A big part of being wealthy is holding onto your wealth. This doesn’t mean you have to drive a junk car around to save money, but you can certainly get the car you want and pay no more than what you feel you have to pay for it. Especially if monthly payments are involved.
Think about it for a second. If you go in to a dealership without a plan, you are the salesperson’s wet dream. There is nothing they like more than a clean slate. They are very good at finding out things about your finances and just how much car they can get you into without you even realizing it if you aren’t careful. And don’t think for a second that just because the salesperson seems nice enough that they wouldn’t oversell you a car for their own benefit. You can’t blame them, it’s how they make their living, after all.
The biggest mistake people make is going in without any up front research. The internet has made it possible to go in armed and dangerous, but this alone is not enough. You need a few other weapons in your arsenal before you take on the sales force. Yes, I said sales force. Nowadays, you don’t only deal with one salesperson. They take the entire team out on you and you’d better be prepared and ready for battle. Now let’s get down to today’s tip:
1) NEVER finance through the dealership!!! You might as well write CHUMP on your forehead. Always get pre-approval from a credit union / bank even if you have to open an account and slap $5 in it to qualify to get a loan. Ask them to work up how much you’d need to borrow to get to the payment YOU want to pay and tell them to only approve you for that much.
I cannot stress enough the part about getting the payment YOU want to pay. Only YOU know what YOU can afford so don’t go over that amount. Any salesperson would make you go over what you know you can afford without blinking an eye so take them out of the equation altogether. No they won’t like it, but they will still sell you a car regardless. They will even try to say that they can beat what you’ve got pre-approved, but don’t let them persuade you because they will pull something and you are always safer sticking with your bank/credit union. I do recommend credit unions if you have access to one. They seem to have a way of saving you additional money on loans. I don’t know how, but they do and they have never steered me wrong.
By going in knowing what you are pre-approved for, this also helps you figure out exactly how much car you can afford. In the coming days we’ll cover more of this but this first tip is one of the most important tools in your arsenal that you can have so do not skip it no matter what you do!
More tips are coming. See you tomorrow for the next one!
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