The Basics of Dealership Used Car Purchases
When you walk onto the dealerships lot, or showroom, a salesman’s job is to take control of the sale from the moment they meet you.
This article will keep you, not them be in control of the process.
My first bit of advice is, don’t treat your salesperson as a second class citizen.
As in your job, he is trying to make a living. You want this person on your side, as this person will also be the one arguing with their manager on your behalf. The age old way of “Treat your sales rep” like garbage may actually hinder you from your goal; that is getting the best deal you possibly can, and leaving the dealership with your vehicle, feeling good about your purchase.
Let’s get started.
Never be intimidated when buying or servicing a used car from a used car dealer. Do all of your homework on used car values by using just a few resources.
Pricing Resources
Kelly Blue Book: Is one of the best, and most respected resources. Your dealership uses it as their guide, and so should you.
Their website will give you values, reviews, customer feedback reviews, on the virtually every vehicle, and best of all it's free.
Your dealership will tell you, it is a guide, and not meant to give you an “Exact” value. This is true to a degree, That being said, they will whipping out that same blue book, when it comes time to value your car for trade in.
NADA.com: Is the other guide many dealerships will use to determine the value of bother their vehicles, and your trade in. Like Kbb.com,tThis invaluable resource also gives you values, reviews, on your vehicle, and the vehicles you are interested in purchasing.
Edmonds.com: Dealerships do not usually use Edmonds to help them determine the values or their vehicles, or your trade in. They do however give you valuable information on reliability ratings, safety, and recall information, test drive articles, and yes the predicted value of the vehicle. Having these more information will gives you the tools to negotiate the best possible deal on that little jewel you want in your driveway. Edmonds will equip you with tons of information about the vehicle that other sites will not.
Car Survey: This is one of my personal favorites. It gives you reviews of the vehicle you are interested in from the people who actually own them! Word of mouth is the best advertising, and a review from someone who actually owns the vehicle you are interested in is invaluable. I use this site when I am purchasing a car for myself, or a friend. I find getting the opinion of someone who has put 20,000 miles on a vehicle more reliable than from a publication who borrowed the car for a week, than write a "Definitive" article on that vehicle.
Use this resource!
Visit Sales Sites as Pricing Guides
Shop on a couple internet sales sites, such as, Cars.com, Beepbeep.com, or another favorite you may have. Make sure you have done your homework ahead of time about the used car’s values and then consult these notes as you negotiate. You can easily get your dream machine at “Below book price” if you have your proverbial ducks in a row, because, believe me, a dealership sales department will have theirs all lined up.
Now Your At The Dealership:
Quick dose of reality for you the consumer. There is more profit packed into a used car, than a new one.
That trade in they got for $4000.00 from grandma, they are now selling you for $8995.00. that’s a profit of almost $5000.00!!
Now that brand new economy car you’re lusting after? Well depending on the model, they stand to make about $150.00 on that vehicle. That is why they install all those accessories and goodies on that little gem. They need more gross on that car!
There is MUCH more negotiating room on that used car than a new one.
This blog is concentrating on the purchase of a used vehicle, so in the interest of keeping this entry from becoming a novel, I will give the details of a New car purchase in my next blog.
You’ve now met your salesperson. Don’t drive the car until some questions are answered; such as:
A. Is this a “Certified Used Car?
If so, you want to see the mechanic’s pre-certification inspection. Every certified car has to go through an inspection before it can be certified. Ask to see that paperwork to find out what was fixed. They should be happy to give you a copy, and it’s your right to see it. Hold onto for future reference.
B. Is this certified By The Manufacturer?
The only certification that means anything is a “Manufacturer Certified Pre-owned car.
If certification is through the dealership only, that warranty will not be accepted at any other dealership if you have a problem with the car.
If you’re on the road, your on your own. You cannot transfer such a warranty if you move, and if your dealership closes down, or is “Under New Management” that will cause you to be stuck with a very expensive and useless piece of paper.
C. Is a CarFax, or DMV report provided before purchase?
A reputable dealership will have no problem with providing one. Get one. Make sure the report’s vehicle identification number matches the VIN on the used car you’re looking at.
D. Has a “Smog & Safety Report” been done?
Legally, in California, before any car can be sold, it must pass a smog inspection. Ask to see the Smog and Safety report. A “Safety Report” means they performed an inspection, does not necessarily mean they performed any repairs recommended to the vehicle. Find out what was fixed. If nothing, have them fix it ALL before you take the car home!!
If they refuse to provide such information, simply leave, and take your money elsewhere.
