The final few months of the year offer many great opportunities to save on the purchase price of a car. From late November to New Year’s Eve, dealerships are extra eager for your business. Why? They want to reach or surpass their sales goals and decrease their current inventory as much as possible before the new calendar year begins. This means you, as the buyer, have the most leverage to negotiate a great price. Here are some things to keep in mind.
Take Advantage of Previous Model Year Discounts
Carmakers typically introduce new model year vehicles in August and September; giving them four or five months to move out older inventory. But if any of those previous model year cars are still lingering on the lot come the last week of December, you could score a serious deal.
Take Your Time
If you really want to ensure the best possible deal, it’s wise to take your time. Research the car price online so you know the MSRP and what the typical sale price is for the same make, model, and accessories. Then learn about the holiday incentives being offered. Be sure to read the fine print, as sometimes the offer is extremely specific regarding the model, options, or financing, and this may not align with the car you’re hoping to buy. Next, head to the dealership (or better yet, a few dealers) about two weeks before the end of the year so you can test drive and make a connection with the sales people.
At this point, you should leave and wait. About two days before the end of the year, it’s time to negotiate. The sales people will be so eager to make a deal that they’ll likely be more inclined to work with you.
Do the Math and Get Pre-Approved
Many yearend sales incentives revolve around a super low interest rate on dealer financing. But again, it’s important to pay attention to the fine print.
It’s always best to get pre-approved for an auto loan before you start shopping. You’ll have a clearer sense of the rate you qualify for, which will then help you do the math on the purchase price and loan term that gives you a desirable monthly payment.
Even if your lender is offering a slightly higher rate than the dealer’s incentive, it may make better financial sense. Either way, having a pre-approval in-hand when you visit the lot means you can focus on negotiating the price of the car instead of being roped into a financing conversation. This will give you leverage to make the most economical choice for you.