Berkeley Parents Network: Buying a New Car

Berkeley Parents Network

Buying a New Car

Berkeley Parents Network > Reviews > What/Where to Buy > Buying a New Car

Advice about Buying a Car

Buying a New Car - What to Expect?
How to Get the Best Financing at a Car Dealership
Buying a Car Online
Auto Dealers by Make
See also: Buying a Used Car

Resources & Related Pages

Buying a New Car - What to Expect?

July 2007

I am helping my mother buy a Prius next month, and my memory of car-buying involves pushy sales people and never knowing if the price you're quoted is reasonable. Has anyone gone through the process lately? Can you get a deal on a Prius, or are they too hot to bargain for? Are there any dealers who take the Saturn approach (no haggling, more humane)? Thanks -
Bad at Barganing (and my mother is worse)

Car buying has gotten easier-- but, by no means, perfect-- since the internet came. Start by going to edmunds.com and researching the model and package you want. Edmunds will give you info on the MSRP, as well as the dealer's invoice... and, the 'going rate' for your zip code area. I think this came through some pop-up windows, or through carsdirect.com (where I made a separate inquiry), but your desired package then gets forwarded to all the local bay area car dealers, and they will either email or phone you with their inventory and price. The Prius has not been as hard to get, ever since the HOV stickers ran out, and dealers should be willing to offer discounts. Using the email replies, you can, to a certain extent, play them against each other. We bought our Prius toward the end of last year, while there were still HOV stickers, and we got a price smack between the MSRP and the invoice. Considering the hybrid frenzy at the time, I thought we did well-- we even came below the Edmunds' 'going rate' estimate for the bay area (which, by the way, was higher up here than for So. Calif.). We confirmed our price on the phone with a local dealer, went in for a test drive, and bought the car the next day. A competing dealer tried to, but couldn't, beat the price we had. The 'not perfect' part of the deal is that you still need to go to the dealer pickup and sit through the slimy finance and write-up guys, who try to sell you (guilt you) all kinds of un-necessary stuff. If you prepare yourself for that ahead of time, it's more of an annoyance than a real problem. jim

I bought a Prius last June and did not negotiate, just paid full sticker because I wanted a brand new one with all the gizmos, and I wanted to get it before they ran out of carpool stickers. Oh - I should say, I did negotiate on the 7 year bumper to bumper warranty that cost extra, and got a pretty good discount on that. I think the Prius frenzy has calmed down quite a bit, so you can probably do better than I did. Ask your friends - you may have someone in your circle who would go with you to handle the negotiation part (some people love that kind of thing, especially with someone else's money). And by the way, check out the tax credit - neither I nor my accountant qualified for it because of the AMT, which was a disappointment. anon

- We bought a Prius in August last year and because I'm a compulsive researcher did a lot of ''preshopping'' around and comparing dealers.

We found a few ''bargains'' in our search -- if you are flexible about color, interior, features, it's worth calling around dealers and seeing what they've got right now. People cancel orders, and less popular colors or perhaps 06 models might be available right away for a small discount. Definitely cast a wide net around the whole Bay Area. And check out what's on Craigslist in the dealer listings, although be prepared to act fast if you see what you want.

Many places did require a ~$500, refundable deposit for us to be placed on a Prius waiting list, and we ended up doing that and buying from with Putnam Toyota in Burlingame. We had a great experience with our seller/agent, Nazir Mojadeddi. Admittedly, we were an easy sell. We gave him our preferences for color, interior and features and then we all just sat back and waited -- about six weeks -- for us to move to the top of the list. But it was nice that he was mellow throughout and didn't try and push us to get a sunroof installed, custom leather, etc, like a couple of other places we approached.

BTW, sales tax is based on where you live, not the dealer's location, so buying in San Mateo Co., where sales tax is lower than Alameda Co. (if that's where you are) won't save you anything!

Service has been pretty good so far at Putnam too.

You could also look on priuschat.com and check out what others thought of particular dealers.

