Guerilla War Negotiation Tactics Guide to Buying a Used Car

I recently bought a used car and I want to gloat about the great deal I got. I also want to share some of the techniques I used to get that great deal. I want to note two things before I begin: I would never buy a new car. New cars are terrible investments because of the immediate depreciation. I hate owning something that isn't worth what I am paying. New cars do have a slight reliability advantage (warranty) and come with that new car smell. Someday when I have too much money to care if I waste a little I'll start buying new cars. Most likely, I'll be too old to enjoy my purchase, and will be buying tiny red sports cars to boost my sagging ego. Second, I would never buy a car outright with cash because if I had that much money to spend, it would probably be best spent elsewhere. (A down payment on a house for instance)

1. Plan your Attack: Those of you who read this blog know that I recently returned from Iraq. The austere living conditions allowed me plenty of time to think and I was able to spend this time thinking about what I would do when I returned. I used the extra money I was earning at the time to pay of some old credit card bills I accrued in college and I managed to save up a little money. I even loaned my brother some money to pay tuition at college. (I am not however an angel, I spent the majority of the rest of the money on DVD's, XBox games, and expensive designer clothes. A shout out to my favorite online retailers Amazon, Bluefly, Levis, The Gap, and Figleaves. I should own stock in those companies considering how much I have meant to their bottom line.) Having good (well ok, fair) credit and a large down payment widen your options and allow you to operate from a position of strength.
2. Decide what you want: It is helpful to know what one is looking for in a car in terms of performance, gas mileage, price, mileage, etc before arriving at the dealership. One can quickly eliminate most of the cars on the lot and concentrate on just the ones you want. It is even more helpful to have a make and model already picked out. Even if you don't purchase the Porsche 911 you had your heart set on, the dealer can still get you a sweet deal on a car just like it since he has a good idea of what you like.
3. Take advantage of the kindness of strangers: Dealers offer various enticements to get you into the dealership. Take everything you can. I am not sure how eating free pizza or bumming a ride from employees of the dealership helped me buy a car but I had fun doing it.
4. Have no loyalty: If you have an existing relationship with lenders or dealers by all means take advantage, but you shouldn't hesitate to bolt if you can find a better deal.
5. Arrange financing beforehand: I lucked out on this one (because I didn't do it!) but knowing where the money is being borrowed from is an important part of negotiating from a position of strength.
6. Realize that your smiling salesman/saleswoman is probably a scumbag: If you trust the dealer and his sales staff too much they will take advantage. They have to. Sales personnel only make money when you buy a car and will do everything they can to sell you one. Dealerships are looking to maximize profits on every car sold and have no qualms about making a buck off of an unsuspecting customer. Besides, you should be intensely suspicious of someone who is always smiling. Especially, if his smile reminds you of a shark.
7. Do research: I got an assist on my brother on this one, but doing research will give you a definite leg up in negotiations since the dealer will have more difficulty swindling you of your hard earned money with bogus claims about the lemon sitting in his lot. The internet is critical for this since it is a large repository of impartial (ok maybe not impartial but at least you didn't get it from the dealer) observations about cars. You will want to compare prices for vehicles with similar mileage and age.
8. Take a friend or at least a cell phone: It is great to have a friend to play devil's advocate. When negotiating stop at intervals to go confer with your friend. Even if you are just discussing baseball, the sales personnel will get nervous and feel pressured to sweeten the deal. Your friend can interject at inopportune moments with comments like "I saw that car for a grand less at the dealership next door. I think we should leave." What can be even more effective is bringing a cell phone along. When negotiating terms for purchasing my car, I would call my brother up to confirm details the salesman gave me and compare prices. I even had him pay for a twenty-five dollar membership at Carfax.com so I could check the history of a car I was considering. The salesman actually thought I was talking to another dealership when I would call him to compare prices; I should have let him continue to think that.
9. Comparison shop: Once you zero in on the car you want, you will want to know if you can get a better deal elsewhere. There will almost always be a car with a lower price somewhere else. You can try this gambit: Choose the cheapest car you you can find within 25 mi. Of your zipcode on Autotrader.com. There will most likely be car several thousand dollars cheaper than the one you are looking at. This car will most likely be a lemon. That is fine. You can still use it as leverage during negotiations. The dealer most likely will suspect that the car is a lemon too and try to dissuade you from considering the cheaper car on these grounds. Make a show of checking out the car (Carfax.com!) and reporting that there is nothing wrong with it. Remember that just because you check a car on Carfax doesn't mean it can't be a lemon. Cars often have serious problems that go unreported. (A friend told me that one important thing to check for is rust. Have the dealer raise the bottom of the car so you can inspect the underbelly for rust). If the cheaper car is not a lemon and the dealer is reputable you can always save time by just buying the cheaper car. Or if you are a sadist like me and like to see grown men and women squirm you can wait around longer and continue negotiations. The object of any negotiations with a dealer should be to find the lowest price he can sell to you for. Your offers should be realistic but low enough to force a favorable compromise. Start with the price of your lemon or a random lowball offer and work up slowly. Ignore the sales personnel's petty tricks; my sales man tried to sneak a higher offer by me by offering a proposed deal that included monthly payments but omitted the most important detail - the overall price.
10. Be unconventional: Dealers resort to cheap theatrics all the time. Do not be afraid to use some of your own. I walked off the lot during negotiations no less than three times. I yakked on my cell phone to my brother about car prices in full view of the sales staff. I used a car with bald tires, a beat up paint job, and a rusted underbelly to force them to lower their asking price. I had fun doing it too.
11. Be ruthless: Negotiating to buy a car is like negotiating a peace treaty with the North Koreans. Neither side really trusts the other and has good reasons not to. You shouldn't feel bad about hardball negotiating tactics as long as you do not do anything overtly dishonest or illegal. The dealer is doing the same thing you are. All is fair and love and war; guerilla warfare and used car negotiaions are the worst.
12. Have fun: If I thought I could get away with it, I would sell the Jetta and buy a new car everyday. Just don't start gloating until you leave the parking lot. Car dealerships look askance at people doing victory dances in the back of someone else's pickup truck.