How to Buy a Car the Right Way

Published by MaxBro on Tagged Features

How to Buy a Car the Right Way: A Deconstruction of the ‘13-Step Method’

If you are in the market for a new car, I urge you to check as many sources as possible for tips on how to find the best deal. Ask around, talk to people who have been through the process, especially if they are folks of the gray-headed variety. However, do not under any circumstances use the ‘13 Step Method’ provided on Consumerist.com.

Rarely do I come across an article on the web so egregiously wrong, so full of bad information, that it literally causes me deep and abiding concern for those who may not be wise enough to ascertain its obvious shortcomings. For this reason, I’ve written the following deconstruction to the purported ‘13 Step Method for Buying a Car While Controlling the Sale and the Price.’

But first, a little background information on myself and why I feel justified in offering any advice whatsoever on the common yet momentous decision-making process behind the car purchase. From April 16, 2007 until June 26 of the same year I worked as a sales consultant (just a PC term for salesman) for Saturn–the off-mainstream car brand currently famous for its “Rethink American” campaign, dent-resistant side panel doors (which are no longer a manufactured feature in all 2008 models) and popular “No Hassle No Haggle” policy. I realize two and a half months of employment is not a very long time, and indeed there are many people vastly more experienced than I who are perhaps better at offering advice, but a lengthy tenure in the industry in not a requisite for dispensing with the absurdities of the Consumerist article.

Further, while I may use specific examples from my Saturn experience, I have no stake in or attachment to the company, nor am I being paid to offer this counter-opinion.

Having given the disclaimer, let me also add that it is your responsibility as the consumer to seek out the best deal for you by using as many sources of information at your disposal. Everything written here is true to the best of my knowledge. If you have concrete proof of any errors, feel free to articulate them in the comment section, or write me at: deanmaxbrooks@gmail.com

Now, onto the deconstruction:

“1.) Pick the exact make and model of the car you want.”

That advice is naive at best and far easier said than done. When deciding on purchasing a new car, the very first thing you should do is determine what features are important to you. This is especially true if you are on a budget, or have recently encountered a distinct life change (i.e. pregnancy, divorce, move, etc.). So, what are you looking for? Do you want something with power, gets good gas mileage, an SUV that fits ten screaming kids, or just something that will make you feel sexier driving down the street? You (and your spouse if applicable) know your needs certainly better than any salesman, and so it falls to you to determine what fits and what doesn’t.

Next, narrow down your choice of cars based on those needs. Obviously, if you have your heart set on a convertible, then that’s all you need to look at. But no one who ever intelligently bought a convertible (or any car for that matter) will tell you they settled on one particular model without test driving it first. There are some exceptions to this when it comes to gifts, or to higher end vehicles (like a Corvette), but the vast majority of people need to feel that wheel in their hands, smell the fresh interior, and kick the tires before settling on one brand over the next.

So, while you need not settle on one particular brand just yet, make you sure you understand what constitutes value for you in a new car. I recommend you write down a list with perhaps the Top Five Things (more if needed) and keep that list handy during your visits to dealerships.

“2. Call around first anonymously (such as calling from work on your lunch hour), and get prices. Tell them you are calling everybody, and the best deal wins. Write down the prices you are given, and note any difference in packages.”

This is so dangerously absurd I almost have no idea where to begin. Under no circumstances should you fraudulently call around like a con artist. You will do nothing but waste a salesperson’s valuable time and your own. Many dealerships have a revolving door when it comes to employment, so who you talk to on the phone may have no idea what’s going on price-wise at the moment. The majority of inbound calls are handled by newbies who are typically over-eager to get that sale (it may even be their first). Veterans are likely to have their own client base and typically do not need to work the phones as much as their lesser counterparts. In some companies (Toyota, for instance) only newbies staff the phones while those who have proven themselves are the ones out on the floor making deals.

