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So you’ve learned how to negotiate a new car and think that guarantees you a good deal.  Well think again!  Did you know a majority of a car dealer’s profit comes from add-ons in the Finance Office?

Dealerships want you to think the hard part is over and that it’s time to let your guard down.  But as you’re getting ready to sign for your new car, the Finance Manager will smoothly convince you that you need expensive add-ons and accessories.

What are Dealer Added Options?

A dealer added option is any accessory that a car dealer installs on a vehicle after they receive it from the manufacturer.   Examples include items such as floor mats, cargo covers, roof racks, VIN etching, and pin striping.   The prices of these items are not listed on the car’s MSRP sticker, but instead a dealer will typically add a second “addendum” window sticker.

Dealers add these items because they have high profit margins and most people don’t try to negotiate them!

Average Car Dealer Profit for Add-on’s (Infographic)

The image below shows how much the Finance Department really makes off everything they sell you.  Note: these high numbers aren’t even the total price you pay, they only represent dealer profit!

But not to worry, you don’t really need most of these items.  Here’s a breakdown of what these items really cost the dealer and what you can do to save yourself money.  When in doubt, google a specific option and see if it’s recommended or available outside the dealership at a lower price.

Common Dealer Add-ons & Accessories

Negotiating Dealer Add-Ons

Many of the add-ons you will be offered are unnecessary or can be purchased outside the dealership at a significantly lower price.  There are two main tips for negotiating add-ons:

1. You probably don’t need it, so don’t buy it.
   If an item is not factory installed as part of an options package the dealer may be able to remove it from the deal.  Consider whether you really need it, or if can you buy it elsewhere.  In the majority of cases, if the item is optional then say NO.
2. Negotiate the whole car deal, not individual items
   Follow the advice on my website and get car prices from several dealers.  Make sure each dealer gives you a total price that includes all options and add-ons.  You should be able to find similarly equipped vehicles and then you can ask dealers to give you their best overall price (including add-ons) to win your business.

Should you buy during a specific month, day, or even time of day? There are a couple key considerations to consider when determining when to buy your car.  Look at the infographic below to see how timing can affect car prices. And if you really want to know how and when you can get the best deal, read my Ultimate New Car Buying Guide.

  Click the infographic below to enlarge.

Embed this image on your site:
<a href=”https://www.findthebestcarprice.com/best-time-to-buy-a-car/”><img src=”https://www.findthebestcarprice.com/images/best-time-to-buy-a-car.jpg” alt=”Best time to buy a car” title=”Best time to buy a car”/></a><br/>Source: <a href=”https://www.findthebestcarprice.com/best-time-to-buy-a-car/”>Best Time to Buy a Car</a><br/>

Best Time of Year to Buy a Car

You can find the best prices on seasonal vehicles off-season.  Convertibles and sports cars can be cheaper in the fall and early winter because of less demand. The weather also plays an impact.  SUV’s might be discounted in the summer when gas prices are up and people aren’t as concerned about finding four wheel drive cars to navigate wintery roads.

If you’re looking for a home on the road, the best time to buy an RV in colder climates is when the snowbirds have headed south for the Winter.  Demand drops off and sellers know they are going to have to go through the hassle of winterizing and storing the RV for the off season.   Conversely, in parts of the South, the best time to buy an RV is in late Spring after buyers migrate back north and there is less local demand.

The fall months are also good for sales at the end of a model year.  Different manufacturers end model years at different times, but many change years in September or October.  Dealers want to get rid of old models to make room for new ones. And you can get especially good deals if the body style is changing.  Just be careful to weigh the discount on an end of model-year car.  As soon as you enter a new year, that car’s resale value will take a hit because it’s labeled as a whole year older.

Best Month to Buy a Car

December is a great month to buy a car because dealerships are desperate to lure shoppers on the lot while most people are preparing for the holidays and spending all their extra cash on gifts.  It’s also the best time of year to buy a car because dealerships are trying to hit their annual sales quotas and related bonuses.  Dealerships have both month-end and year-end targets, so December means big discounts.  And if you don’t want to stay home on the holidays, Christmas Eve and New Year’s Eve are typically two of the best days of the year to find deals.

