Question... does the dealership make money from the simple act of opening a loan? So even if we pay it off within that first month, is the dealership still making some sort of $$ from starting the paperwork?
I'm 50 yrs old and owned a small dealership for years. Of course if your a dealer you'll go to auctions and buy cars. I've been out of the car business for some time and what this man is saying is gold. I do exactly what he said at the end of this video and have been for many years. I also set my alerts on CL and always look for high-end 1 owner cars. I almost felt as if he was giving away trade secrets but then I remembered, I don't have a dealership and am not selling cars for a living. You should thank the creator and then thank this man who made this video. Valuable info you wouldn't know without his generous effort to teach you. Peace.
When you are car shopping, are u paying Kelly blue book value or are the sellers selling to you for less than book value? If Kelly book says a Hyundai Tiburon 2003 GT great shape gets $5000 but it's got 156k miles, I believe for each year, 12,000 miles is the average car miles - so 2003 average miles in 2022 is going to be about 144,000 miles on it. If the car has 156k miles, you subtract $1000 for each 12,000 of miles off the price. So, I would offer the person $4000 instead of $5000 because of the milage. Obviously, I'm going to look at other factors as well but is this an approximate method for figuring out a fair price on a car? Kelly's blue book for a starting point.
In 2010 I purchased a new Honda Pilot. They had a special deal on financing where I saved like $2000 that they couldn’t give me for paying cash. So I took the loan, got the discount and then paid off the loan.
Superb video, and you explained exactly what I did to get the best deal on a new car from a dealership. 1. Leave all options open (new/used, finance/pay cash, trade-in/no trade-in. 2. Be non-committal until the very end. 3. Negotiate the PRICE OF THE CAR ONLY until you agree on a price; then finance it for one or two months, and then pay it all off after 2 months. This is absolutely the best way to get a great deal on the car (finance manager thinks you are financing the car and gives you a break on the price, then you pay it off in 2 months so you don’t have to pay exorbitant interest rates). Another thing: never start negotiating the price on first visit to the dealership. Most of my car purchases happened over a period of 4 or so months so they knew I was serious; and I usually bought at the end of the month so the dealership was incentivized to sell in order to reduce carrying costs of the vehicle over another month. Yet another thing: always have a holdover comment to use as leverage (something you honestly don’t like about the vehicle in question - but don’t absolutely have to have). You can use this for leverage when negotiating price. For me, it was style of wheels, or a particular feature they didn’t offer which other dealerships (or vehicles) did - could be something as simple as rear heated seating, ventilated front seats, or wireless charging option. All these things (plus trying not to show too much enthusiasm) will help you to financially negotiate the best deal. Again, thank you, Marko, for a superb video!
What if the dealer does not negotiate on price? I prefer dealers who don't fiddle fart around and dicker on the damn price. The sticker price IS the price, as far as I'm concerned.
Ok so story time- My cousin, who is blonde, played up the “I’m a dumb blonde girl and do not know anything about cars” trope when she went to the dealership to get a Lexus. She did so many stupid things like open the trunk and said “Oh my god! Where’s the engine?” Or she pretend to not be able to open the door “bouncing” her Ta Ta’s the whole time in front of the salesman. When it came time to buy the car she played up the dumb blonde thing again and they offered to finance in house with this ridiculous rate. Like 20% or something in exchange they took thousands off the price for her to make it look like she got a deal. The next day she came back in her business suit and paid off the loan. THEY WERE PISSED. She is one of my favorite cousins.
Car loans are simple interest not compound interest, which means they add the interest of the total term of the loan to the principle of the loan right there from day one, divide the total amount by the number of payments and that is the amount of your monthly payment, regardless of when you pay it off you end up paying the same amount: the total principle + total interest.
@@had2043 unless you think a customer is an idiot and try to skirt around. I don’t know how logistically it happened but it did. I’m not sure what your comment is suppose to prove other then that Lexus did not do their due diligence.
@Brad Olson that is what I thought unless there a stipulation where there a penalty. Bc I posted this question before n never read an answer. Go through the whole salesperson spill get the lowest n just pay it off the next month.
The most powerful 4 words when negotiating the sale price and the fees, "That's not good enough". Don't be afraid to walk away if the offer isn't good enough. Great video - thanks!
I bought a mini van for my wife using the above and went back about one year later to buy a truck for my company, they recognized me and threw me out of the dealership, the best day ever.
Bought a car last year at a dealer. I asked about financing, worked on what bottom-dollar would be etc. After we settled on the price, I just switched it up and wrote a check. The finance guy got pretty forgetful and uncomfortable but I sealed the deal my way (I planned on paying in full before we even started the process, I just didn't let them know that until it was all done).
We did the exact same thing when we bought our new Highlander last year. We also negotiated the bottom line price via financing, and then wrote the check. They weren’t thrilled, but we had the price we’d wanted in writing.
I was wondering how this works. I can see doing it Marko's way but I guess doing it your way I suppose the dealer could get upset but why would I care about that. What I don't know, could the dealer cancel the deal at this point? That's my only fear and it may be unfounded and I may be over thinking it 🙂. I'm paying for my next car in full, either financing and paying off in 30 days or by whipping out the check book.
