Negotiate a car effectively

Negotiate a car effectively

Don't settle for a price that may not be fair

Last updated: May 2014

The first rule is, don’t fall in love with a car. Cars are commodities, not people. The used-car market is huge, and in every category, there is more than one brand to choose from, and more than one model that should fit your needs. Even if you have your heart set on one specific model, be assured that it’s not the only one for sale.

In general, negotiating the price of a used car is less harrowing than when buying a new car. There are fewer opportunities for dealers to add on extra-cost items and other charges. And a private seller is unlikely to have the experience and resources to play hardball negotiation games.

Still, never negotiate under pressure. Salespeople may assure you they won’t pressure you but then do it in a subtle way. A common sales tactic is to claim someone else is interested in the same car. Even if it’s true, don’t feel you have to make a deal immed­iately; there are always other cars out there.

If you’re buying at a dealership, negotiate one thing at a time. First settle on the price for the vehicle you’re buying, then discuss your trade-in or financing terms separately. Salespeople often try to get you to focus on your monthly payment. Using it as the focus, the salesperson will lump the whole process together, which gives him or her too much leeway to give you a "good deal" in one area while making up for it in another. This is the first step down a slippery slope of being manip­ulated with numbers and over­paying for your vehicle.

Based on your pricing homework, you should have a good idea of how much you’re willing to pay. Begin by making an offer that is realistic but 15 to 25 percent lower than this figure. Name your offer and wait until the person you’re nego­tiating with responds. Be courteous, but hold to your original figure after receiving any counteroffer.

If you must move your offer up, do it in small increments. If the gap between the two sides is, say, $1,000 or less, move your bid $100 at a time. State clearly when you have reached your last offer, and stick to it. Don’t be afraid to say your offer is fair, final, and good for 24 hours only. If the seller won’t budge, be pre­pared to walk away rather than pay more than you know is a fair price.

Used car buying guide

Learn more about choosing a used car, avoiding a lemon, buying and selling a used car, pricing and financing, and more in our used car buying guide.

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