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When negotiating at the car dealership do you mention the trade-in up front?
Posted by: 3d
Date: May 05, 2016 11:32AM
When negotiating at the car dealership do you mention the trade-in up front? Or work out a cash price price first, then right before agreeing, you mention the trade-in?

I'm guessing that if I mention the trade-in at the end they'll just offer me less on the trade-in to offset any profit losses in the initial round of negotiating when the salesperson was thinking it was an all cash deal.
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Re: When negotiating at the car dealership do you mention the trade-in up front?
Posted by: space-time
Date: May 05, 2016 11:37AM
just sell it yourself on CL, that's what I plan to do with my old car.
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Re: When negotiating at the car dealership do you mention the trade-in up front?
Posted by: 3d
Date: May 05, 2016 11:41AM
Quote
space-time
just sell it yourself on CL, that's what I plan to do with my old car.
I rather just trade it in at the dealer.
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Re: When negotiating at the car dealership do you mention the trade-in up front?
Posted by: jardster
Date: May 05, 2016 11:41AM
The last few times I've gone and gotten a quote from Carmax (if they are in your area). Each dealership I've purchased the car from agrees to meet or beat the Carmax quote.



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Re: When negotiating at the car dealership do you mention the trade-in up front?
Posted by: testcase
Date: May 05, 2016 11:42AM
NO. Make the best deal you can, THEN talk about trading in old car.


A salesperson is likely to ask if you have a vehicle to trade in. Tell him you're doing a private sale. Once you have what you believe to be the best deal you can get, you can ask what they'd give you if you were to trade your old car with them.
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Re: When negotiating at the car dealership do you mention the trade-in up front?
Posted by: 3d
Date: May 05, 2016 11:48AM
Quote
testcase
NO. Make the best deal you can, THEN talk about trading in old car.


A salesperson is likely to ask if you have a vehicle to trade in. Tell him you're doing a private sale. Once you have what you believe to be the best deal you can get, you can ask what they'd give you if you were to trade your old car with them.

Asking about a trade-in is usually in the first 2-3 sentences out of the mouth of car salespeople I've dealt with. I've told them I was planning on keeping it as a second car. But what if the stars are all in alignment, the salesperson is on the verge of tears, and I negotiate an amazing cash price. THEN I mention the trade-in. Won't they just offer me less on the value of the trade-in to offset all that negotiating I just did?
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Re: When negotiating at the car dealership do you mention the trade-in up front?
Posted by: cbelt3
Date: May 05, 2016 11:49AM
Per testcase. But also know what your old car is worth IF YOU SELL IT yourself. Factor in the annoyance factor. Then judge their trade-in.

Keep in mind that you can sell a running car on CL for at least $1,000. I'm talking rust, scratches, dings, dirt, etc. Cash For Clunkers killed off a lot of the $500 heaps.
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Re: When negotiating at the car dealership do you mention the trade-in up front?
Posted by: 3d
Date: May 05, 2016 11:56AM
Quote
cbelt3
Per testcase. But also know what your old car is worth IF YOU SELL IT yourself. Factor in the annoyance factor. Then judge their trade-in.

Keep in mind that you can sell a running car on CL for at least $1,000. I'm talking rust, scratches, dings, dirt, etc. Cash For Clunkers killed off a lot of the $500 heaps.

The Kelley Blue Book value is $10-11k on my 2009 trade-in depending on how critical they are in grading condition. Selling the car myself is really out of the question. I just don't have the patience for it.

I've been told elsewhere (and in this thread) that I don't mention the trade-in until at the end. But I'm wondering why this is the case. A cash offer on the buyer's part is much stronger than cash + trade-in. Mentioning the trade-in at the end would put me (the buyer) in a disadvantageous position right at the end of the negotiating. Is this not the case?
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Re: When negotiating at the car dealership do you mention the trade-in up front?
Posted by: Markintosh
Date: May 05, 2016 12:14PM
One thing I have found more recently is that trade in versus sell yourself argument is strongly affected by CarFax.

If any, and I mean any, accidents are reported in a CarFax report, the dealership will use that to severely undermine KBB trade-in value, Right or wrong, buyers depend so much on looking at a CarFax report, the dealers want them squeaky clean.

If there's any rough spots on the CarFax report, you'll be far better off selling it yourself.

We purchased two different used cars over the last 6 years that had clean CarFax reports when we bought them, only to find out that collision damage reports were added after we purchased. When we went to trade in those vehicles later it was a big problem. Dealer offers consistently came in at 50% of trade in value on KBB.