E. Who was the vehicle purchased from?
Was this car a trade in from the “Little old Lady From Pasadena,” or something that was towed into their Service Department as a factory buy back, also known as a “Lemon.”
If it was a trade-in that is a good thing as Most dealerships only tend to keep the cream of the trade in crop, and wholesale the garbage.
Look Out For:
Auction cars: They are not normally sold at a new car Dealership unless it is a lease turn in. Most cars that were leased are well maintained, until the last year of the lease.
I’ve had many a service customer tell me not to repair items like brakes, belts, hoses, and timing belts because, “It’s leased, and I’m turning it in, so why spend the money?”
Previous Rentals: I’ll explain this by asking you a question. How do you treat a rental car? Like your own? I don't.
A Word on Independent Used Car Dealers:
Here you find all the dealership rejects, which is not necessarily a bad thing. They are typically cars with higher mileage, or the cars our Service Department rejected and were than “Wholesaled.” Independent dealerships will typically purchase their stock from a wholesaler, or much worse, from an auction.
If you purchase from an independent dealership, always have a trusted technician check it out for you……without exception!! If it was an auction car, just say no, unless you REALLY know what you're doing.
Auction vehicles are typically vehicles that failed a safety inspection, are “Lemon Law” buybacks, or have had severe body damage. There are a myriad of other potential problems on auction cars, which is typically why a dealership will not sell them.
(See my upcoming blog on how to purchase from an auction!)
F. How long of a test drive can I take?
You don’t ask how long you can test drive a car, you tell the salesman how long your test drive will be.
Don’t go for the “Predetermined route.” You’re about to drop big bucks on this car, Drive It First!!!
Turn the radio off! Take it up and down hills, checking for easy acceleration up hills, and smoking, or backfiring down the hills.
Around corners, check for a smooth turn feel, (Power steering rack) excessive body lean, and suspension groans. Groans mean shock absorbers, or worse.
Find a parking lot, and make low speed right and left circles with the steering wheel fully locked. Listen for suspension noise, like knocking, popping, or squeaks. Knocking, or popping noises are usually CV joints, idler arms, or again….worse.
Lastly, and very important, drive the car on the freeway, and not just for ¼ of a mile! Each vehicle’s driving characteristics will change dramatically at 65 MPH. It is also when the shakes, and rattles, and all kind of interesting noises arise. Don’t’ find them on you way home, After you’ve purchased the car!
G. How long has this beauty been on your lot?
Seems an innocuous question for conversation sake, but you can save yourself big bucks with this one.
Many dealerships have a 60 day window to sell that “little beauty,” as it is money, just sitting on their lot. If your dreamboat has been for sale there for over a month, they want to get rid of it Right Now, before they have to wholesale it, and lose their shirts. You are in a Much better position to bargain for a car that has been there over 30 days, than on a “Fresh trade.”
This is where having been nice to your salesperson comes in handy. He’s more apt to cough up such information if he or she has a feels comfortable with you.
Ask all of these questions BEFORE you “take her out for a spin!” Don’t waste your valuable time on a car you know doesn’t meet your pre-determined “No” list.
Move on to what you really like, and than drive.
H. What is your cash price for this used car?
A dealership would rather you finance a new car, as the banks like their business. They also have a better chance of selling you that “Cocoa Nut Butter” fragrance at $1500.00 that you so desperately don’t need.
Cash is good on used cars, as they are harder to finance. If you’ve got cold hard cash, they’re likely to come down much more to get rid of the car that’s sitting on their lot collecting dust. About 5% off of the price is about right, but of course, go for 8-10%. When their done laughing at you, you might settle on 7%. You’ve just saved another 2%. Two percent off of $15000.00 is quite a very nice savings!
I. What is the dealership’s return policy? (Used Car Only)
In California, as in many states, there is NO cooling off period on New Car purchases. Once you roll that little $26000.00 baby off of their lot, it’s now a used car, worth wholesale bluebook….maybe $19,500.00.
Used cars are different. Some dealerships have a week, two weeks, even up to a one month return policy on a Used Car. If you drive it home, and hate it, you can bring it back. Get the details from A MANAGER In Writing!!!
Again, THIS APPLIES TO USED CARS ONLY!
J. Do you take trade-ins?
Negotiate the value of your trade in independently of your deal, than have it attached to your purchase. In spite of what they tell you, one has nothing to do with the other. They will offer you less for your trade on a more desirable used car than the one they have been trying to move. Decide on your trade value, than pick the car.
K. What equipment comes as part of the purchase?
This is not a negotiating point.