Newbies will tell you anything just to get you in the door. How do I know this? Because I used to be such a newbie and in every meeting the management repeated their number rule for working the phones: Get them in the door. Get their name, phone number, names of their children, their dog, etc. You get the idea. If you rely on the phone as a means to investigate a car sale, chances are you’re relying on half-truths, inexperience, sales schemes, and at worst outright fabrications. There are really only three reasons you should use the phone: 1.) After you’ve established a rapport with a salesperson you are comfortable with, 2.) To verify that a specific vehicle is currently on the lot, and 3.) To schedule a test drive (or “demo”) or otherwise verify information seen on the dealership website.

This brings me to the solution to the phone dilemma: do your research primarily on the web. It’s really as simple as that. Go online and visit the corporate websites INCLUDING all the local dealerships you plan to visit. This is a much more convenient, practical method, not to mention honest, over the Russian Phone Roulette as offered by The Consumerist. Just about every major car company out there keeps an accurately updated website, and so you are more apt to find crystal clear facts on the website than you certainly will over the phone. I understand that for many young people this suggestion may seem obvious, but for many older folks the internet is downright scary. If this is your case, then ask for help from someone you trust to help you research the web to find the right car for you. When you find some data of value, print it out and highlight the important parts. Be sure to include this with your note of Top Five Things as mentioned earlier. You may even want to keep a folder to take with you and include anything of importance about your future car.

Now, you probably noticed I capitalized every letter in the word “including” earlier. This is because many times a price you see on a corporate website may be entirely different than what you find in your local dealership’s online inventory. So it’s very important that you check out both. Typically car companies like to use “Build a Model” widgets in their sites to help you calculate a price on your desired vehicle. While these widgets are immensely valuable, and fun to use–if you’re like me you’ve built your share of fantasy Porches online only to gasp at the final price–they don’t often give you the actual price. I can’t tell you how many times customers (or “ups”) came to me on the lot with some pre-determined price in their mind based on something a widget produced, only to discover that their “price” was no where close to reality. Widgets tend to overlook several things like dealership profit margins, shipping costs, corrected interest rates, or special deals a shop may offer for a limited time or for a holiday.

They also overlook something very significant: Your credit rating. It’s easy to pick between choices like “Good, Fair, or Poor” as oftentimes offered on those troublesome little widgets, but when it comes to the actual paperwork, you’ll find your credit becomes a grayer issue to manage. Just think of those widgets as little salesman that like the newbies on the phone, are really just working to get you in the door.

Further, a widget on Ford’s corporate website may give you one price for a Taurus, but when you research your local dealership inventories, you won’t find one Taurus that even comes close to that price. This is quite common but it does not mean a national car company is trying to deceive you. National Ford commercials or website widgets may not account for state and local taxes specific to your area. They are only giving you the price before retail value, so it’s up to you to dig into the small print and discover the actual taxes for yourself. I’m convinced this is why so many people fail at car buying. There are simply too many details to examine, and we all know which malevolent being is in the details.

“3. Pick the dealership you think you want to do business with based on the results of this phone call. Price should not be the decider — demeanor and gut feel should be….”

If you subscribed to my reasoning in the number two post, then you will quickly realize why this advice from Consumerist is equally ridiculous. Folks, you do not have to pick one dealership. You are free to visit them all. I say make a Saturday of it and visit as many as you like with your friend, girlfriend/boyfriend, parent(s), grandparent(s), or whomever you want to share the day with. Buying a car should be a fun, rewarding experience, not something you plan for like a covert operation.

Just make sure you keep those Top Five Things in mind with each visit. I’m not saying you should browse each dealership like a lost puppy and waste every one’s time. Ask questions, learn something new at each place you visit. You’ll find that in many instances salespeople are just happy to have someone to talk with for the day, and are even happier to know you are currently in the market for a car. As a former lot lizard (salesperson who walks the lot) I always looked forward to meeting someone who was interested in learning about a specific car, and having the chance to show them one was typically an education not only for them for for myself as well. I learned something from each encounter I had.