Hope this helps! Prius lover

My brother in-law bought a new Honda Civic last week. He delt with several dealerships trying to get the best price. He did all the negotiations via email with a salesperson. He thought that saved him a lot of time and prevented the games. Good luck

We bought our Prius from the Alameda Toyota dealership and it was a good experience. We paid less than blue book, although this was right before the craze began. They were not super hagglers either. We really didn't negotiate much at all. We were happy with the price and the car and just went with it. I think the craze has gone down somewhat, so you might be able to negotiate. Meredith

My wife and I used a non-profit service called CarBargains to buy our Toyota and it saved us three thousand dollars. It's a service offered by a non-profit consumer organization called Consumers' Checkbook (not to be confused with Consumer Reports which is a different organization).

800-475-7283 http://www.checkbook.org/auto/carbarg.cfm

What they do is approach three dozen dealerships and ask them to bid for your business. They call the fleet managers and make sure that if they bid they put their name on it. They also get all the fees up front so you know exactly what you're paying. Then you get a list of at least five bids. It takes seven to ten business days and you can have the report emailed, mailed, or FedExed to you. You can also call up the service and get help on the phone if you don't understand the report. It costs $190 but it's worth it. When we used the service, we got a list of twelve dealerships, and some actually lowered their price eight hundred dollars below invoice price just to get our business. Prior to getting the report, we had gone to some of the same dealerships and gotten the run around. We thought the Consumer Reports new car price report (not to be confused with the CarBargains service) would be enough, but the salespeople just laughed and gave us quotes that were three thousand dollars higher. Once we got the CarBargains report, they were more than happy to do business on our terms.

By the way, no haggle sales means you pay whatever the price is. In the case of buying a Saturn, you're basically agreeing to be ripped off by a friendly salesperson for thousands of dollars in exchange for a customer appreciation barbecue and a free loaner car when you come in for a service. Not worth it in my opinion.

By the way, if you're selling your mother's old car, make sure you know how much it's worth before trading it in. If you don't do this, you will be ripped off as my mother-in-law was when she traded in her car-by over a thousand dollars. You can get that information from http://www.nada.com and Kelly Blue Book http://www.kbb.com.

Also, make sure you have your financing before you go. We got ours from our bank and you can use it to your advantage to try to get the dealership to give you a lower rate. If you walk in without financing and ask them to do it, they will give you a high rate since the the higher the rate is the more profit they receive. And don't buy the extended warranty package they offer unless you shop around for quotes as they inflate that price on that as well.

It took us a month to get everything in order, but it was well worth it. Took a long time, but didn't get ripped off and got a fair price

We recently bought our first new car (a Camry) at Longo Toyota in El Monte. Even with having to drive it all the way back up north, the price was totally worth it. Since we bought the car, we sent someone else there for a Prius and that person couldn't find a more competitive price. There was no haggling, we were given a flat price and that was it. If you're interested, email me and I'll give you someone to contact. amanda

I went on kbb.com (kelley blue book) and found the price for the car that I was looking for. Then, I printed it out and took it with me to the dealersip. I got the car at that price with no hassles- much better than the sticker prices. anon

I bought a new Civic recently, and I wanted to avoid the whole dealership sales scene. I went to a local dealer to test drive the car model I wanted. I did not talk purchase or price. Neither did the salesperson. After that, I emailed 5-6 dealers within about 25 miles (they all have an Internet sales office). I did this by going to Honda's corp Internet site, and from there, you can email how ever many dealers you want with the same message. I told them exactly what model I wanted, and I asked them to respond back with their best price. Make sure they tell you what's in the price. Does it include shipping? Does it include all the taxes and license charge. You may want to go to the Consumer Reports site and pay $12 something for a report on the car you want. It will include the invoice cost as well as any rebates. While it is difficult to determine a car's true cost to the dealer, this will give a good ballpark figure to start from. I found most Internet salespeople to be fairly straight forward. Good luck. Anon

It will depend on the dealership. I bought our second Prius this past February for $200 below dealer invoice. Some unscrupulous dealers will try to charge you over the MSRP by telling you there is a shortage or they are hard to come by, or the options you want are the most popular options, etc. So I would recommend that you do some research and make some phone calls, and only show up to the dealership to pick up your car.

Go to the Toyota website and check out the package option you want and it will tell you what the MSRP is. The MSRP is the manufacturer suggested retail price. There should be no reason to pay more than MSRP.

