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How to Save Money When Buying a New Car

10 Magic Words to Say to Get the Best New Car Price

Our friends at Wise Bread share with us their tips and tricks for getting the best price when purchasing a new car. Want to figure out how to get the best deal? See all the details below.

Most of us still go to a car dealership when we want a new vehicle. And most of us dread the experience.

The problem is, you and the dealership are two parties on opposite ends of the spectrum. You want a great car for as little money as possible. They want to sell you the same car for as much as they can, and include a ton of extras. The battle for a compromise can take hours.

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However, you can make that battle much easier by learning, and using, the following ten phrases. They will save you time, money, and a lot of hassle.

1. "I'm Already Pre-Approved For a Car Loan."

Before you go to any dealership, arrange your own financing with a bank or credit union of your choosing. Make sure you do your homework, find the best rate, and get written approval of how much you can borrow (along with the terms of the deal). When the dealer knows you are pre-approved, they won't try to hit you with a high-interest loan. Now, on occasion you may find 0 percent financing offers at the dealership. If it's a genuine offer, and doesn't take other discounts off the table, you can always choose it. But with pre-approval, you are keeping all your options open.

2. "I'm Not Interested in Monthly Payments."

Even if you are, that is not the place to start. Car dealers can work all sorts of magic with the numbers to get you to the monthly payment you have in mind. But, it's a trap. It's not always an intentional one, but it's a trap nonetheless. Monthly payments on a $20,000 car can be $265 a month, or $865, depending on the interest rate and length of the payoff. You do not want to discuss monthly payments until you have agreed on a total purchase price for the car, including the extras the dealer may want to throw in. Once you've shaken hands on that, you can work on how to split the payments up.

3. "Let's Talk About My Trade-In Later."

When you arrive at the dealership in your current vehicle, the salesman will immediately start asking you about it. They'll look around it, nodding, giving approving glances, even if it's a wreck. Before they go any further, tell them you don't want to talk about the trade-in yet. Don't say you are not going to trade it in at all, unless that's actually your intention. But the trade-in values can mess with your head, and alter the negotiation on the car price. Often, the salesman will start bumping up the value of your trade-in to get your monthly payment a little lower. The truth is, they were undervaluing your trade-in from the get-go. So, keep that one in your back pocket until you have agreed on the purchase price.

4. "I'll Come Back Another Day."

This is Kryptonite to the dealership, and the salesman you are talking to. The second you pull out this phrase, be it after the test drive, or during the intense negotiations, the salesman will be immediately put on the defensive. When someone walks on the car lot, they are a potential sale. Potential sales mean commissions, and hitting sales figures. The second you walk away, you're gone. You may never come back. And their commission goes with you. Using this phrase is a great way to take back control of the negotiation. However, you have to be prepared to follow through. I have walked away from the dealership after two or three hours of time and energy. They just couldn't hit my numbers. Unsurprisingly, they called me the next day and asked me to come back; they had found a way to hit my asking price. Well . . . there's a shock.

5. "I Don't Want the Extended Warranty — or Rustproofing."

Once you have bought the car, the salesman will hand you off to the financing department. This is when they double-down with the pressure. They'll offer you an incredible bumper-to-bumper extended warranty, they'll show you all sorts of undercoats, tinting, clear bras, and other additions. Just say no. Whatever the dealership is offering, you can find it way cheaper from a third party. Once, the salesman whispered in my ear "Don't buy the tinting, I'll get it down for you for half the price." And he did. Sure, he got a finder's fee, but he saved me a few hundred bucks.

6. "Please" and "Thank You."

At the end of the day, this is a negotiation. Car salesmen are doing what they are paid to do, and you're doing your job as a savvy consumer. But there is never any call for rudeness, and being polite will go a long way to getting you to a place you want to be. Rudeness and demanding language will show you to be a bully, a difficult customer, and someone the dealership would probably rather not have around for the next few hours. Yes, your business is important. Very important. However, everyone has a breaking point, and exceptionally rude people just aren't worth it.

7. "I Already Know What the Car Is Worth."

Before you set foot on the lot, do your homework. You need to know the TMV, or true market value, of the car you're buying. You should also know the Blue Book value of the one you're selling. Don't memorize these numbers; bring printouts with you. You want hard evidence, because it's way easier to bargain with it than a number you appear to have pulled out of thin air. When you know the TMV, go lower. Not by much, but by enough to let them know you want a deal. At the very least, you should walk away having paid what is fair.

8. "I'm Just Browsing."

You can use whatever variation you like on that theme, including "Oh, just looking around," or "My daughter's going to need a car next year." Whatever you do, keep the energy down, and don't ever let on that you're there to buy a car. If a salesman strolls up to you and asks you why you're there, never say "I want to buy a new car today!" You'll be putty in the dealership's hands.

9. "Can I See the Invoice Price?"

The sticker you see on the window of the car, whether it's old or new, is not what the dealership paid. So, you do not want to use that as a starting point for your negotiations. You want to see the actual invoice, and not surprisingly, most dealerships are reluctant to show that to you. But, dig your heels in and politely ask for the invoice. Once you have it, you're in a better place to negotiate.

10. "Tell Me What Incentives Are Available."

Every car dealership has a list of incentives that they're working with. If you look at the fine print on some of the deals you'll find in the local papers, especially for low APR financing, you'll see that you "give up" the customer incentives to get the deal. Well, if you have your own financing already, you want those incentives. So, make sure you ask for a list of incentives, and how to qualify for them. They can include military discounts, cash-back offers, and free upgrades.

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