[00:00] This tip will save you thousands when buying a car from a dealer. This one thing will let you walk away a winner or a loser if you don't play it right, and that's not all. I'll give you a couple more tips at the end to save you even more money.
[00:13] So are you ready to take control of your next car purchase? Let's make it happen. Okay, the first tip, and this is huge. You need to flip the script on the dealer. Now, what do I mean by that? Let me explain. You want to work the price from the bottom up,
[00:28] not the top down. The dealership always wants to work the price from the price they set down. You want to have the leverage in the deal, work it from the bottom up. I'm going to show you how to do that now. Now, let's say you want to buy this lovely 2015 camera with 41,000 miles for 21,895,
[00:44] but you don't like the price, right? So let's get it down. Now, in order to make this dealer the right operate, you got to head over to Kelly Bluebook and we're going to look at the trading value for this camera as if we were trading the car in to try to figure out what the dealer probably paid someone
[00:59] to get this car on their lot if it didn't come from an auction. Easiest way to do that is just to grab the bin, plug it in there, and hit go. And the next thing we'll do is plug in the mileage and the zip code. Click next a few times and get your value. Now, when you're trying to get the Kelly Bluebook
[01:14] trading value for the car that you want to buy, you want to check this out and look at the condition of the car. So go through the images. See if there's any obvious cosmetic or mechanical things that are listed with it. If not, just select good as a kind of a baseline or very good. Don't ever
[01:31] select excellent or fair. It's kind of too opposite end of the spectrum. So we're going to select very good in this case just to give them the benefit of the doubt and we'll bypass this form for now. And then you'll get this lovely trade-in value. Trade-in value for this car is listed at 14,886.
[01:49] So if I do some quick math on this, go back 21,895 minus the 15,899. If we're giving them the benefit of the doubt, that's still at least $6,000 that they've got marked up on this car from what
[02:04] they gave someone. And they most likely didn't give them anywhere near $16,000 for the trade-in. If you've ever traded in a car, I've traded in probably 40 or 50 different vehicles in my lifetime. I rarely
[02:16] ever see a dealer offer me trade-in value, especially high trade-in value. What they typically do is they come back and say, I'm sorry, we can't give you trade-in value. We can only give you black book or auction value for this car. And auction value tends to always be less than Kelly Bluebook trade-in value.
[02:32] The only time there's an exception to this is maybe from 2020 to 2022 or end of 2023 when there was a shortage in the car market. They actually were giving a little bit more on trade-in because used cars were worth more. But those days are over, we're getting back to normal here and this
[02:46] tip should work. And if you're really interested in checking this car out and you want to see if my theory is correct, you should look at the car that you're interested in, call the dealership that has
[02:58] the car that you're interested in, and pretend like you're trading in a very similar car. So give them maybe the same year, the same model and trim, maybe change the mileage by 5 or 10,000 miles one
[03:10] way or the other. And they will give you some idea, some ballpark estimate of what they would give you on a trade for that car. Now don't tell them you're interested in buying theirs. You just want to see what they're going to give you on trade-in value and you'll get a ballpark. This value over the
[03:26] phone is usually a little bit higher than what they would give you in person because they're trying to lure you in and bait you in to the dealership. But it's still a good gauge and you can still get an idea pretty quickly. Okay, so in this case, I would call the dealer actually, I would probably go
[03:41] look at the car first, see if I'm even interested in it, drive the car, go through a thorough inspection. And if it's a car you want to buy, I would offer them $16,000 for this car with a straight face. Be very polite. Don't be rude, just $16,000. And that's how you set the anchor. You set the anchor low,
[04:02] they wanted it high, so now you're working from a position of low and working your way up. You know, you're probably not going to get the car for $16,000 and that's okay. You have a little bit of wiggle room to come up. This also means you don't have to negotiate out all of those junk fees, dealer handling
[04:18] and all these other generations that people tell you to go through. If you get a good enough deal on the base price, then maybe paying dealer handling and some other etching fees and whatever, maybe they don't matter because you've saved thousands on the front end of this deal and you've changed the
[04:33] leverage. Now you do have to remember, be polite, be nice, be willing to walk away, be willing to even leave way to day, maybe a week, even a month. I've had car dealers call me back the next day, the next
[04:47] week, the next month and actually take a low ball offer that I gave them because I was polite, I wasn't rude. I just gave them an offer and writing and I had a price I wanted to stick to and they
[04:59] eventually called me. If they didn't call me, I was okay with that. There are plenty of vehicles to buy. You don't have to buy that one. And to prove that this works, I actually did this on a new vehicle or a tactic similar to it. I didn't have the trade-in value to go off of, but I still kind of
[05:12] played it off the invoice price, so check this email out. I sent this for dealer an email about an F-150 the MSRP was $51,000. Their initial email, their first email back to me, they said they would sell
[05:24] it for $45,849. I said that wasn't good enough. I sent the most simple email back. I said, hi Pamela, I might consider this if it's $42,000, but I think it's too much for a $2,023 XL. And this was sent just at the beginning of March, 2024. Said, let me know if that's possible or not. Thank you.