Then call various dealerships and ask if they have the car in the package of your choice in stock, and what the price is. They will quote it to you over the phone and you can compare prices. You are likely to get the best quotes if you ask to speak to the fleet manager. The fleet managers get their commission by the number of cars they sell, not the price of the cars, so they are interested in selling more cars than in charging more. And because they deal with fleet, they will work with you over the phone with no nonsense, since they rather not waste time.

Another option is to call AutoByTel or Autoland. Look them up on the web for contact information. They are a car broker service. They will quote you a price and tell you which dealership has the vehicle you want. I have had good experience with both. For full disclosure, my brother works for Autoland and he was the one who found us our second Prius for $200 below dealer invoice and in the green with gray interior (most green ones come with beige interior). With these services, you don't have to call all the dealerships yourself, you let the broker do the calling and the research. You don't have to pay more, because these brokers have agreements with the dealerships and their cut comes from the dealerships.

Hope this was helpful. cecilita

The more informed you are, the better a bargainer you are, and there are now lots of useful helps on the Internet. For example, at Edmunds.com you can look up information on what invoice prices are (what the dealer pays the manufacturer for the car), and what incentives (like rebates) are currently being offered. (Prius has recently had rebates available.

Another thing that I would definitely recommend is using the Internet to get a price quote. You can do this through Edmunds.com, Autoweb.com, Autobytel.com, car.com, and probably other sites as well. When you do this, your name, contact info, and information about the vehicle you would like to purchase are sent to multiple dealerships. These dealerships usually have dedicated Internet sales personnel who handle these requests. They will get back to you (by email, if you prefer) with a price quote. You can compare quotes, and even see if one dealership will match the quote of another. In our experience, this is a much less high pressure, much more pleasant way to buy a car, and we have gotten excellent price offers.

Last of all, remember that you always have the power to walk out. The dealer can't sell you a car until you agree to buy it. Decide in advance how much you are willing to pay, and don't buy until you get that price.

Good luck. An Internet car buyer

Hi there...we just bought a Civic Hybrid and on the recommendation from a friend used an auto broker - Auto Advocates (autoadvocates.com). They are based in Marin Co. If you are a AAA member the cost to you is $99.00 (I think $250 otherwise). You research the car you want (in this case I presume a new Prius), let them know what you want and your top price. They locate the car w/in approx. a 50 mile radius and you go and test drive it. They will take care of negotiating w/the dealer and doing much of the up front paperwork. We bought from Marin Honda and if we had wanted the paperwork was all ready when we got there to sign(we thought about it and went back the next day). The only sticky point we met was w/the finance guy at the dealership who tried to sell us their additional warranty (on top of what Honda already offers), but we refused. This apparently is where they make lots of $$, but it isn't always worth it. Anyhoo, all in all, with an 8 mo. old, it saved us a lot of haggling...and we love our new car! Good luck and hope it all works out....Paula Paula

How to Get the Best Financing at a Car Dealership

June 2007

We are buying a car and we would like advice on how to get the best interest rate on a loan from the car dealership. We already were approved for a loan from an online lender but we would like a lower rate.

We have heard of people asking the car dealership to beat the rate they have. The only problem is that the dealership only offers a slightly lower interest rate.

We were wondering if it would be better not to say anything until after the dealership makes us an offer. Then we could mention the interest rate we have.

We plan to negotiate the price of the car before we mention financing. We just don't know the best way to go about doing this.

Any advice or personal experiences would be greatly appreciated. Anon

Unless you have a credit rating of 750 or above, you will not get the best interest rate. If you do have 750+, there may be a promotional rate that will be really low.

The best way to get the best deal/loan interest rate is take a loan from a credit union and bring your letter of credit to the dealership.

Other than that, you are at the mercy of the F&I person at the dealership, and (I'm giving proprietary info here, so heed it well), they get kickbacks for getting higher-interest loans approved.

I'm in the industry, so I know this to be true. -- Want you to get a good deal

Your instincts seem good to me! Wait until the dealership makes you an offer before you ask them to beat it.

Among the most useful things my father ever taught me was negotiating with the car salesman at a dealership. He is an utter genius at it, and if I've picked up any of his tips, I'm better off for it. Thanks, Dad!

His strategy was to let out one piece of information at a time. So you'd select the car, go into the office, and sit down to discuss the first offer.

