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How To Buy A New Car And Not Get Screwed. 5 Car Buying Tips From A Former Car Salesman.

If you’re shopping for a new or used car I want to tell you how I go about the process. I sold new and used cars for about four years and while I’m certainly no expert on the matter, I think I know how to buy or lease a car better than the average Joe off the street. Maybe this post will help you save a few bucks next time you’re in the market for a car; it’s worked well for me and my family.

How To Buy A New Car

How To Buy A New Car

For the past decade I’ve driven my cars into the ground. Two of my last three cars were driven, quite literally, until the engines blew up and they had to be towed away.The average age of my last three cars at the time I bought them has been 13.5 years old. Buying older cars and driving them into the ground has allowed us to get ahead financially.

In fact, driving older POS vehicles for the past decade allowed us to buy a brand new car this week. Buying a new car is downright blasphemous in the financial independence, early retirement community. For many, buying a new car a cardinal financial sin.

This post isn’t to try and convince you otherwise nor to justify my decision to buy a new car. You shouldn’t feel the need to justify your financial decisions to anyone but yourself. Personal finance is just that – personal.

Just because many “experts” tell us all to not buy new cars doesn’t mean we shouldn’t ever, under any circumstances do so. Those experts might be right most of the time, but every situation is unique and there isn’t a one size fits all, single path to financial independence.

Understand your own situation. Consider the many variables that are unique to you.  Think it through, but in the end, do what’s right for you.


I learned these 5 new car buying tips firsthand as a new and used car salesman. Following these tips will teach anyone how to buy a new car and not get screwed:

1. Don’t Rush It

The best way to get a bad deal in almost any situation, especially when making big ticket purchases, is to put yourself into a position where you HAVE to buy something quickly (think last minute purchases for birthdays, anniversaries, Christmas, weddings, etc).  Next time you start shopping for a car, take your time, do your homework online, read reviews, keep narrowing down your search until you’re looking for a very specific vehicle.  When you know exactly what you want (and what you don’t want), and what a good deal looks like you’ll be able to stay focused and keep emotions out of the transaction when the time comes to make the purchase.

2. Get Pre-Approved Financing

Dealerships will often “hold points” on your auto loan when you finance a vehicle through them, which ends up costing you a lot of money over the life of your loan. Here’s how it works: when a dealership sends your credit application to a bank for approval, the bank will tell the dealership ‘We’ll offer this buyer a loan at 4% interest.’ The dealer comes back to you with the good news: “We got you approved at 5%!

In this example the dealer holds that one percentage point for themselves as profit, which is very common and totally legal. You can avoid this by pre-arranging your financing with a locked in interest rate before you ever step foot on a car lot.  If the dealership can get you a better interest rate than the one you walked in with then great, take their better deal, but don’t let first interest rate you see come from the dealership.

3. Paying Cash? Keep That Quiet

Some people think that you’ll get a better deal by being a cash buyer.  That’s usually anything but true if you’re buying from a dealership.  Dealers make their money from several different sources* (trade-in, new car, financing (i.e. holding points), service packages, extended warranties, accessories, etc).

When you eliminate that potential source of income from the dealership then they’ll attempt to make up for it elsewhere, usually in the form of a higher price on the car you’re buying.  If you are paying cash, there’s no need to start your negotiation off by saying “Give me your best cash price” – that’s a great way to make sure you pay a higher price.  Instead, keep that information to yourself until the price of the car has been agreed upon.

4. Focus On One Deal At A Time

If you’ve got a trade-in then you’re actually buying and selling two cars: yours and theirs.  When this happens it’s best to deal with one transaction at a time.  Either focus in on the price of the new car first, or lock in the value of your trade-in first. Never look at ‘blended numbers’ where the details from both transactions are smooshed into one.  That gets confusing and it’s easy to get bamboozled.

First, agree on the price of the new car.  Only then should you let your salesman know that you’ve also got a trade-in. By doing this, you’ll see the true price of the new car you’re buying and the true price of what you’re getting for your trade.  When you combine the two transactions, it all becomes a shell game when numbers are shifted from new car to trade-in, then back again until you’re looking at something which is hard to understand.

Don’t bother, just do one deal at a time.  In our case we agreed on a number we liked for our trade, then we focused on the price of the new car.  That’s backwards from how I like to handle things, but that’s OK.  Whatever order you do this in, just make sure you deal with one transaction at time.

