Buying a new car doesn’t have to break the bank, especially if you are able to pay cash for the cars you buy. And being able to pay cash for cars has plenty of benefits.
First, paying cash for cars means the buyer saves money in car payments, and sometimes in interest. What may be less well-known is that paying cash for cars also may mean the buyer will get a better deal as well.
But to get that better deal, the individual who wants to pay cash for cars needs to know the best strategies.
First, when buying a new car, the customer may need to avoid telling the salesperson that he is planning to pay in cash. That’s because the salesperson might get a bigger commission if he also arranges financing for that vehicle.
So, negotiate the best deal you can and focus on getting the price you want before there is any discussion of how the deal will be structured. This means the customer needs to push back when the salesmen presses on how the vehicle will be paid for — his job after all, is to find out as much information as he can about you and your prospective purchase.
Then, once you reach an agreed upon price, let the salesman try to offer you a better deal if you finance through him. That positions the buyer to suggest he or she wants the same deal for the cash price.
One of the best ways to be sure of getting that deal is to come into a dealership at the end of the month when the salesman and the business may be trying to make a certain sales quota. And offer the cash price you want, for that day only. It turns around the car sales strategy to favor the buyer instead of the dealer — and it still helps them by moving inventory.
But paying cash for cars also means the buyer has more flexibility too. Gently used cars from individuals can be a great way to find good deals and those sellers almost always want to deal in cash because it’s just plain easier. If you have cash-on-hand, you may be able to strike a better bargain.
Finally, for an out-of-the-box solution that may also net you a great deal: finance your car through the dealership in exchange for a much better price, but only if there is no penalty for paying it off early. Get a better price and deal. Then immediately pay it all off.
Bio: Sean knows how to save money on a car, because he works for a used car dealership. The car dealership he works for sells cars, and also offers money for cars.
I’m aware that buying a car with full payment would save you money since you no longer need to pay for the interest and might get discount. However, i never knew that sales person might also take advantage of this this information to get a bigger commission. It does make sense that we need to negotiate the best deal and focus on getting the price we want before discussing the payment system. Thanks for sharing. I’ll do this the next time I’ll purchase.
Sure paying with cash will always get you a better deal no matter what you are buying but the problem is that you have to actually have cash and most people these days don’t.
Another thing that you should have in mind is actually the cost of paying in cash for such a big deal as buying a car because you could actually invest those money and make much more in the long run than the benefit of a better deal…
Kostas | Opportunities Planet
I remember our family never went for installments and paid the full price up front. This meant going for a smaller, less expensive car of course but we were happier at the fact that it was fully paid for. That peace of mind was worth more than having a more expensive vehicle, I guess.
Where I come from the figures on new car buyers is terrifying. 80% of the people have a car that they “cannot” afford. 40% Of the household income goes for the car(s) in the family. So mondays and tuesdays…car work….
I never took out a loan for any car and hopefully never will. The greatest expense by far.
According to me second hand Car is the best option if you don’t have much money to invest in cars.