1) Once you have the first offer, tell the salesman that another dealership will give you the same car for $xxxx less. (Note this will only work if you have called another dealership in advance to get their price. Just in case the salesperson you're dealing with face-to-face calls your bluff, you should be able to prove you can get the car cheaper elsewhere. If they ask why you're not at the other dealership, claim convenience.) When the dealership makes a counteroffer, call the other place and ask them if they can beat it. Lather, rinse, repeat.

2) Once you have a price you're satisfied with, you can discuss payment. If you are trading in a car, now is the time to bring it up, NOT before you have an agreed upon price.

3) Bring up financing and let them make an offer. Tell them what you're getting from another bank and let them make a counteroffer. Lather, rinse, repeat again.

It's just like job negotiations in that you want to let them state a price first. Better leverage for you. Good luck! -- a happy car owner

Buying a Car Online

victoria 10/99
There are lots of web sites where you can find MSRPs and invoice of new vehicles. For instance, www.autosite.com, or carpoint.msn.com if you like Microsoft.

However, I'd like to recommend two surprisingly good web sites for car buyers. One is www.edmunds.com

In addition to price info, technical info, and reviews, this site hosts a number of very active forums of consumers (and occasional dealers) exchanging information about vehicles. As you can imagine, one topic that is heavily discussed is what kind of price people have been paying for various models, including the Honda Odyssey. (It turns out that I am also interested in the Odyssey, and the best you can do with it is roughly MSRP).

The other site, www.carorder.com

lets you buy new vehicles at heavy discount without negotiation. Most other car buying services (including CarPoint) only put you in touch with a dealer and are utterly useless, since you still have to talk to the dealer. I have checked a couple of carorder prices and they seem to be pretty much the bottom.

For instance: the CarPoint dealer quoted 2% over invoice for a Mazda MPV 2000 after three calls and a good workout to my spleen. Carorder.com gave me 0% over invoice in 2 minutes. The MPV discussion group also reports 0% over invoice in the best case.

The only limitation is that Carorder doesn't seem to deal with hard-to-get vehicles, including the Odyssey.

Good luck (and take a good look at the Mazda MPV 2000 before you buy the Odyssey). ---Luigi

January 2000

We have recently found that you can actually order a car from the internet, and the web site is carorder.com. (there may be others) It seems like the ultimate way to buy a car: no pressure, no negotiation games and you get exactly the color/options you want with a price typically lower or equal to the invoice price. However it sounds a bit too good to be true. So I would like to hear from you if you have any experience with such companies. How was it, is there any hidden catch, etc. thank you!
Peilin

Recently my father had to buy a new car. He and my husband went to all the dealers in the area to try out different brands and models and get information on pricing. Then they came home and started looking up online car dealers. They were very impressed. The online dealers told you what the invoice was and the markup, and you could pick all kind of options. They even had better financing through the website than that offered by the credit union, but the catch was it would take 4-6 weeks for delivery (I don't remember which of the online dealers they were using) and my dad needed the new car right away. So they took the price quote from the web to one of the dealers, as a bargaining tool. It turned out that the dealer was quite willing to match the price quoted (a small percentage above invoice) and my dad was able to drive his car home that day.

First of all, I do not have any personal experience with this type of service. But, my sister and her husband purchased a car off the web. They used another site, though (I think it was autobuy.com). They had a great experience. They ordered a 2000 VW Jetta and got everything they wanted. The car was delivered on a flatbed truck within a couple of weeks. In terms of the cost, they saved only the sales commission--which could amount to a couple thousand dollars. don't get me wrong--2k is quite a bit of money to save. It's just that some people expect to save a considerable amount of money. Unfortunately, you still pay state tax (which is considerable) Most of the sites will also allow you to apply for financing online. But, I have no experience with this aspect of the business (my sister and her husband paid cash). Personally, when it's time for my husband and me to buy a new car, we intend to use the internet. As far as I'm concerned, the lack of sales pressure is a MAJOR plus. Good luck.
Jeanette (1/00)

Apparently there is no catch. Check the discussion groups at www.edmunds.com by far the best source of automotive information. Other well known companies are carsdirect.com and www.autobytel.com. A lot of people consult these sites to see what price they can get, and then they use the information to negotiate directly with a dealer. That seems to work well too. The only problem is that they don't deal in cars that are hard to get---for instance, I couldn't use them to buy my Honda Odyssey.
Luigi (1/00)

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