So, don’t be afraid to visit as many lots as you like. A good salesperson is one who is truly interested in seeing you find the car you want and can make you feel welcome no matter if you say you’re thinking about buying a car from another lot. They are out there, and I encourage you to talk to as many as you need to until you click with the right person and you’re at the dealership that has the right car for your needs. If you don’t visit there only going to talk to someone else or play solitaire or surf the web and download zany videos (a common pastime to salespeople much to the chagrin of management) You’d be surprised how many times people have chosen to purchase a car simply because the salesperson took the time to show them what they asked for and made them feel special as a customer and as a person.

In regards the parts about the “phone call.” If you are calling anonymously how can you schedule an appointment. Further, how can you even be sure you’ll be able to work with that salesperson again in the event you decide to visit their lot? They may be busy when you arrive, or have the day off. Then what? You’ll have to work with someone you didn’t expect and then they have the element of surprise. Again, buying a car is not a covert CIA operation. You are not meeting in a dark alley wearing a trench coat delivering secret nuclear missile codes. You’re buying a car. Don’t over complicate things.

“4. Go to the dealership you absolutely NEVER want to do business with. Nail down the details on the options — go for “loaded,” then whittle it down to find the approximate prices for each option. Make a detailed list with prices. Mark the options you must have and those can do without.”

I don’t think I saw one comment from anybody in the feedback for this article either on Digg or The Consumerist website that agreed with that point. It’s completely stupid and there is no need to further justify its unending absurdity.

“5. Do your research online and compare your pricing research with others and experts. Set an “ideal price” and an “I can live with it” price for the car you want with all the options you want, and again for the car you want with the minimum options you want. You now have a low and high figure for the car.”

Finally, a point that makes sense. This is completely in line with what I wrote above in posts number one, two and three. I would add that this point on the part of the Consumerist makes the earlier four null and void, further confusing me on how this article ever made the front page. When you’re not even half-way through an article and you’re already contradicting yourself on the only major points you’ve made thus far, you’re in trouble. Let this be a lesson in why website admin should not publish half-baked things rattled off in the comment section. Comments are not written in the manner of an essay or article. Comments are oftentimes haphazard, scattered and fragmented little jesters of tone and thought. I fully admit I’ve written enough absurd comments on various sites to know this.

“6. Go get cash or a pre-approved car loan for something less than the upper amount. Put the cash or check in a blank sealed envelope. Find out ahead of time how to deal with the pre-approved loan if the negotiated amount is less than the amount on the bank check. You do not want to have to leave the dealership to get a new check for a smaller amount, so try to arrange something in advance for this contingency.”

All the evidence I need for knowing the author of that article has no idea what he’s talking about is contained in the above statement. Why in the world would you carry around thousands of dollars or a pre-approved check from a bank if you aren’t even sure what vehicle you’re buying? Not only is it completely unnecessary, but it’s dangerous and foolish, too. Carry an envelope with cash and you face the risk of losing it all if you get mugged, or the potential threat of identity theft if it’s a bank check.

The vast majority of people do not make a decision the first day on the lot. Sometimes it takes several visits and many weeks before a sale is made. I served one customer who took six weeks to decide on a vehicle. He visited the lot a total of five times, took three separate demos, called me late at night, on the weekend, on my days off, you name it. It takes time and by no means should you ever rush into anything or go packing a wad of cash until the appointed time. Even after exhaustively researching online, there is no substitute for actually visiting a dealership and taking your car or cars of choice out for a drive. Some dealerships will even let you take a car home with you. If that is an option, feel free to exercise it, but understand you may have to provide identification and/or submit to a credit check or other measures (Check with your local dealership). The amount of cash you have on you has nothing to do with what kind of deal the lot may offer you for a vehicle. It’s not like they’re going to peer into your wallet and then say “Hmm…well you’ve only two thousand dollars I see, so you can forget about that sweet deal we just talked about!”