As part of the deal, “Tell” them they are going to throw in those nice floor mats, and the missing cargo cover, (if your car is a hatchback) or it’s no deal.
They will NOT lose a deal over a pair of mats, or missing cargo cover (if your hatchback comes equipped with one.)
Mats at the dealership will run you a cool $120.00 and up. And that “little cargo cover thingy” your salesperson said he would get you a deal on; Oh it cost’s about $350.00 and up depending on the model, and that’s if they have it in stock.
There, you now have two less things to worry about, and saved yourself $470.00 just for telling them what you want.
If you are going to come back to have extra repairs, (a squeak, replace a broken console cover, ect.) or have tire, light, or any other accessories installed by the Service Department, this is Extremely important!
Get everything IN WRITING.
Your service department will need all that the sales department promised you on a piece of paper, with a managers signature on it!
They will not accept “Well my salesman told me you’d give it to me,” as payment to their department. Only a Sales Manager, or the General Manager has the authority to approve Any additional repairs, or accessories which are to be performed in Service Department.
Save yourself the panic attack! No matter the promises made to you in the sales department, Make Sure you have it in writing, or that $1200.00 AC system you were promised, simply will not be installed.
Only your Sales Manager has the authority to approve any accessory, or fulfill any Promise.
With the proper papers, and signature, your Service Experience will go off without a hitch.
NOW A WORD ON ONE OF THE MOST MISLEADING THING A SALES DEPARTMENT MAY TELL YOU.
“And this little baby is covered by a “BUMPER TO BUMPER warranty.”
I’ve been in the automotive field since 1978. I began my journey as a Porter, than a Service Advisor. After some years, I made the leap to Service Manager, and ultimately became a District Service Manager. I am responsible for the proper operation profitability, and customer satisfaction of several Dealership Service Departments in the Southern California area.
I gave you my brief resume so that you might believe me when I tell you There is NO such thing as a “Bumper to Bumper Warranty!”
It is a sales ploy that I personally detest.
There are days I must make a 200 mile drive only to inform some poor client whose brake pads are making noise on a used car they just purchased, that they are in no way covered by any warranty known to planet Earth. Brake pads “Wearable items” and are simply not covered.
There may be some exceptions on a New car, which I will cover later, but for used cars, there is nothing your Service Department can do.
It is than I invariably hear, “But my salesman told me I had a bumper to bumper warranty.” I really feel for folks when they tell me that, but there is nothing that can be done on the service end.
So what do you do? Go directly to the sales managers office, and let that person know that you are...displeased that the car you purchased one week, or one month ago has not brakes left. They can approve a repair, maybe.
This is an example of why it so important to tell the sales department that you want to see the safety report, before you purchase the car.
A WORD ABOUT WARRANTIES:
L. Things Not Covered, or Partially Covered Under a New Car Warranty
Adjustments:
Adjustments include, but are not limited to: Alignments, adjustments to door latches, head lights, trunk latches, hood, trunk, or door body alignments.
Wearable Items: Brake Pads, Clutches, Windshield Wipers, Belts, Hoses, Light Bulbs.
Batteries: Batteries are covered, but by a pro-rated warranty. See your Warranty booklet for the details on your make and model, as battery warranties vary.
Tires: Are covered by the tire manufacturer, and is NOT part of your new or used car warranty! For instance; if you purchase a Honda with Goodyear tires on them, and you have a problem with one or all of those tires, you must take said tires to the Goodyear dealer, not your car dealership.
Your tire warranty booklet is in the same pouch as your owner’s manual. It explains everything you need to know about your tire coverage’s.
You’re simply out of luck on: Stains, Windshield cracks or chips, spills into your automatic trans gear selector, or any other accessory. If you spill something into a component, or put a piece of bread into your cd player, it is not a "Factory Defect, but regarded as neglect, and not warrantable…..Ever.
I Can Help You Get Around Some Of These Things
Each item will differ.
Some manufacturers will cover brake pads for 3000-7000 miles, and some don’t. Clutches are extremely expensive, and if you burn through yours in 6000 miles, it’s it's not covered. Clutches and brake pads are regarded as "Wearable Items," as some folks can drive on brakes for 60,000 miles, while others who live on hills, or do allot of stop and go driving will go through them in 7,500 miles. However, that being said, one of the purposes of my blog is to assist in how to possibly get some such items covered, that ordinarily would not be.
There are some ways around brake pads & clutches, but very few. I will tell you what to say, and more importantly, what not say on my next blog on “What you need to know about purchasing a new car” blog, coming very soon.
Windshields are normally not covered. That is because stress fractures are extremely rare.
