Thursday, January 19, 2012

New car purchase/trade in value dealer negotiation?

First off, I know new car dealers try to stick it to you when you buy a new/trade in a pre-owned vehicle. However, is there any advantage to this scenario?:



I have a car loan where I still owe $9000. My car KBB is $9000 and CarMax will give me this much if I sell it to them. If I take my car to a dealer and offer it as a trade in, showing them the $9000 offer from CarMax, they will usually accept it. However, if I try to negotiate with the dealer to get $10,000 ($1000 more than I owe on the loan) and tell the new car dealer that I will use this $1000 as "down payment" on a new car, is this a useful strategy to negotiate? I mean does the $1000 above cost to pay off the loan provide the dealer with any incentive to offer me more than what I owe if I will then turn around and "give" that $1000 to the dealer toward a new car purchase?New car purchase/trade in value dealer negotiation?
Actually, if your dealer gives you the same amount as CarMax will buy the car for, you already have a better deal. You pay sales tax on the trade difference.



Here is how it works. If you buy a car for 20,000, and sales tax is 7%, your sales tax is $1,400. If you get 9000 for your trade in, you pay sales tax on $11,000, or $770. So, by trading your car in, YOU are already saving $630.



And your example is also not making a lot of sense. Why would the dealer give you an extra $1000 for your car if you were not buying a car from him? It is his own $1000 dollars he is giving you. Who cares if you give it back to him to purchase a car? He is still losing $1000 unless you let him charge you an extra 1000 for the car you are buying.



There is absolutely NO incentive to give you 1000 more for your car other than if he wants to make a car deal. It means nothing to the dealer if you apply it to your new car or not.



PS - it is also known that when you buy a new car and trade in a used car, you try to stick it to the dealer.. of course when YOU do it you are simply a smart consumer electing to negotiate the best deal possible... when the dealer does it he is a money grubbing scumbag, and not a responsible business owner trying to make a profit and provide for the dozens of employees he is responsible for or his own family, right?New car purchase/trade in value dealer negotiation?
I sold cars for 2 years if they give you 10 for the trade it is because they have enough room in the car you are looking at to give it to you what they actually give you for the car is less, they are just moving figures around, also check to make sure they do not have incentives they are keeping like 1000 off or 2000 off, stay away from 3000.00 guarantee trade push pull or drag they are making money no doubt about it they are just good at moving numbers so you think you are getting a good deal, sell it your self for 10 then go with 1000 down and negotiate the price off the sticker price.

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