“Live your life, love your life, don’t regret…live, learn and move forward positively.” – CR Johnson
Loving life in Lake Tahoe, CA
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Re: When negotiating at the car dealership do you mention the trade-in up front?
Posted by: 3d
Date: May 05, 2016 12:23PM
Quote
Markintosh
We purchased two different used cars over the last 6 years that had clean CarFax reports when we bought them, only to find out that collision damage reports were added after we purchased. When we went to trade in those vehicles later it was a big problem. Dealer offers consistently came in at 50% of trade in value on KBB.

YIKES! That sucks. Which is why I'm wondering why people are saying to mention the trade-in at the end of negotiations after I've invested time and aggravation in negotiating up to that point. Personally, I want to know up-front if I will get skrood on the trade-in price by the dealer. I (the buyer) want to know this upfront at the very beginning when I sit down. So I can get right up and walk out the door on the spot without wasting a minute.
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Re: When negotiating at the car dealership do you mention the trade-in up front?
Posted by: N-OS X-tasy!
Date: May 05, 2016 12:53PM
Quote
testcase
NO. Make the best deal you can, THEN talk about trading in old car.


A salesperson is likely to ask if you have a vehicle to trade in. Tell him you're doing a private sale. Once you have what you believe to be the best deal you can get, you can ask what they'd give you if you were to trade your old car with them.

This.



It is what it is.
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Re: When negotiating at the car dealership do you mention the trade-in up front?
Posted by: rz
Date: May 05, 2016 01:25PM
We were upfront about it when I bought a new vehicle last year. But we also factored the cost of what we could have sold it for into our final price. The trade-in in question was 17 years old with 180K miles on it, and was definitely showing signs of its age. KBB private party value was about $1,200-$1,500. They flat out told us they were going to send it to auction, which was a no-brainer. So we factored $1,500 as the trade-in value. Funny thing is, in the final paperwork, they showed that they gave us $2,200 for it. We didn't care, since we got it out the door for the price we wanted.
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Re: When negotiating at the car dealership do you mention the trade-in up front?
Posted by: Buzz
Date: May 05, 2016 01:52PM
Years ago, c. 1999, traded in the Pontiac Transport minivan which looked be worth +/- $12K, but it had some annoying issues that the dealer was aware of. Was originally gonna sell it back to the Pontiac dealer for $10.5K, but then they balked at the 11th+ hour and went down to $9.2K, so the Toyota dealer where we had already cut a killer deal on a new Sienna, matched the trade after the fact. Well, the Pontiac dealer that we got the minivan from was also a Cadillac and GMC dealer, so they had sold me a set of 16" Cadillac Northstar wheels for $400 to spruce it up over the OEM 15" Pontiac van wheels when we first bought it. So, fast forward to after the Toyota dealer put $800 of fix-ups into the old van, they listed it for $13.5K on the lot, plus another $2K for the "custom" wheels, and it sold within a couple of days, w/ the wheels, for $15K. Moral; it's like Vegas, the dealer always wins.
:-)
==
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Re: When negotiating at the car dealership do you mention the trade-in up front?
Posted by: MarkD
Date: May 05, 2016 05:38PM
Theoretically, helpful to deal with the retail sale first and then deal with the used car. Otherwise, the trade in just becomes another shell under which to hide the pea. If they don't want the car, they will lowball ya. ("Manager says all I can offer for trade in is $500") As someone mentioned the paperwork may not reflect the numbers you agreed on.

I had a friend years who played the "country" dealer versus the "city" dealer to match the retail price and the trade in price. The "country" dealer told him the truth that if he gave the big trade in, he had to charge more for the retail price.