99 times out of 100, it is cracked or pitted because a pebble hit it. The crack was caused by an "outside influence," (like hitting something with your bumper), and is therefore an insurance issue, not a warranted repair.
Your dealership can determine if it is a stress fracture, or a pebble by finding the beginning of the crack, and using a sharpened pencil. They will than follow the crack to the source. If there is a divot at the source, the crack was caused by a pebble. Try it at home. It could save you a needless trip to the dealership.
Used Car Warranties
If it is Certified Used, By The Factory, go over that warranty with a fine tooth comb!!!
If you purchase an extended warranty, (Which I advise, but ONLY the Manufacturers warranties, no aftermarket), you must read Everything before signing.
You’ve Taken the Leap!
You’ve decided on your car, gone to the finance office, and signed all of your papers! It’s now your car!
Not quite.
Even after you’ve signed those papers, it is still not your car. If after you’ve signed, you get that lump in your throat, and wonder, what did I just do, you can still change your mind!
As they wash and gas up your new pride and joy, take a little break, take a walk, or get some lunch, and discuss it. I you feel really good about the deal, take it home. If you still feel really sick about the whole thing, tell them no.
Better that, than drive home with a car you really don’t want, cause, you, not them will be making the payments for the next 3-4 years!
My Next Blog
On my next blog, I will cover a New Car Purchase, which in many ways is an entirely different animal.
I will tell you how to potentially get those worn brake pads, (under 3500 miles) covered. And that clutch? On a case by case basis, I will tell you how you might get that covered as well, saving you about $1000.00 dollars.
I will also cover explain how your new car, battery, and tire warranties work.
I will give you advice on whether or not to purchase a New Car Extended Warranty, and which ones to avoid at all cost!
Do you purchase that paint and interior protection package, an alarm, bigger tires, those really cool rims, or will they void my warranty?
There are some aftermarket accessories that will make your warranty null and void!
I will tell how to make sure that never happens.
It’s not hard to do! I will give you one tip now. Those "Scheduled Maintenance Requirements" on your vehicle are really "Requirements," and not suggestions.
If you do not maintain your vehicle, your engine, or transmission will not be covered if that failure is related to a sludge buildup related to a lack of maintenance. That is a $5000.00-$25000.00 mistake, depending on what vehicle you own.
Your service intervals are mandatory to keep your warranty active.
So Why Am I Telling You This?
I want to save you from having problems at your dealership. I’m not in this for money.
I’m doing this because in all of my years in this business, I have seen far too many clients get hosed, and in all honesty, sometimes hose themselves, wasting their valuable time, and allot of money simply by doing or saying the wrong thing.
I want to help you save money in your service department. For example, did you know you could save yourself some big bucks by simply asking if there is a coupon for the repair, or service your vehicle is there that day for? They usually do!
This leads me to my next piece of advice.
Our Tempers & Our Service Departments
Do you remember my advice on keeping your Salesperson on your side? Well, that is even more beneficial when it comes to your Service Adviser. He or she is a person who can help save you hundreds of dollars on a service, or repair, which can add up to thousands over the lifetime of your car.
They can assist you with warranty issues, give you that 10% discount on certain items, or install your wiper blades, do a quick adjustment, or bulb, (if it is easy to get to) for you for free.
You however can NOT accomplish this by cursing at them.
If you want to curse something, curse the vehicle. That keeps it on a non personal level, and does not demean or embarrass the person who is trying to write your service order. A person can understand you cursing your vehicle out of frustration, as we've all had a vehicle fail us. However, it is harder to understand why a client is cursing YOU on a personal level.
Let the steam escape on your way to the Service Department, so when you get there, you are ready to deal with your Service Adviser in a calmer state.
I know from experience that no one takes more abuse than a Service Advisor.
I was never moved to go out of my way to offer a coupon to someone who just called my mother names because there were no doughnuts in the waiting room.
My blog does not tell you how to “Take advantage” of a facility, as that is not necessary, nor honorable.
It is not necessary because each automotive manufacturer has a system in place for client retention, and satisfaction. I want to help you to make the most of that system, and make it work for you.
A car company, like your company wants you back for future business.
I much prefer giving you good news about the warranty on your smoking vehicle, not breaking bad news.
This blog is my attempt to help you make sure you get the most out of your car, sales & service experiences.
I look forward helping you in this goal.
You may e mail me at any time with your questions, and feedback.
Oh, I can't let you know my name, or who I work for, as I know they would not appreciate some of the information I share with you on this blog.
See you at my next blog
Happy Motoring
