiate your price first. Once you've found the bottom line price, THEN bring up financing. Just ask them how much more they can give you off the price if you pay cash. If they say nothing, ask them how much more if they finance. If they say nothing, then leave. The sales person will freak out when you do, and he'll probably call you several times over the next two days. Once he's just about given up, then you show back up and start over from where you left off. If, at that point, he doesn't go any lower, you've probably found the real bottom line price.

Here are some tips:

Don't give the sales person anything. Nothing. Be nice, but not friendly. Don't chat, and DEFINITELY don't talk about how much you like the car. Be very noncommittal. These guys try to play on an emotional attachment to the car, so don't give them any ammo. You are making a business decision, so treat it as such. When test-driving, ask the salesperson to be quiet so you can listen to the car, otherwise, they'll talk you to death the entire time.

The sales person will repeatedly have to go to the manager to 'ask permission' for everything. This is part of the game, and is par for the course. Personally, I find it to be very annoying as I'm not much of a game player. What you might try is rather than talking to a regular sales person, ask for the manager. If he trys to refer you to a sales person, open your gym bag full of cash and show it to the manager. Tell him that you're likely going to buy a car that day and that you require someone that can make decisions. Explain to him that you'll only work with their business if you can either deal directly with the manager or if the manager gives his sales person full negotiating power in the transaction. This type of thing has worked good for me in the past.

A wise and experienced real estate investor once told me that when negotiating, the first person to mention a number loses. I've found that to be true. Let the sales person talk numbers. Your montra is 'no,no,no,no,no'.

hmmm...sorry this ended up being so long. I'm one of those guys that LIKES to negotiate.

[pig4bill]

It's usually Sid and Ernie's Used Cars on the corner that carries their own paper, not CarMax. Those used car lots won't have 2 year old $30k cars, more like 10 year old $10k cars.

BTW OP, UAW is on strike, so those new car rebates may not be around forever.