How to negotiate car prices

Buying a car is hard, but negotiating is harder. Here are 6 tips for negotiating a car price.

  1. Do your research first: Before you head to the dealership, do your homework. Try Kelly Blue Book or Autotrader to find the MSRP, manufacturer’s suggested retail price or research dealers in your area for special incentives they may offer.
  2. Know what you can afford: Establish you budget. Take the time to evaluate how much spare cash you feel comfortable putting down.
  3. Leverage the Dealer’s Cost: Rather than negotiating based on MSRP, keep your bid focused on the dealer’s invoice cost, or the car’s book value.
  4. Know your trade-in value: If you plan to trade in your current car as part of the transaction, use KBB or Autotrader to know its worth before setting foot in the dealership. If your car is in good condition and in-demand model, you can leverage this during negotiations with the dealer.
  5. It’s OK to walk away: Prepare yourself for the possibility that you might leave without your desired vehicle that day. Don’t allow yourself to get pressured into a bad deal.
  6. After negotiating, read the paperwork: Remain vigilant before signing the paperwork and be sure not to skip the sales contract’s fine print for any fees and hidden costs. Don’t accept any unnecessary add-ons such as extended warranties, gap insurance, and tire protection.

Bonus: Be sure to also ask questions about any fees the dealer charges you, including destination documentation, title, and registration fees.

Happy Shopping!