5. Stick To Your Budget Or Walk Away

After you’ve narrowed your search, test driven several different cars and finally found the exact one you want, it’s time to start talking numbers. I prefer negotiating face to face, but many like to do their negotiating over the Internet. Whatever works best for you is great, but I prefer in-person transactions.

Part of doing your homework (from step one above) is knowing what a good deal looks like. You need to know how exactly much you’re willing to pay. That’s why at the beginning of every negotiation I make it clear to my salesman that I have a very specific budget that I’m working with, and that I won’t “get close” or “almost get there.” I need to come in under our budget or there’s no deal.

Depending on the personality types of you and your salesman, it can feel uncomfortable to hold firm and not budge. That’s not you being a jerk – you’re just protecting your wallet. And from the salesman’s perspective it actually makes doing the deal pretty simple.  No B.S. or games – just a single number to deal with.  When you’re willing to walk away, you have all the leverage.  The dealership has the car you want, you have the money the dealership wants.  If you’re willing to walk away, you have the upper hand.

Learn #HowToBuyANewCar and not get screwed! 5 #CarBuyingTips from a former salesman. Shopping for a new or #usedcar? These 5 tips will help you get the best price on your new car, top dollar for your #tradein and the best #carfinancing terms.

That’s How To Buy A New Car

So there you have it, a few tips from a former salesman that will help you get a better deal next time you buy a car.  Let me know in the comments section if you’ve got any tips of your own. Or maybe you have a car buying horror story to share?

* For the record, I have zero problems with the dealership making as much money as they can. A car is worth whatever someone will pay. If the dealer can get you to pay more, that’s your problem, not theirs (assuming there isn’t any lying or shady business going on).

Chime in!

Got any car buying tips of your own to share?  How about a horror story?  Leave a comment and let us know.

By Ty Roberts

Ty Roberts is the founder of Camp FIRE Finance, and a husband and father of four living in the Seattle area. He's a fan of the 4% rule, 80s movies and music, dad jokes and cast iron cooking.

48 replies on “How To Buy A New Car And Not Get Screwed. 5 Car Buying Tips From A Former Car Salesman.”

Interesting advice for cash buyers. Now you have me reconsidering my approach when paying cash for a vehicle just under a year ago. According to my research, I got a very good deal, but maybe I just got lucky.

Sometimes it’s better to be lucky that good! 🙂 Paying cash doesn’t mean you can’t get the lowest price, it just makes it harder to do so because the dealer will be less likely to give their profit margin away if they can’t make up for it elsewhere.

I’d bet you got a great deal. Doing proper research will almost always help you get a great deal. It’s those poor suckers that buy on impulse that end up overpaying and find themselves underwater

Good tips Ty!

I’m in the market for a new(er) car and was planning on buying with straight cash. Any tips on keeping that a secret? I would think financing discussions would come up during the course of the negotiations, so I may just have to stick to my guns and agree to only discuss price first.

I definitely think tip #1 is the most important. I have a friend who recently had her car give out, so she was in a rush to buy. So much of a rush that she was worried about negotiating a measly $600 off the price of a $17,000 car! Poor girl must have gotten eaten alive during the negotiations.

Thanks Wizard! Good salesman are *fantastic* are getting information out of you, like whether or not you have a trade-in, if you’re paying in cash, etc. Nothing against them, it’s a salesman’s job to get that info then use it to his/her advantage.

When a salesman starts asking questions I’m open and upfront but usually just say something like “I’m open to all options whether that’s paying cash, or financing this through the dealership or my credit union, but right now I’m focused on finding a car that I love then getting to a price that we can both live with.” When they ask if you’re trading in a car, say “I’m not sure? I’ve considered keeping it, selling it on my own, or possibly trading it in, but right now I’m just focused on finding a car that I love then getting to a price that we can both live with.”

Just be vague and don’t take any options off the table. You may very well intend to pay cash, but many dealerships offer 0% financing for 60+ months when you finance with them. I’d jump on that in a heartbeat! Take their free money and leave mine invested? Yes please! Also, you get a sales tax credit on your trade-in — so when a dealer offers you less than you want, don’t forget to factor that credit back into the deal.

