First, do your homework before you visit any dealership. Research the makes and models of vehicles you are interested in and find out the base manufacturer s suggested retail price, or the blue book value of the used cars you may be considering. If you have access to the internet, there are many sources of information on new and used car values. Be wary of submitting your personal information to an online car service, because sometimes this will lead to the dealer contacting you before you are ready to negotiate. Second, shop around for financing.
Most car dealers offer financing for their vehicle sales.
However, if you are a member of a credit union, or you have a relationship with a local bank, you may often be able to get better terms and a lower interest rate than whatever the dealer is offering. If you decide to go with the dealer s financing, do not discuss financing terms, especially the monthly payment you may be willing to pay, until after you have agreed on the purchase price of the vehicle. Dealers will often charge you a higher cash price based on the monthly payment you suggest, or will pack the payment with unnecessary extras such as credit life insurance. Third, be prepared to walk away if the dealer refuses to give you the price you want. Do not believe them when they say the price or rate is only good that day.