[05:40] She emailed back and said, let me talk to my boss and run some numbers. Then we had two more email exchanges. This one, she writes back and says, here are the numbers for the F-150. These are average. We can get you $43,000. And as you can see right there, attached in writing, they took a little
[05:55] picture with their iPhone or something and sent it to me in email. You can see $43,000 right here. Now, keep in mind, I only did about five minutes of work to get this email exchange going. I emailed
[06:08] some dealerships. I found a truck that I thought I might like and then just started a conversation. I did find a dealership that had more stock than another dealer. You can use leverage points like that to work in your favor on the deal. So, coming full circle and then we'll get to those other tips
[06:23] I was talking about. The number one thing that you need to take away from this is look at the trade in value of vehicles if you're buying a used vehicle or look at the invoice value on a new vehicle and you'll find at least how much leverage you can come from from the bottom up rather than
[06:38] working from the top down on the price. Works every time. If a dealer's unwilling to do it, you need to just find another dealer. And if a dealer tells you that times have changed and we don't have that much profit in these cars, they are lying. Trust me. And keep in mind, you will have more leverage
[06:55] if you go in person. I like doing things through email first just to try to filter out who I think is going to be more willing to work with me. But once you get in person, you should have even more leverage. Now, I have a couple more tips to help you out with some leverage points. First off,
[07:10] you definitely want to check to make sure that the car has like an auto check or a car facts report. Make sure it's clean. I always look for cars that don't have title brands, no accidents if I can find them. There are a lot of cars now with accidents, but it's just worth more if it doesn't have any accidents.
[07:26] If you find a car that's high priced and it has an accident history, stay away. There's no reason to even start negotiating. But if you find cars that don't have accidents and they're at a high price, there's probably a reason why they're a little higher priced than the ones that had multiple accidents.
[07:40] So okay, the next tip is to look at the dealer handling fees. If your dealer is tacking on another five or six hundred or seven hundred dollars onto the dealer handling of the car, what you can do is say, can you please provide me with your dealer handling report? I want a detailed report of what you
[07:56] spent money on. If they don't provide that, that might be a red flag that they're a little shady. Most dealers will provide you with some inspection report and even if it's fake, they'll at least try to
[08:08] identify what they put their money into. So if they say that they put new tires on the car, but you see that there aren't new tires on the car, that'll be a point of negotiation for you. Same thing with brakes or anything else. The next tip that you can do is you could say, I want to take this car to get it
[08:24] inspected by a mechanic. I assume you don't have a problem with that. They shouldn't have a problem with that independent mechanic, not the one at the dealer and see what problems they come up with. A lot of the time independent mechanics will find all sorts of things that the dealer didn't find
[08:39] or just anomalies that you didn't catch when you were doing your inspection yourself. So get that inspection from another mechanic. Then you can take that, take it back to the dealer and use that as leverage for more negotiation off the price that you've already hopefully negotiated down to a
[08:55] reasonable price. Now you're stacking multiple different things. You got them down on that initial price. Then you're negotiating this extra inspection and anything that might come up in the inspection.
[09:07] It's a used car. They don't have warranty, so you want to definitely get an inspection. You don't want any surprises. And the last tip I have for you and maybe this should have been at the beginning, but whatever, is check a site like Car Complaints or other sites out there that have reliability data.
[09:23] No matter how bad you want a car, just because it looks cute or sexy or whatever, please go check and look at the reliability history of that used vehicle and just see what the track record is. And you'll see
[09:35] websites all over Edmunds, Car Complaints, many different websites and they'll list out cars that are known good cars, known good models and years. And you can find those drilled down. And
[09:48] maybe it's not the exact car you want it, but you'll probably be a lot happier down the road if you don't have a lot of mechanical problems. After you buy a car and you spend the money, think about it, three to six months down the road, what happens? The car gets dirty, it gets dinged or keyed or whatever.
[10:05] Eventually, you're not caring about the looks of the car as much as you are. The mechanical and reliability just point A to B transportation. So that's just something you have to consider in the purchase and it'll pay off down the road. I'm coming out with a guide here soon and I'm going to
[10:20] actually include something like this in the guide. It's going to be just a full guide of how to research car reliability, how to focus on good cars instead of bad cars and what to look out for. You can do inspections yourself if you don't want to pay a mechanic. So that's all coming up in a
[10:35] free course, not completed with it yet. So I still got a lot of filming to do. Anyway, sub up if you want to see that and we'll catch you in the next one.