I have been lucky enough to have purchased all my vehicles through craigslist at really good prices. To date, I have not had any problems with any of them so I hope I can continue my streak on my next one. I save thousands of dollars off the price by buying used privately.

Thanks for stopping by, Alexander and congrats on scoring some killer deals. Buying privately is a completely different ballgame than buying new, and you’re far more likely to get a really great deal going private. Two thoughts:

1. Buyer beware — make sure any privately purchased vehicle is inspected by a mechanic you trust. Good dealers usually have their inventory tuned up and inspected. If something major is broken on the car, a dealer will either fix or disclose that. Not all private buyers will do that, so be careful.

2. My advice about being a cash buyer goes out the window when buying privately. Waving cash in front of a guy is a beautiful way to get a great price, whereas with a dealer, that’s not such a benefit.

Hey Jenna – I hope this helps you two save thousands of dollars! 🙂 one more tip: EVERYTHING is negotiable (price of car, trade in value, interest rates, car/truck accessories, maintenance packages, price of the warranty, “dealer doc fees”- anything with a price can be negotiated at the dealership)

Seems like it comes down to being patient and avoiding the shell game — that is, negotiating on the price of the car alone rather than allowing the dealer to shift the cost around between financing, trade-in value, etc. Good tips!

Great advice and I totally agree with you that it is circumstantial whether to buy a new car or not. We usually buy used but the last two car we purchased were crazy good deals. We have a long time friend that works at a dealership. Our truck was not only last models Year(with 2 miles on the odometer) so we got a discount, on top of a manufacturer discount and one other. Turned out to be 10k less than a private sale.

The last purchase I made was for my daughter. She was moving 1100 miles away and we wanted her to have a safe and reliable car. We got another great deal from our friend, plus zero percent interest(I co-signed). Totally worth the car payment for peace of mind.

I need to take you with me if we ever buy new again. I did it once, and they told me they’d give me a discount if I financed it, then refused to finance because my credit was too good and they wouldn’t make much from the loan. So confusing!
(sidenote, this was only after being refused service at age 22 in a dealership or two. I couldn’t get anyone to acknowledge my presence- I’m guessing because they thought I was too young to be able to afford a car. Grr.)

That’s crazy! I saw some downright shady things happen with financing a vehicle, but never saw or heard of that. And anyone that would ignore a potential buyer wasn’t a very good salesman. The first thing we were told was never to make an assumption.

It makes sense to not rush into things when choosing a used car. I would imagine that you would need to take the time to find a good car for you and your family. My sister is looking for a new used car so she’ll have to find one after doing enough research.

Hey Gloria – having plenty of time and information when shopping for a car is always a good position for a buyer to be in. But it’s like they say, it’s not what you know, it’s who you know. Can’t you just hook your sister up with the friends and family discount from the dealership you work for? That wouldn’t suck for her!

awesome post! Definitely some great advice and tips on buying a car. Buying used is always a great option, since you can save thousands. Thanks for sharing!

Hey Selene – for sure! Shopping used is a very good option, but it can be tricky to get a great deal. When shopping for new vehicles a buyer can be looking at two different cars with the EXACT same specs on different car lots. In that case, it’s easy for the buyer to get the sales managers to compete against each other on price. When shopping used that’s harder to do, but as a used car salesman/manger you already know this 😉 To get the best deal, buyers need to make sure they look up the NADA and Kelly Blue Book value of the vehicles they’re looking at so that they have a baseline number to work with. Buyers should also make sure that a mechanic they trust goes over the used car and gives it a thumbs-up before any paperwork gets signed.

A great read. Personally I like to Private Lease a second hand car. Not as expensive as driving a new one and no initial costs. Above everything; no maintenance costs.

I prefer introduce my trade-in only after we’ve locked the price of the new car. However, when I bought my last car, as pointed out in this blog post, I actually started with my trade-in, then moved onto the new car. So it can be done either way, but I think it’s easier to get the best deal by negotiating on the new car first, then your trade.

try not to rapport with the sales people, when you into a car dealer, dont be there to make friends, get in , scout and buy then get out, theres nothing worse than being sweet talked into buying a car that you dont like !

Hey Sam, good point. You’re there to do business, not to make friends. You can be polite w/out overdoing it and at the end of the day, everyone likes the deal to move fast (the buyer and the seller).