The key is that you have to figure out the real value of the used car and the retail car. The used side is where the variables can be found. As my Dad says, the dealer makes money on the deal or they don't make the deal. Your job is to cut the margin as close as possible. Separating out parts of the deal hopefully makes that easier.
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Re: When negotiating at the car dealership do you mention the trade-in up front?
Posted by: Michael
Date: May 05, 2016 06:49PM
I tell them up front. I have the invoice price on the new vehicle and all of the various used prices (it's remarkable how much they can vary). I also go to Carmax and get a price on the used if it's convenient. I then know how much I'm willing to pay for the new minus trade-in. I don't care how they structure it--as long as the difference is where I want to be. Last year we bought 2 new vehicles and traded in the old ones. At the Honda place it was first negotiate on the new and then the old. They offered me $1000 less than Carmax for the old CRV and I countered for $500 more than Carmax offered and they took it--that was strange because I was truthful about what Carmax offered. At the Toyota place we did the same except I didn't have a Carmax price because my truck trade-in was 11 years old. They low-balled me on the old and I just worked my way back to where I wanted to be. They started at $2600 for a 2004 Ranger with 120,000 miles and I started at $4500. We settled on $4100 eventually-that was at the high end of the various online values. Once we made a deal on the difference the manager wanted to change exactly how the numbers worked on the old vs. new and that was fine with me. The out-the-door price was the same. I imagine it has something to do with sales reports that go back to Toyota, maybe?
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Re: When negotiating at the car dealership do you mention the trade-in up front?
Posted by: michaelb
Date: May 05, 2016 07:15PM
They negotiate deals on cars for a living. Any of us are amateurs. So in negotiation theory it is usually easier to negotiate sequentially, and not multivariate, all things at once. Yes, you will get "less" for your trade in if you agreed on a price first; but your overall price/cost may be better, and also the structure of the deal will be more transparent. Do you have cash for a downpayment and are you also seeking financing? Dealer financing is usually a bad deal, unless they are offering a good deal.

But I would take it one step further. Whatever you negotiate that first day, don't take it. Always walk out. At that point, they are losing money on you no matter what, so they may not be that motivated after that point. But you also definitely want to leverage other options, including carfax and private sales. Then come back to them with a price that works for you (less your agreed upon trade in value).
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Re: When negotiating at the car dealership do you mention the trade-in up front?
Posted by: michaelb
Date: May 05, 2016 07:27PM
A follow up point after reading Michael's story above mine post. I have only worked on a handful of auto fraud cases, but that did include reviewing the financing paperwork and purchase agreement and dealer documents, to try to understand how they structured the deal and what the consumer did or did not understand.

Manipulating the trade in may matter most on dealer obtained financing. If you are bringing cash or your own financing, a negotiate a price net of your trade in that works for you and that they agree to, that isn't too complicated and most can understand what happened.

When you throw in financing is where it gets complicated, because then the dealership has a motivation to inflate the value of the trade in (and the down payment, which they may try to inflate in various), to increase the overall price, and the overall amount financed. And the consumer can end up financing, i.e.paying interest on, a higher net price for longer, as a result of getting sucked in to that transaction. Never negotiate a "monthly payment" always know the actual purchase price of the car up front.
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Re: When negotiating at the car dealership do you mention the trade-in up front?
Posted by: wurm
Date: May 05, 2016 07:45PM
I must give credit to one dealer my brother dealt with years ago, who basically told him "I can write it up however you want. I can give you a great deal on your trade-in and a lesser discount on the price of the new car, or I can give you a great discount on the new car, but a lesser trade-in on yours. We have to make a certain amount."

When it all comes down to it, it really is one or the other. Often, it works out better with the better trade-in, since you're usually only paying sales tax on the net cost after trade.



Edited 1 time(s). Last edit at 05/05/2016 07:46PM by wurm.
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Re: When negotiating at the car dealership do you mention the trade-in up front?
Posted by: max
Date: May 06, 2016 04:14AM
Quote
michaelb
And the consumer can end up financing, i.e.paying interest on, a higher net price for longer, as a result of getting sucked in to that transaction. Never negotiate a "monthly payment" always know the actual purchase price of the car up front.

This....
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Re: When negotiating at the car dealership do you mention the trade-in up front?
Posted by: Mr645
Date: May 06, 2016 07:30AM
I typically bring the trade up front, but always keep the two transactions separate.

My last car we leased, a 2015 Lexus, I had a Subaru to trade. We agreed on the deal for the Lexus but were about $2k away on the value I expected on the Subaru so I did the Lexus deal, passed on selling them my Subaru. After delivery of the Lexus they offered to split the difference, come up $1000 but I still wanted another $1k so I ended up selling the Subaru privately. I got $500 more then I wanted from the dealer and it sold quickly because I still sold it for $1500 below typical retail
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Re: When negotiating at the car dealership do you mention the trade-in up front?
Posted by: RAMd®d
Date: May 06, 2016 01:59PM
Otherwise, the trade in just becomes another shell under which to hide the pea.

Geeeze, I can't think of a more apt description of dealing with a car salesman.


They negotiate deals on cars for a living. Any of us are amateurs.

Talk about a theorem.


When it all comes down to it, it really is one or the other.

The bottom line.

I really hate buying a car.




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