Car Buying - Monthly Payment
Approach
Let's face it.
The vast majority of people buy cars based on car monthly payments
approach. If the payments fit the budget... Right? Very few people
walk into a dealership and negotiate strictly from a cash position.
From a sales
perspective, getting a potential buyer to commit to a monthly
payment or payment range is the primary goal of an automobile
salesperson.
As a buyer you should never try to get your best
car deal negotiating from a monthly payment goal.
If you do this
(and many do) you will probably be one of those who contribute the
one of the highest profit margins for the dealer.
I sincerely hope
that after visiting this website, you will understand how important
it is for you to understand that what you need to know is...
that if I finance (trade difference) this amount of money for this
amount of time; my
monthly payments
will be where I need them.
Knowing this you can negotiate the two numbers that will get you
there. The selling price of the new car and the dollar amount the
dealer will allow you for your trade. Neither the salesperson nor
the sales manager should have any idea what you want your monthly
payments to be. All they need to know is what they have to
accomplish trade difference wise to get the deal done.
Don't make a
boneheaded mistake and walk into the dealership and explain to the salesman
that this is where I want my monthly payments, can you help me?
And if the sales
persons inquires as to where do you need to be
monthly payment wise to make the deal. Politely tell the sales
person that "let's stay focused on the selling price and the trade
and I'll let you know when we get there."
Sorry... but not knowing the numbers
you need to be at to achieve your (unspoken/unadvertised) monthly payments is
just plain stupid.
Stay focused
on the price of the car. The sales person will probably continue to
ask and probe for a monthly payment commitment... It's their job.
Don't feel offended as they will probably continually turn the
conversation that direction.
Do not give in. Again, just let the
sales person know that when you feel good about the selling price
and the trade value on the
two cars (the new and the trade) you are sure that your monthly
payments will be where they need to be.
Getting you
to commit to a monthly payment (actually a 'payment range'
commitment is pay dirt for the dealer) is known as structuring the
deal or teeing it up for the F&I person; who is waiting to take their
whack at you.
By getting you comfortable and feeling all warm and
fuzzy about a payment range the salesperson is merely trying to
mentally raise your payment expectation level and desensitize you to
the numbers.
Dealers know that
they have a very good chance that they can bump your payment
expectations (and their profit) by structuring a deal where you feel
good about a 'payment range'.
If you put yourself in this box its just
about kings X for the dealer.
I mentioned
teeing it up for the F&I person.
Here's why dealers and salespeople
really like you when you are a payment range type of buyer. When you
get comfortable with a potential deal based on a payment range,
there is going to be some payment padding figured into this.
When
you sit down in the F&I department on the final leg of the deal, if
the sales person has a bit of padding in his payment range quote,
then the F&I person will gladly show you some of the little extras
they can add to your contract (F&I people are sales people. They too
are responsible for sales and profits and their job depends upon it)
and hardly affect your monthly payments at all!
Imagine that!
Next
Car Monthly Payment-Big
Mistake
|
