Car Wheelin' & Dealin'

If you read my previous post, you know I am into jujitsu. But no, I'm not going to tell you how to throw the car salesperson to the floor, even if you want to. Instead, I suggest you borrow from the things I learned living in a family of nine people. And believe me when I tell you I use those skills every day.

Start with a plan

Rash decisions in a large family rarely turn out well. Mom and Dad didn't like it if you just snatched a toy from your brother or sister. They liked it even less if you had to punch them in the arm to get it. No, you had to find a way to get them to gladly give it to you.

The same is true of buying a car, particularly now during the COVID-19 Pandemic. Appointments are generally required. Test drives are now done without the car salesperson with you. But just like noticing a sibling was getting tired of playing with the toy you wanted, COVID-19 can provide you with the best time to get a great deal. It all starts with this plan.

Get pre-approved

OK, not sexy but very smart. By getting pre-approved for the financing before you shop, you will have a clear budget to work with. Another key thing to consider before shopping is deciding on the shortest auto loan term you can afford, not the longest. Why?

Because the faster you pay-off the car, the less you pay in interest and the shorter the time period of negative equity exposure, which is the time you owe more on the car than it is worth if you had to sell it. Yes, there is GAP insurance to protect you and the Credit Union has a great plan. But we are talking dealing here, so the lowest cost is the objective.

Know the vehicle and your choices

This is a little trickier since you want to limit the time you spend at a car dealership. But you will save yourself time and money by reading up on the cars you are thinking of. Type in the name and model of a car into your browser window and voila, up comes a list of all kinds of sources talking about that vehicle. Some might even have online videos of test drives. I recommend reading the reviews of well-known car magazines, which all have websites. These professionals can give you invaluable feedback.

Most importantly, you can learn of the pros and cons of the cars you are considering. Nothing is perfect, so just make sure the vehicle you are considering will be the best for what you want to use it for.

The SUV is the most popular vehicle now, by far. Since they are a taller vehicle than a sedan, you have a more upright seating position, are easier to get in and out of and generally have better visibility. But a station wagon could actually do the same thing, have better gas mileage, be easier to park and nicer to drive, particularly on a windy day. A hybrid hatchback style car could do the same or better and be a lot more fuel efficient. And a minivan can carry more people or stuff easier and more comfortably. Just keep an open mind but fixate on what the vehicle must do well for you.

Growing up in Chicago, an area with real winters, four-wheel drive made a lot of sense. But in sunny So Cal, about the only time you roll wheels on snow is if you drive up into the mountains. I say this because there is no sense in buying a feature you won't use. Conversely, if off-road driving is something you will do, then don't consider anything without an excellent 4-wheel drive system.

Warranties can be a key deciding factor, too, since no one wants large car repair bills. These will differ between car manufacturers, so get to know what they cover and for how long. If you are buying a used car, the rental car agencies typically provide a short, 12-month warranty on the drivetrain. WPCCU does have a very robust extended warranty option you should consider, too.

Once you have narrowed down your choices, pay attention to all the options available with the vehicle. Decide what you definitely want and also the options you can live without. Be picky, because you want to get exactly what you want for the lowest price you can get it for.

Sell your car privately if you can

No, this is not as convenient as merely trading the car into the dealer. But they will almost always pay you less than what you can get for your car if you sell it yourself. Getting a trade-in for a low wholesale amount is just another way the car dealers make money. With so many ways to sell your car online today, it can be a lot easier than you might think, even during the time of COVID-19. Use one of the many car valuation websites to know what your car is worth.

Add value to the sale by providing all repair receipts. Consider providing a car history report from an online source (there are several) showing it has not had any accidents or ignored recall items. Yes, you will have to take precautions for COVID-19, but that is the world we now live in so it should be nothing new to you. Throw in a COVID-19 clean detailing to help close the sale if need be. Don't think for a second this is a cost a dealer won't pass along if purchasing a used car. You can save your buyer money and make sure they know that.

Work the numbers for a cash deal

Pre-approved? Check. Car model and options? Check. Current car sold? Check. Shop the Internet. Many of the car sale websites can provide you with an estimate of the invoice price the dealer paid for the vehicle. It's not always accurate, since it will not include sales incentives the car dealer might have earned from meeting sales targets. But it is always good to know what kind of cash the car dealer is going to make on the sale. Knowing their income target helps get to your target.

Or if you are buying a used car, again use the car valuation websites to determine a reasonable price for the vehicle. Since business is business, it is only fair they make some profit. But just not a huge number, OK?

Now dig around for any auto manufacturer incentives or rebates if buying new. And here is a key tip. Do not let a car dealer insist upon getting the window sticker price because of the incentives. Since you are pre-approved and your car is already sold privately, you are a cash deal. And cash screams louder than your little brother in a headlock when it comes time to close the deal.