When you’re looking to save some money when things are tight, opting for purchasing a pre-owned vehicle can make a lot of sense. However, negotiating the price of a used car during an economic downturn can be a bit different than during more prosperous times. Learning how to negotiate a car price is a valuable life skill that everyone should know. Here are some tips from Autozen to help you navigate the process effectively.
Research the Market
Start by doing some browsing through online listings and dealership car lots. That’s a good way to get a feel for what’s available, and how much you can expect to spend on various makes and models. Utilize online tools and resources to determine the fair market value of the specific make and model you are interested in. Websites like Carfax and Kelly Blue Book can provide valuable pricing information for the Canadian market.
It’s also worthwhile comparing asking prices for similar used cars between dealerships and private sellers. On the one hand, a private seller may sell for a lower price than a dealership because there’s no middleman and no markup. However, along with a higher price from a dealer, you will probably get at least a limited warranty in case something goes wrong after the purchase. Factor in this when deciding whether to buy from a dealer rather than privately.
Either way, in an economic downturn, sellers may be more motivated to sell, giving you more negotiation leverage. Bear this in mind as you browse.
Set a Budget
Once you know what used cars are going for, determine the maximum amount you're willing to spend before negotiations begin. If you are going to need a loan to finance your purchase, talk to various lenders to see how much credit you can get, and what the interest rates will be.
Stick to your budget to avoid overspending. After all, you’re looking for a used car because you don’t want to over-extend yourself with the purchase of a new vehicle.
Start Your Search
Once you’ve determined what make and model you’d prefer, and know how much you have to spend, it’s time to start looking seriously for a used car.
You don’t have to spend long days going around to various used car lots to get started; there are plenty of online platforms to help you narrow your focus. Car dealerships usually have a website which shows their inventory, so that you know if it’s worth making the trip out. As well, online platforms such as AutoTrader, Kijiji, and Facebook Marketplace are commonly used by private sellers to advertise their vehicles for sale.
You can simply input your preferred make and model as search terms, and see what’s available in your price range. Start by reaching out to sellers who have a car that looks promising, and don’t be afraid to ask questions to narrow down your list of potential purchases. Save yourself travel time by only choosing the most likely used cars to actually go to see.
Checking it Out
Of course, at some point you will have to get away from the computer and check out the cars in person. Make an appointment to meet with the dealer or private seller, and be prepared with any further questions you may have. Especially with a private seller, insist on seeing proof that they own the vehicle in question, and ask if they have a current safety inspection certificate or any additional documentation such as a Carfax report.
While you’re there, conduct a detailed inspection and take the car for a test drive. After that, if you’re seriously interested, consider hiring a mechanic you trust to ensure that the car is in good condition. Remember, any issues that you find can be used as negotiation points.
If the seller does not have a Carfax report to share with you, you can get one yourself using the Vehicle Identification Number. If you’re buying from a private seller, it’s a good idea to include the optional lien report so that you know if there is a loan on the car.
Once you’ve seen the car and taken it for a test drive, it’s time to start negotiating. Don’t rush the process; rather than making a deal right on the spot, go back home and make a reasoned decision before beginning the bargaining. Here are some tips on how to effectively negotiate a car price.
It’s a good idea to use email or online platforms to negotiate initially. This can give you time to consider your responses and present a stronger negotiating position. Especially if you’re uncomfortable in a high-pressure situation, this can help you successfully land the deal you want.
Point Out Flaws and Repairs
When communicating with the seller, use any flaws, cosmetic issues, or necessary repairs as negotiation leverage. If the car needs new tires or has scratches, mention these to justify a lower price. If you have real concerns about its condition, insist that the seller get a current safety certificate before proceeding. Remember, you may want a good price on a used car, but the seller also wants to make a sale. You have the power in this situation, and don’t be afraid to use it.
Don’t give up if the seller turns down your first offer. It can often take several weeks for a car to sell privately, and that means extra expenses such as insurance in the meantime for the seller. A deal they’re not willing to agree to one week might seem much more appealing after some time has passed with no other offers.
It’s also worth mentioning to the seller that in the current economic downturn, fewer people are buying and they’re less likely to get the price they want.
Explore No-Haggle Dealerships
If you really aren’t comfortable with the process of negotiating, see if you can find a dealership with a no-haggle pricing policy. It can provide transparency and may be a good option if you prefer a straightforward buying process.
Be Prepared to Walk Away
Especially if you’re working with a private seller, you may find that they have unrealistic expectations of what their used car is worth. People like this are more likely to refuse to budge on their asking price. If your research tells you that the price is too high, and the seller shows no signs of coming down in price, give up and walk away. There are always other cars and sellers.
Learning how to negotiate a car price can help get you into a good used car at a price that you can afford. Remember, negotiation is a two-way street, and both parties should ideally come away feeling satisfied. Approach negotiations with respect and a willingness to find a mutually beneficial agreement, and you will be able to find yourself a used car for a good price.