It seems a recent poll has shown that car dealers do not make the majority of their money on the actual sale of the vehicles. Many people seem to think they make most of their profits on the re-sale of trade-ins, but that is not the case.
As a car shopper, once you have the deal worked out with your salesman and you are taken to the finance office, that is where you need to be on your toes. This is the place where all of the extras, features, taxes and insurance that you probably don't want or need are added into your loan agreement.
This is also the place where it is the easiest to get you to say YES. You are thrilled at getting the new car and in most cases, you simply tell the finance guy yes to all of those little things he suggests should be added to benefit your purchase. Normally, he does this by pointing out how smart you are and you wouldn't want to get caught without such extras.
It all seems easy enough, but when you roll all of those extras into your loan and finance it over 3-6 years, you are paying way more than you should be for the services provided.
The best advice is to do your homework before you go to the dealer. Know what your likely interest rate will be based on your credit score. Research all options for your vehicle before you get there so you don't get caught in the position of agreeing to suggested add-ons. And finally, always negotiate the actual price of the vehicle, not just what fits into a monthly payment for you.
Follow these guidelines and you can feel confident the next time you step into a car dealership to get that great deal.
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