Shopping around for a new or new-to-you used car can be exciting. But before you step on the lot, be mindful of a few sales tactics and how to ensure you stay in control. Doing some homework ahead of time can help you buy in confidence.
Also known as the 'four square' method, this sales tactic combines multiple, unrelated factors into a single transaction. The sales manager writes the price of the car, the down payment, trade-in value and the desired monthly payment into four boxes. If you want a certain trade-in price or a set monthly payment, other numbers may increase to compensate.
Inflated Interest Rates
Some car dealerships may advertise a certain interest rate, then make a last-minute change to financing.
How to prepare: Secure a car loan through a bank or other outside party and come to the dealership with pre-approval in hand. Know your credit score beforehand so you're confident about what you can afford, and triple-check all numbers in your paperwork.
Some car buyers have driven a car off the lot without securing financing. This means that a few weeks later, the car dealership could call to say the loan application was rejected and that they need new paperwork–with a higher interest rate or down payment.
How to prepare: Never sign a deal or drive away in your new car if you don't see your interest rate written down.
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