Cars
How To Find A Car’s Dealer Cost
by admin on Mar.17, 2010, under Car Tips, Cars
How To Find A Car’s Dealer Cost
Whenever you approach a car dealer, you can expect to spend time negotiating the final price. This is true for both new and used cars. The problem is that consumers are often confused about where to start negotiating. It’s understandable, especially given that there’s a sticker price, dealer invoice, and other terms that are used loosely in the industry. Each has a specific meaning and knowing them can be essential toward negotiating a better deal. Today, we’ll briefly explore what these terms mean. Then, I’ll show you how to find the dealer cost of a vehicle (the best place to begin negotiating).
Numbers Explained
First, let’s take a moment to clarify what some of the most common prices mean. Most people know what “sticker price” means. If you walk into a dealership and are willing to pay the sticker price for a car, there’s no need to negotiate. You can leave with your new car in minutes. Paying sticker price is obviously a bad idea (which we’ll discuss in a moment).
You’ve probably heard of the “dealer invoice” cost, but you may not fully understand what it means. It’s the dollar figure that car manufacturers print on invoices that are given to dealers for every car they purchase. However, there are often details under the surface of this dollar figure which aren’t disclosed to the public.
For example, automakers commonly give dealerships incentives and other deals to encourage purchase orders. Sometimes, the dealerships will transfer these incentives directly to customers, lowering the price of their vehicles. However, they’ll often keep the incentives and use them to preserve their profit margin during negotiations with prospective buyers. Ultimately, you may be proud of the fact that you’ve aggressively negotiated a price for your new car that is below the “dealer invoice.” In reality, the dealership can still be making thousands of dollars in profit without your realizing it.
Finding The True Dealer Cost
Knowing how much money a dealer truly paid for a vehicle is critical to negotiating the best price. So, how do you uncover this dollar amount? First, the dealer invoice cost is widely available. Some dealerships will actually offer it to you (though, acquiring it from an unbiased source is always preferable). Once you know the dealer invoice, you’ll need to find out what types of incentives, rebates, and cash deals were offered. Then, you’ll subtract those from the dealer invoice to determine the actual dealer cost.
You can ask a salesperson to divulge the information. But, some will be resistant while others may actually mislead you. The easiest way to gain access to the numbers is to use ConsumerReports or a similar resource. Once you’re armed with the dealer cost, you can negotiate a better deal on your new or used car.
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Can Your Auto Loan Provider Turn Off Your Engine?
by admin on May.06, 2009, under Car Tips, Cars
Can Your Auto Loan Provider Turn Off Your Engine?
Over the next few years, people who are thinking about purchasing a new vehicle may be in for a surprise. Many auto dealerships are outfitting new and used cars with devices which can deactivate the engine remotely. The reason: to make repossessions easier.
As more people lose their jobs, they’re forced to prioritize their bills. Some bills have to wait while others are put on top of the stack. Dealers and lenders want to ensure that their customers make their payments on time. The shut-down units that are installed into automobiles provide the motivation.
In this article, I’ll explain how these devices work and describe a few of the issues involved with their use. We’ll also take a closer look at how they can benefit customers, dealers, and lenders.
Safety And Other Issues
The shut-off component is installed onto a vehicle’s powertrain. Through telematics, a dealership or lender can remotely turn the engine off if the driver has failed to send in his or her payments. Currently, dealers are triggering the device only after a payment is several days late. Before the engine is deactivated, an indicator light will normally display on the vehicle’s dashboard. Some companies will allow the deadline to pass in order to give the motorist time to send a payment.
Drivers are understandably concerned that the shut-down device can be dangerous, especially if their engine is turned off while they’re driving at high speeds. Most dealers will only trigger the unit once the engine has been manually turned off or while the car is at idling speed.
Protecting Customers, Dealerships, And Lenders
The component was initially introduced for subprime borrowers. Car dealerships and lenders consider such borrowers (those with “B” credit ratings) to present more risk. In the past, they offset the increased risk by applying a higher interest rate to auto loans. The shut-off units offer an alternative.
By installing them on a car’s powertrain, dealers and lenders assume less risk. First, motorists are motivated to make their payments on time in order to avoid having their driving privileges interrupted. Second, the car can be retrieved more easily if payments are not forthcoming. As a result, subprime borrowers can enjoy a lower interest rate when buying a vehicle.
Full Disclosure
It’s important to note that the shut-down devices are not hidden from prospective buyers. In effect, they know the vehicles have been equipped with them. Dealerships will usually disclose the unit’s presence on forms that require the buyer’s signature.
Even though the components were originally meant for the subprime car buyer market, it is likely that more dealers will outfit their vehicles with them over the next few years. In fact, a growing number of credit unions and banks are requesting the device’s installation before providing an auto loan. When the time comes to purchase a new car, the component may not be an option.
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Weighing The Decision To Trade In Your Used Car
by admin on Mar.10, 2009, under Cars
Weighing The Decision To Trade In Your Used Car
Auto parts are designed to last a lot longer than they used to. In the old days, it was common for a 10-year old vehicle to experience constant problems, requiring time, money, and patience. These days, the parts under the hood are more advanced and durable. With regular oil changes and minor maintenance, you might be able to drive 100,000 miles before noticing any problems.
That said, car parts fail over time. Transmissions slip, engines stall, and alternators fail. Spark plugs can go bad and your radiator might overheat with increasing frequency. The older your vehicle gets, the higher likelihood such problems will occur. At some point, you need to decide whether it’s smarter to get rid of your current ride and buy a new one. Below, we’ll explore the pros and cons of purchasing a new vehicle versus repairing your old one.
Advantages To Buying New
The biggest advantage to purchasing a new model is peace of mind. If you’re currently driving a vehicle that has 200,000 miles on it, you know what it’s like to worry about breaking down. A new model eliminates that concern. Another benefit is convenience. Not only will the ride be more comfortable (usually), but frequent trips to the local mechanic will no longer be necessary.
Safety is another factor to consider. New models have more advanced protective features. For example, electronic stability control and lane-change warning systems can have an enormous impact on the safety of you and your passengers.
Reasons To Keep And Repair Your Car
The main reason to keep your current car is that it’s less expensive to do so. Even though it doesn’t seem that way when you’re paying $2,000 for a rebuilt transmission, the long-term savings are significant. Keep in mind that the interest you’ll pay on a 5-year auto loan adds up to several thousands of dollars. Plus, the depreciation on a new car during the first 3 years guarantees a massive loss in value. Lastly, the burden of monthly payments has a lasting effect on your budget.
Looking Down The Road
There will come a time when the only viable option is to get rid of your current vehicle. You’ll find yourself visiting your mechanic every couple of weeks for another repair job. First, the engine; then, a blown head gasket; then, the timing belt. Eventually, it becomes more expensive to repair your jalopy than it would be to buy another car.
While purchasing a new vehicle has obvious advantages, don’t dismiss the idea of buying a used car. There are millions of owners who have carefully maintained their vehicles over time and are willing to accept a reasonable offer. If budget is an issue, buying used can be a fantastic way to find a bargain.
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