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Old 01-04-2013, 04:00 PM
 
Location: Groton,CT
39 posts, read 85,803 times
Reputation: 71

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hey all, I am in CT looking to purchase a 2010 Volvo XC60 3.2L as a second car, no trade in. I have looked up NADA values, and unfortunately, most of the dealers prices are less than what is stated. What I want to know is, I am thinking of negotiating the Out The Door cost, instead of the price of vehicle only (cause I know they can make up the "loss" with hidden fees, etc). I fould a cool Excel worksheet that does all the math for you and tells you what each payment is, interest, sales tax, etc.

If the price of the car is stated $26,500 I was going to start with $27,500 OTD. Is that lowballing. How much are dealers willing to take of the asking price?

Thank you for any advice.
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Old 01-04-2013, 04:23 PM
 
16,085 posts, read 22,135,420 times
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I am seriously lost in your speculation. Why not to start with $24K?

## 2010 Volvo Xc60 3.2 ##
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Old 01-04-2013, 04:41 PM
 
Location: Phoenix, AZ
1,070 posts, read 2,710,300 times
Reputation: 1439
Just going off KBB, a 2010 XC60 should be closer to $24,300. But you have to keep in mind what the dealer got it for. If you want to avoid so-called "hidden fees", then don't listen to their sales pitch of "extended warranties" (unless it truly is a good deal, or is a certified used car at an actual Volvo dealer). Hell, dealers will even charge a couple hundred for floor mats! You can usually knock another hundred off the price if you tell them specifically to NOT detail the vehicle before the purchase. That's another one of those hidden costs.

When it comes to flat-out negotiating price, assume the dealer marked the car up by 25% (honestly, a low percent in the dealer world). That means they most likely bought that Volvo for under $20,000. When you go to test drive it, find little things to complain about. The dealer wants to make a sale, and if they can talk you out of a potential "deal breaker" for a small price cut, go for it. Say things like "I like it, but it's not the color I wanted," or "but I really wanted the factory navigation system." When they get the hint that you are shopping around, and might buy a different one elsewhere, most dealers will become more eager to make a sale.

Another important note: know more about the vehicle than the dealer. If the Volvo is for sale as a certified pre-owned, at a Volvo dealer, this would be a lot more difficult. If it's on another car brand's lot, you'll find the salesman doesn't usually know much about the vehicle, asides from what's listed on the sheet. Ask if they would mind taking it to a Volvo dealer for a Pre-Purchase Inspection (PPI). Have the Volvo mechanics look for any little thing that may become an issue in the next 20,000 miles (worn CV boots, slight bearing noise, oil seepage -- anything). Don't look at the car though rose-colored lenses. You're buying an expensive piece of machinery that you expect to receive in working order. If something's not right with it, you shouldn't be paying full price.

If you're financing, don't fall for the dealer's finance rate. Some dealers offer legitimately good financing deals on their new stock, but this is offset by inflated rates of their used stock. When I bought my Mazdaspeed6, the dealer's quoted finance rate (for reference, I have good credit history and an outstanding credit score) was 7%. I told them "not no, but hell no." Through my bank, I got a 3% interest rate on the loan, which'll save me around $1500.

Lastly, be friendly. If you go in waving an excel sheet with numbers in the guy's face, they'll be less willing to negotiate. Use their own mental tricks against them. Picture of a family on their desk? Talk about kids. "Oh, the wife wants the XC60 because we're starting a family, and we just needed a vehicle with more room." Doesn't matter if it's a lie or not -- it's relatable, and makes them more friendly. Sports is another big topic. If you read more into "social hacking" and such, you'll find that most salesman use these kinds of tricks to make them seem like your friend (which, in turn, leads you to trusting them more, and more willing to accept their offer).

Hope this all helps!
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Old 01-04-2013, 07:07 PM
 
Location: Groton,CT
39 posts, read 85,803 times
Reputation: 71
thank you for you thoughts, it was very helpful.
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Old 01-04-2013, 07:16 PM
 
11,460 posts, read 49,252,086 times
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Keep in mind that "the book" doesn't buy a car, you do as a living breathing walking customer.

I'd start my offers at much lower than the asked price, probably not any higher than the loan value of the vehicle.

I'd not make any offer on a vehicle unless and until it has had a thorough pre-buy inspection performed by an independent third party who is familiar with the series of car. I am able to do my own pre-buys, but if you aren't able to do one, then you need to express your interest in the vehicle and arrange for a third party inspection. Plan on spending a couple hundred bucks on a thorough inspection; do not depend or rely upon any representations by the selling dealership. As well, a Carfax report is not worth the paper it's printed on; again, the only thing that counts is the actual vehicle and the results of a pre-buy inspection.