But here’s something very important. Quite often, the perks of a deal a lot offers you are based on you qualifying for a loan through the dealership’s bank. This is actually a good thing and often ends up the best deal for the customer. Almost no commercial bank can offer you 0% interest or low interest as your dealership’s bank can. In almost every case, whenever you see a dealership offering a low rate in their commercial or printed advertisement, it’s coming directly from their bank. For instance, Saturn is owned by General Motors. General Motors offers low interest rates through its subsidiary bank GMAC. As a salesperson at Saturn, in every instance, unless someone was paying full in cash, GMAC always offered my clients a superior interest rate than their banks of choice. The only problem I ran into was that because GMAC has moderately high credit standards, a lot of people had trouble getting qualified for those good interest rates. However, if you’re not able to get a decent rate from your dealership, that is a reflection of you, not them. Dealerships often do everything in their power and even cut their profit margins down to the quick to qualify a client with troublesome credit. But it doesn’t always work despite the best efforts. Out of the whole process of buying a car, the credit issue usually has the most drama.

Also, in regards getting loans and such, why would you want to put any money down on a car if you’re able to get 0% interest or little interest at all? 0% is essentially free money because you do not have to pay back any fees to borrow the money. Unless you just love your bank and feel you must remain a loyal customer to get that free toaster or something, you’re best option is usually the corporate bank your dealership works through.

“7. Call your insurance carrier and tell them you are buying a new car. Do as much of the paperwork ahead of time as possible and determine the hours they can service you so you can avoid delays or surprises at delivery time. (Any delays benefit the dealer.)”

Let me address the part in parenthesis first. Any delays DO NOT benefit the dealer, they only antagonize your salesperson who is often the one who must call your insurance company to verify that you have insurance after you’ve purchased your vehicle. The dealership has nothing to do with your insurance other than to verify it as required by law. There may be variations depending on your state and I advise you check with your local laws to verify them yourself. Otherwise, car insurance is <i>your</i> responsibility. It is up to you to find out how much (if at all) your insurance rates will change when you buy a new car.

The best thing to do is call your insurance company after you’ve settled on a specific car and find out your new rate. Your company may even have a widget that does this on its website, but remember our troublesome widgets from above. They are rarely trustworthy. Also, keep in mind that many insurance companies offer discounts for things like car alarms, OnStar, side curtain air bags, etc. This is where the dealership can step in and help you by making sure you know all the things that come installed on your car. But don’t go asking your salesperson to estimate your insurance rate. There are a hundred things that go into factoring your rate like your driving record, age, DUI arrests, gender, location, etc, and there is no way he can give you an honest answer (and if he does, he’s only guessing).

So, if you are particularly cost conscious (as most car consumers are), make sure you calculate the cost of your new insurance rate into the total cost of your new car. You don’t want to have a great interest rate undercut by a higher insurance rate.

“8. Go to the dealer you want to deal with — on a weekday, in the morning. Get dropped off or, ideally, have a friend or significant other go with you. (It always helps to have a witness.) Bring a sack lunch and drinks with you. You’re not leaving or letting your attention wander until you have a car.”

Having a witness is not a bad idea, but the rest of the above suggestion is really up to you. Sometimes a car deal can take several hours and it doesn’t hurt to bring some food along during the stay. Don’t bring a bag lunch, though. That’s just silly. Really, if you get that hungry just tell your salesperson you’re going out to eat at a nice restaurant to think things over and you’ll return when you’re finished. He may even offer to buy you lunch just to keep you on the lot.

Unless there is a deal going on, it usually doesn’t matter what time of day or week you go to the dealership to do the deed. My only suggestion would be to go when you’re comfortable and be sure to have fun when you’re there. Bring a friend, or the whole family. Heck, call extended family and have every member of your clan asking your salesperson probing questions about your new vehicle. Make it memorable event. After all, you and your car are going to be pretty close friends for possibly the next few years.

9. Find the exact car you want. Use your list…this shows you’ve done your homework. Don’t be surprised if your salesman suddenly has to handle an emergency and hands you off to someone else. This is a good sign that you have the upper hand already.”

Firstly, I don’t see why the author feels the needs to repeat “find the exact car you want” here again after first saying it in Point Number One. Obviously if you’ve come this far you have settled on a particular vehicle that is within your budget, and is something you can at least tolerate driving for the next few years or so.