Best Day to Buy a Car

Even if you forget everything else, remember this statement:  The best time to buy a car is the last couple days of the month.  Manufacturers set monthly targets for car dealerships.  If car salesmen and dealerships meet their monthly sales goals they can earn bonuses.  So if you time your car purchase towards the end of the month you could end up buying from a car salesman who is close to hitting his quota and earning a bonus payment.  This bonus may be much bigger than the loss he takes on a single sale and as a result he may be willing to provide a bigger discount to you in order to earn that bonus.

And interestingly enough, the second best time to buy a car is the first couple days of the month.  Because the end of the month trick is widely known, salesmen are usually pretty busy with buyers that have waited.  As a result, the first couple days of the month mean fewer buyers and idle salesmen may be willing to deal.  Salesmen may also want to get a jump on their monthly sales quotas so they’re not under as much pressure at the end of the month.

Best Time to Buy a Car

Don’t go out of your way for this one, but some dealerships offer salesmen a small bonus ($100 or so) for selling the first car of the day on a Saturday or holiday to encourage sales. So if you are one of the first buyers of the day you may notice a small benefit.

What’s the Best Way to Buy a Car?

That’s easy, don’t go to the dealership at all!  Get car prices from multiple local dealers and ask them to compete with each other over email.  I explain how in my Ultimate New Car Buying Guide.

What if You Need a Car Now?

As much as you might like to time your car purchase to get the best deal, it’s not always possible.  Sometimes an accident or unexpected repair may make waiting difficult.  In these cases, you can still get car prices online and make car dealers compete.  And check out Edmunds car incentives and rebates to see which manufacturers are currently running promotions.

European Delivery Programs

Here’s a final added tidbit.  If you are considering buying a high-end luxury car, why not take a trip to Europe?  While timing a luxury car purchase may not net you savings on the car itself, you can save on your vacation spending.  Manufacturers like Audi, BMW, Mercedes, Porsche, and Volvo all offer vacation packages that allow you to pick up your car in Europe and tour the country side.   As for the best time of year, Spring is a great time to visit Europe while the weather is comfortable but the high-priced summer tourist season as not begun yet.

Bad credit doesn’t mean you’re a bad person. But it’s easy to feel like one when you get turned down for a loan. That salesman suddenly stops being your best buddy, and you get shooed out the door like a drunk uncle at a wedding. You still need a car to get back and forth to work though. I mean, how else are you going to fix your broken credit?

Although it may seem hopeless, you still have options!

Alright, to buy a decent ride with poor credit, you’ve got to see just how ‘poor’ it really is. Most banks and finance companies won’t touch anyone with a beacon score that’s below 640. But if you’re within a reasonable distance of that magic 640 number, you can still get a car loan. The interest will just be a little higher.

If you’re thinking that 600 would be an improvement, you’re not alone. Over 17% of Americans have credit scores below 620. And 17% is a lot of people.

Pull your credit file from the credit bureaus, and pay their little fee to see your beacon score. Then, scrape together at least $1,500 – $2,000. The more money you can come up with, the better off you’ll be.

Not so bad credit

Assuming that your credit number isn’t below 580, many dealers will be able to finance you through something called ‘special finance’. Designed for hard working people who’ve gotten a little behind, these finance companies focus more on your payment history than your score. If you’re current on most of your obligations, then you’ll probably be able to drive off in a newer vehicle.

A special finance car loan has a higher interest rate than your typical car loan, usually in the neighborhood of a credit card. And you’ll need a substantial downpayment (here’s where that $1,500-$2,000 comes in). But if you need the dependability of a newer vehicle, special finance is a good option.

Oh my gosh-credit

If your credit score is like -640, you’re going to have to settle for an older car and a higher interest rate. This warrants it’s own post so check out these options for really ugly credit.

Cash

If you want to avoid car payments altogether, then pick up the local penny paper, and spend some time on CraigsList. You can easily find a good running vehicle for $1,500-$3,000. Just be sure to have a good mechanic standing by to check it out for you.

Cash is always the best way to pay for a car, even if it is older. If you go this route, you won’t have a car payment, and you won’t have to carry that expensive full-coverage insurance, which is a requirement for most financed cars.