I loved that you said that the best way to get a bad deal in almost any situation is to put yourself into a position where you have to buy something quickly. I totally agree that if you are going to buy a car, you should take your time, do your homework online, read reviews, keep narrowing down your search until you’re looking for a very specific vehicle. My husband likes making purchases in a hurry, and he wants to buy a new car soon. I will make sure not to let him do that in his way this time!

I agree. The strongest negotiation position is being able to walk away. Having the knowledge beforehand also makes the deal much easier on both sides. Thanks for sharing!

Great tips, Ty!! Of course, I botched quite a few being I needed to buy a car yesterday but in all it turned out just fine as I more or less knew what I wanted. I am now the proud owner of a 2016 Honda Fit. Hopefully she lasts to make it to the High Mileage Club!!

If a gullible customer enters the showroom, then the car dealer can easily spot him. The dealer can cheat that customer easily without his consent. Thus, before entering the showroom, as a consumer, you need to conclude what kind of car you want to snap-up, you need to establish your budget, you need to check the reviews using internet, you need to contact the best lender for getting the best financing deal, by which the automotive dealer will never get a chance to screw you. Also, you should take a test drive without making any commitments to the dealer. Thanks- Robert, for sharing a healthy car buying guide 🙂

Thanks, these tips are really helpful. Unfortunately, I am now in a position where I need to buy a car quickly and I’m not a real petrolhead myself. I will be looking for cars this weekend and will bring a friend who is more knowledgeable in this field. Trying not to get scammed is where I set the bar right now.

It’s good to know this about getting a car. My wife and I want to buy a used one soon, but we really don’t want to mess it up! I’m not great at sticking to a budget, but luckily, my wife is. She’ll help us follow your advice and protect our wallets.

When you buy a car, I think these tips are really helpful. I agree with you. Many people face this hesitating problem when they want to buy a car. Really helpful post.

These are good tips. However, for most I’d still recommend buying used. It’s true that personal finance is personal, but most people who buy new really can’t afford it and are suckered into it by the dealers because they “make it work.” If you can afford to pay in cash or have a ton of money then okay, but for most it’s not a good idea.

I love how you mentioned to do research on different types of cars before buying, as it will help you find the one that is best for you. My friend’s current car is very old, so he’s been wanting to get a new car. These tips will definitely help him has a good buying experience, so thank you for the great advice!

I loved when you mentioned who you should take the time to avoid getting your emotions involved when getting a car. It is important to remember that doing some research can help you get the best type of car for your needs. As I see it, taking the time to do some research can help you find the best type of vehicle that will suit your needs right.

I always thought that if you were paying with cash, then you would naturally get a lower offer for a car. After reading your article, I really appreciated learning that you should keep that information to yourself, since a lot of dealers will give you a higher price if you say you are paying with cash. The next time I am buying a used car, I won’t say how I am paying for my car until we are at the end of the transaction.

Thank you for sharing such an informative and on point post. Planning to buy a new car by next year, I just really to save up more. I was thinking of a used car but well maintained. But I’m not yet for sure about it. Got a year to think and save up. Anyways, great read.

Thanks for your very detailed article. I’m about to purchase a pre-owned car. Financial thing is sorted now. And, you have mentioned about Patience. I totally agree. One shouldn’t rush while buying a car.

It sure was helpful when you said that you should consider spending time on reading reviews about the specific vehicle that you’re looking to buy to ensure a good deal. My husband is interested in buying a new Chevy Silverado car. He said that he wanted to make sure that he will be able to buy it without going over his budget. It’s also important for him to make sure that it has features that he’s looking for in a car, so I’ll share your blog with him.

I really like that you suggest doing your homework before you buy a car. My husband and I are wanting to get a new car and want to make sure we get the right one for us. I’ll have to do some research and find the best new car dealership for us.

I have a post on a system for new car purchasing from early on that describes the system I use.

Essentially contact a bunch of dealers via email on the car you want. Do the negotiation over email.

This gives three advantages:

It allows you to on the spot compare multiple dealer prices.
Causes the dealer to have to compete with other dealerships.
Removes all the high pressure sales tactics dealer can use.


I agree that it would be important to focus on sticking to your budget. I wouldn’t want to get a car that I couldn’t afford, just because it looks cool or something. I’ll make sure to stick to my budget if I choose to buy a new car so I could make sure I have money for things like rent, and food.

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