Second, do not automatically interpret your salesman leaving as you “getting the upper hand.” Unless he’s a newbie, he’s definitely not leaving because he’s scared or intimidated by you. He may leave to find out information you’ve asked him about earlier to which he did not have an answer. Or because he has other clients scheduled. He may get up and leave just to go to the bathroom. Salespeople are people too. Who knows. But sometimes dealerships have little inside rules that dictate the process of a car purchase to the salespeople. At Saturn for example, we were required to introduce all new clients to the sales manager. This was called a turn-over or “T.O.” Other dealerships may have rules that say the General Manager must meet each prospective car buyer. Sometimes after you warm a customer up, it’s a good idea to enlist the services of a veteran salesperson to close the deal. Or perhaps your salesperson sensed you weren’t interested in buying and decided to pursue someone else. That happens a good deal, especially during holiday sales when customers flood the lot and commissions are dramatically at stake. There could be any number of reasons why your salesperson walks off, but do not assume anything because you don’t know the little inside rules and idiosyncrasies working behind the scenes. Certainly do not assume you’ve won anything.

“10. Show them the envelope. Tell them you have cash/a pre-approved loan check, and three chances to get it from you if you can drive out by an exact time (by 3 PM is usually good), all paperwork done, taxes paid, and every other fee under the sun taken care of for less than the amount in the envelope. Do not give any hints about the amount, make them name heir price. If it’s way out of sight, don’t say anything. Just laugh and head for the door. They’ll chase you down and give you a much better number. If they don’t, go elsewhere.”

I’ve tried to restrain myself as best as I can, but this is just absurd. No, it’s stupid, idiotic, foolhardy and completely asinine. Who would do something like this? I have never once seen or heard anyone ever doing this. If someone had ever walked up to me and done what this guy just suggested I would have laughed my ass off. It’s just not done this way at all. I swear, this is almost like a skit you’d see on SNL or The Daily Show, except this isn’t funny by any means. It’s classless and completely unnecessary.

I’ve given all my reasons for why you do not need to stroll into the dealership with a pre-approved check from your bank. And common sense should certainly dictate why it’s not a good idea to carry lots of cash on you. Who has loads of cash to withdrawal from the bank anyway? And who walks around with loads of cash in their pockets no matter what kind purchase they’re making? Hasn’t this guy ever heard of debit cards, check cards, credit cards, traveler’s checks, or money orders? What does he think, that you’re going to walk up to a dealership with a big bag with a dollar sign printed on the side of it like a prop out of Looney Tunes?

11. Read everything. Twice. Have your friend do the same. Line out anything you don’t agree to or doesn’t apply, initial and date this and have the dealer rep do the same. Do not leave any blank spaces. Count the papers and make sure you get copies of all of them. Ask if there are any programs you need to opt out of to avoid being automatically signed up for them. Do whatever is required to opt out.”

I am all for reading the fine print to make sure you don’t get shafted by hidden fees, but I’ve never once seen someone sit there crossing out this or that and initializing here or there. If you don’t like the terms of your contract, make them offer you another one and they’ll print you one out using the miracle of modern technology. But understand that unless your credit is perfect, or your paying in cash, the dealership is oftentimes restrained by the lending bank due to your financial health.

As for “programs” that require opting out of–I’m not even sure what the author is even talking about there. These days many cars come with tons of options that deal with safety, maintenance, or other things. Of course, there is a world of difference between purchasing and leasing a car, so be sure you understand what you’re getting into no matter what kind of deal you have. I’m guessing “programs” may refer to extended warranties and things like that. In that case, absolutely make sure you don’t sign up for something unless you can afford to have it and/or you need it. Most extended warranties and other extra things you have to opt-into in order to have, so unless you really aren’t paying attention and your kid grabs hold of the pen, there shouldn’t be much too worry about there.