Similarly, service records are nice to have, but what counts ... the only thing that counts ... is the actual vehicle under consideration for purchase. Nor does a dealership prep count for much or the remaining warranty. None of these items will have much value if the car you purchase is defective or has sustained accident damage or abuse.

What you are buying in a pre-owned vehicle is the remaining service life of the vehicle. Make your offer based upon what is there. If you aren't into playing the games with add-ons, then make it clear that your offer is an out the door final price, all inclusive. Stick to whatever your maximum price o-t-d is, and don't fall in love with a given vehicle on a dealer lot, use your rational thinking instead of your emotions. In the world of transportation cars, that's all you're buying, so treat it like a piece of machinery and not a love affair.

You may find that a dealer has a much higher opinion of the value/price than you have. So be it; either keep on looking for what you want at the price you want to pay or pay the dealer's price.
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Old 01-04-2013, 08:25 PM
 
Location: Phoenix, AZ
1,070 posts, read 2,710,300 times
Reputation: 1439
If not financing, one of my friends had a good suggestion: he knew someone who paid cash for all of his vehicles. The guy was an accountant, and knew the percent dealers paid on credit charges (something like 6%). He'd walk in with cash on-hand (6% less than the agreed on sale price), and a credit card. He'd let the dealer decide: cash or card. Granted, it's easier to do this to cheap beaters than $20,000+ slightly used Volvos...But still a great way to knock a bit off the price!
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Old 01-04-2013, 10:15 PM
 
11,460 posts, read 49,252,086 times
Reputation: 15837
Quote:
Originally Posted by cab591 View Post
If not financing, one of my friends had a good suggestion: he knew someone who paid cash for all of his vehicles. The guy was an accountant, and knew the percent dealers paid on credit charges (something like 6%). He'd walk in with cash on-hand (6% less than the agreed on sale price), and a credit card. He'd let the dealer decide: cash or card. Granted, it's easier to do this to cheap beaters than $20,000+ slightly used Volvos...But still a great way to knock a bit off the price!
BS.

If you have an "agreed on sale price", then you have struck a deal at that agreed price, which is what will be written up on the sales contract.

To then offer 6% less is to try to make a new deal, not honor the one that was "agreed on", and 6% reduction in an agreed price is a huge amount of money in today's average sale price marketplace.

The dealer doesn't care if you pay cash or get financing, they get the same net agreed on price of the deal.
If anything, they'd just as soon arrange financing instead of a cash deal because the finance side of the house is another profit center.

Few dealers that I've ever run into will accept a Credit Card payment for an entire car sale sale unless they collect a credit card "convenience fee" to offset their discount rate that is paid for the use of the credit card. At that, the typical CC discount cost to a dealer with a sizable monthly sales volume in CC's is around the area of 1-2%, not anywhere close to 6%. So taking a 6% cash hit on an "agreed on" sale price instead of taking a 2% CC hit simply defies all financial reason .....

I've been paying cash for all my vehicle purchases for the last 30 years. Once I've agreed upon a OTD price and the contract is written up for that, I've agreed to pay and the dealer has agreed to accept that price ... not 6% less after the deal is struck.
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Old 01-05-2013, 12:20 PM
 
16,085 posts, read 22,135,420 times
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None dealer here will even take cash. I tried that tune several times, and they all say - no, thank you. Also, none of them even considers any cash price reduction, as they do not care. Power of a dealer is in ability to survive for extended time with car sitting in his lot. Without dropping price down.
Cash talks only with private party and those dinky little dealerships that are 1 1/2 man operation, but then you likely not wanting to buy what they sell anyway. Even if it "looks" new and has clean title.
If you have cash - buy private party.
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Old 01-05-2013, 08:23 PM
 
Location: WFNJ
1,037 posts, read 2,798,221 times
Reputation: 1067
I found the best way negotiating is if you can find a similar year/mileage model car from another dealership. Mention it during negotiation and tell them you will walk and buy that one if they don't come down. I was lucky to find another car with less mileage, but 1 year older, and forced the dealer to lower their asking significantly (1.5 k off, and their asking was reasonable to begin with compared to other dealerships).
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Old 01-06-2013, 07:38 AM
 
Location: NJ
17,578 posts, read 43,619,398 times
Reputation: 16226
Quote:
Originally Posted by Rcoast911 View Post
I have looked up NADA values, and unfortunately, most of the dealers prices are less than what is stated.
I'm a little baffled by this. You are upset that the dealer price is lower than what you are looking up?
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