Three Things to Know Before Sitting Down with an Auto Dealer

MAY 15, 2014

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Summer is just around the corner and like many, you might be dreaming of cruising in a new car. Many dealers are motivated to move inventory as new-year models debut but theyre still likely to be concerned about making a profit. And of course you want to pay as little as possible for your new vehicle. Before you head out to a dealership to begin negotiations, you should know these three key pieces of information:

1. What you really want.

Your budget and your head may tell you to buy that gas-sipping sub-compact. But if you dont have a specific make and model in mind, budget and list of priorities, it will be much easier for a salesman to sway you toward that continent-sized, costlier SUV hes trying to get off his lot. Know what you want, need and can afford before you leave home and try and stick to your guns at the dealership.

2. The actual cost of the car youre buying.

Every car has the potential for more than one price. Theres what the dealer paid to the manufacturer for the privilege of selling the car, theres what the dealer may put on the sticker as a starting point for negotiations, and then theres what the vehicle might really be worth. Arriving at that last number can take some research on your part, but its important that you know that price before you go shopping. Also keep in mind, there may be associated costs such as taxes, registration and car insurance. Understanding the true cost of a vehicle can help you possibly avoid overpaying.

3. Your credit score and credit status.

Even if you plan to wait until you get to the dealership to arrange financing (and we strongly recommend you dont), knowing what your credit score says about you in advance can help ensure you get fair terms for your auto loan. Understand your credit score and report before you begin shopping. If possible, line up financing options before you go to the dealership. You can always consider the dealers financing offer, but knowing your credit and having a backup plan can help ensure you dont have to rely on the dealership to fund your purchase.   Good credit scores can also lead to higher credit limits and lower interest rates.

This article is provided for general guidance and information. It is not intended as, nor should it be construed to be, legal, financial or other professional advice. Please consult with your attorney or financial advisor to discuss any legal or financial issues involved with credit decisions.

Published by permission from, Inc., an Experian company.     © 2014, Inc.   All rights reserved.