However, I am not denying that some dealerships don’t try to slip in things at the last second, or perform underhanded tactics just to get more of your money. I had the good fortune of working for a very reputable dealership with solid integrity. Obviously this is not the case everywhere and if you are really paranoid about getting screwed over, or think your dealership may be trying to pull a fast one, or if you just aren’t an avid reader of contracts and they all read like pig Latin to you, then have your dealership print everything out, and show it to your lawyer.

“12. If at any time they give you attitude or BS, walk out. They will chase you down. Tell them they have only one chance left because they gave you attitude. Now they will deal. If they don’t, go elsewhere.”

This neglects to mention that some car companies have the “No Hassle No Haggle” policy. Namely, Saturn and Carmax. This philosophy of offering customers direct sticker price is fast becoming in vogue with the rest of the industry, and I expect it may spread to other places too.

Also, remember what I said about your credit and financial health. You have to remain realistic when you’re buying a vehicle. I’m not saying salespeople don’t get attitudes or the sales manager won’t try to push you around. When I first started my trainer made me visit several nearby competitors to see how it felt being a consumer. I learned something very important; you will meet all types of people when you go looking for a car. Some are nice, some are not. Some see you as nothing more than a wallet with legs. Others see you as a human being with wants, needs, and desires. Some will smile to your face but insult you behind your back. Some will remember you years after they meet you. You have to be careful and maintain your guard no matter which dealership you go to, but keep in mind that sometimes a deal is just not meant to be. This may be your fault or it may be the fault of a lousy salesperson who killed a deal by giving you attitude. But whatever you do, just make sure you get the deal that is right for you within realistic boundaries.

“13. Try another city if yours is full of slime balls.”

Another nonsensical piece of advice from this increasingly intolerable author. I thought that like how a snail can only produce so much mucous from its glands, he would eventually run out of dumb stuff to say at some point. Let me tell you, unless you live out in the sticks and the only dealership in town is Joe Schmoe Autos with a giant inflatable clown on the roof, if you cannot find a suitable dealership within a sizable city, then you are the slime ball with the problem, not the dealerships. Seriously, if you live near a major city, or even a smaller city like Houston or Memphis, finding a decent lot in your area should not even be an issue.

There is no perfect dealership, and you’re going to encounter snags no matter where you go. But if you find a good deal on a car you want, then go for it. Don’t refuse a legitimately good offer just because your salesman is an idiot. Most likely he’ll quit or get fired after you’re gone and you’ll never see him again. Besides, he has no control over your financial relationship with the bank. It’s not like the second you drive off the lot he’s going to dial his secret insider buddy at your lending bank and jack up your rates. I understand that you’re spending thousands of dollars and it’s human nature to want everything to go perfectly, but that rarely happens. Make the best of your situation and stay realistic. You may have to make trade-offs here and there to get what you want, but at the end of the day you’ll have your brand new car.

Finally, I wrote this piece because I felt a strong need to correct the gross inaccuracies in the one originally posted by the author. I’m quite sure the author had good intentions with his points, but that doesn’t mean what he wrote is good advise. In short, his list is nothing more than a guide to becoming an intolerable customer no one will want to deal with. You can’t have an inflexible attitude when you walk into a dealership. You need to remain fluid and capable of adjusting to new stratagem and data as they present themselves. You do that by educating yourself online, asking the right questions, keeping an open mind, and above all sticking to that Top Five Things list representing what is most important to you in a car. Never walk naked onto a lot, so to speak. The most frustrating customers I dealt with were typically the ones who had absolutely no idea what they wanted. While I am an honest person, there are those who would see that scenario as a perfect opportunity to take advantage of someone. If at all possible, get a good idea of the car you want before setting out on any demos. If that’s not possible, at least know what you don’t want in your new vehicle.

I don’t profess to be an expert on buying or selling cars. My essay comes from hands-on experience and knowledge gleaned from those I met in the industry with knowledge that far outweighs my own. No doubt there are a hundred things you could add or points you could argue. I encourage you to consult as many sources as you can find on the web or elsewhere, and conduct your car purchase wisely. I hope this article helps.

(Originally published 9/6/07)

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