Trading in/negotiating for a new car

jason_t · #1 09-12-2005, 10:10 PM

I'm buying a new 2006 Honda Civic possibly as early as tomorrow morning. I'll be trading in a 2004 Honda Civic that is in excellent condition and paying the difference in cash. I know absolutely nothing about how to negotiate to maximize the value on my trade-in and minimize the price of the new car.

I haven't even learned the art of negotiation through experience. When I bought my current car I walked into the dealership, pointed at a car, said I wanted it, looked at the sticker price of $16360, offered $14500, he countered with $14800 and I accepted. I know that car negotiations are not supposed to be this easy and I don't know why it was for me; the only thing I can think is that I bought it on the evening of April 15, 2004 and maybe the dealerships don't get much traffic that day.

I don't expect to get much below MSRP here being that the car was just released last Friday. But I have been told that dealers have something called a "holdback" and that can be used to get a lower price on the car. What is that, how do I find how much it is and how do you bring that up with the dealer?

I'm looking for any other tips/suggestions/etc. that you might have.

Thanks.

Al P · #2 09-12-2005, 10:14 PM

http://www.carbuyingtips.com/

If you are going to be paying cash for the car and do not need financing, find out about what rebates are available if you finance through the dealer. As long as there are no early repayment penalties on the loan, finance the car to get the rebate and then pay the car a few days later.

That will also improve your credit score.

STLantny · #3 09-12-2005, 10:14 PM

1. Dont trade the car in, sell it privately, the time you take to sell it will be worth the cash.

Other than that, know what you should be paying for the car, and really low ball it. When I went to buy a car, teh salesman asked what I did for a living, and I told him I play poker, he was really interested, and I actually helped him get signed up and deposited online, he gave me a HUGE deal, but I backed out at the last minute, becasue I want to find something else, I think.

newhizzle · #4 09-12-2005, 10:16 PM

wait till the end of the month, they have to hit quotas and are willing to go lower in the last couple of days of a month

lu_hawk · #5 09-12-2005, 10:17 PM

trading in is almost always going to be worse than selling if you are looking to maximize your value. also, when you trade in they will most likely give you what seems like a good deal on the new car, but then they will lowball you an equal amount on the trade in so that you really aren't saving anything. but if you are looking for convenience and don't care about maximizing your value then just trade it in.

handsome · #6 09-12-2005, 10:17 PM

Wait til December 31. Get the low-end retail value for your trade-in, take the difference between that and the invoice price for the new one, and that's what you should be paying. BTW, sticker prices are usually wayyy overpriced.. you prolly could've gotten the Civic for $13k or so.

jason_t · #7 09-12-2005, 10:21 PM

[ QUOTE ]
1. Dont trade the car in, sell it privately, the time you take to sell it will be worth the cash.

[/ QUOTE ]

The Kelley Blue Book trade-in value for my car is $12100 and the private-party value is $13700. I'm not sure if $1600 is worth the effort and time that selling it privately would require.

[ QUOTE ]
Other than that, know what you should be paying for the car, and really low ball it.

[/ QUOTE ]

How do you find what you "should" be paying for a car?

STLantny · #8 09-12-2005, 10:23 PM

Through contacts, or the web. I know a couple people that own car lots, so I just ask them what a particular car goes for at auction (normally lowest price the dealer can pay). 1600$ is 1600$ for waiting a couple weeks, and doin nothing, and you maybe able to make more....

jason_t · #9 09-12-2005, 10:23 PM

[ QUOTE ]
trading in is almost always going to be worse than selling if you are looking to maximize your value.

[/ QUOTE ]

Yeah, I understand that. What I mean is I want the convenience of trading in without feeling like I'm losing a lot of value on my car.

jason_t · #10 09-12-2005, 11:43 PM

[ QUOTE ]
Wait til December 31. Get the low-end retail value for your trade-in, take the difference between that and the invoice price for the new one, and that's what you should be paying. BTW, sticker prices are usually wayyy overpriced.. you prolly could've gotten the Civic for $13k or so.

[/ QUOTE ]

How do you figure? $13k seems so far below the hidden invoice price I don't see how the dealers could turn a profit on that price.