I’m not sure how it would be at every dealer, of course…but from the moment the sales guy said hello, until everything had been worked through with the finance manager, I honestly told them that we weren’t sure if we were financing or paying cash. And honestly, the bottom lines either way weren’t terribly far apart.
@@NunoGabriel the dealer or you can cancel the deal at any time if you haven't already taken possession of the vehicle. Either way, you should get your money back. Any steps beyond that with you in possession of the vehicle turns the tables. Beyond that, I'm not sure what we're talking about.
Depending on what rate you get your financing, it may sometimes make sense to go with the financing for instance 0 percent (if your lucky) to say 1.9 or 2.9%, say rather than pull from your 401k or if your really savvy like me and index fund, they net between 5-10% for the amount you have in there. Your money better serves you in the index/401k, then if you were to take it out and pay cash to avoid the 2.9% (average financing for good credit).
I took out a totally unnecessary loan for a car in January. Low interest rate and didn't put a single dollar down cause my credit is perfect. Didn't need a loan but figured it might be smarter to keep the extra cash on hand for other investments... Fast forward to June... More than doubled all that cash on the stock market and my loan interest rate is now less than most inflation projections because of covid stimulus money printing.
I always make sure the ODO price is locked in at the salesperson’s desk, and I ask for a breakdown(tax, delivery, document etc.). If it changes(+), I’ll walk. Also, you can negotiate interest rates. Get a print out of a low rate from your credit union/bank and ask them to match it.
@@tommak6516 This pertains to the US. I worked in car sales during college. It doesn’t matter who has to sign off, but yes typically it has to be a sales Mgr. My point is if they can’t present the accurate final cost at the salesperson’s desk, no need to go any further. By final cost, I’m referring to total price if you’re paying cash. Interest rates/payments are typically handled in the business office but have seen exceptions there too.
the first step to gaining wealth is figuring-out your goals either on your own or with heIp of a financiaI pIanner and foIIowing through with InteIIigent pIans; you wiII gain financiaI growth in no time and enjoy the decision of managing your finance
I just bought a new transit & did the exact same thing with the B/S fees. They took them right off the price of the vehicle, as you said. It was an easy discount. They wanted to sell the van, & I really wanted the van, but told them, if they didn't remove it, I'd walk. The buyer holds the cards.
@@stan4800 Then I don't buy. That's why I'm driving my 2011 Traverse, bought for cash in 2013. When I do buy, it will be for cash again. If they want my money, they'll deal. If they don't, fine.
I am a Dave Ramsey follower, so when I saw the title I decided to watch the video, but I knew I was gonna have to leave a comment about how debt=risk blah, blah, blah. I stand corrected, this is very solid advice, I still believe that when I have the money to buy a car I will do it with a private party.
Amazing advice, I paid cash for a used BMW at a dealership and fell into the same traps you outlined in this video. It is old school thinking to believe that telling them you are paying cash will help you negotiate!
Love this man! So many people walk in to a dealership and just bend over and still think they got a "good deal". Thanks for the ammo I'll definitely be using this.
Well presented. Best advice I ever got and has proved true regarding dealership salesmen is " don't hesitate to walk"....what you're saying along with that mindset is the way to go.
Great information on here. Excellent job. Another thing to add for those smart people watching this before going in to dealership. Don’t purchase a car whose total price is more than half of what you make a yeAr. Regardless if your paying cash. Your essentially buying a depreciation asset. Put your money somewhere it will grow. Or at least not depreciate as badly as cars do.
Been in my fair share of dealers, bought plenty of cars in my time, this guy *definitely* knows what he's talking about. Don't get lured by the shiny new metal, you're just financing depreciation.
@Richard Favreau That's _just_ what they want you to think. You're not finessing anyone at a dealer. You cannot neutralize depreciation. Those are one time discounts. Depreciation is forever.
@Richard Favreau Ah yes, manipulation of statements, I heard Fox News is hiring. There's nothing inherently wrong with financing until it is that the value to cost ratio is outweighed, which is done so often with most car buyers. You can pretend that life is a commerical and everyone has great credit with opportunity for rebates, but that's not 80% of America. If you want be a shill for big banks and car manufacturers, that's fine. There's a reason they got enough money to wrap around the world, and it's definitely not because people are outsmarting them. I'm just here to inform.
Great information! I am retired now and cannot afford to spend a lot of money for a car that I will seldom drive. The car I own now is 19 years old. I bought it from Enterprise car rental. The car I had before this one I bought from Hertz rental. It lasted over 13 years. I have never owned anew car.
Thats how I do it. Bring price comparisons from atleast 3 different places. Tell them if they can beat the lowest prices they get sale. Once they agree then tell them you will pay cash. If they try to recoup by pushing doc fees, warranties....walk.
@@carlhammill5774 wait so.. how are you saving money by hiding that you're paying cash? Isn't the price of the car, the price of the car. so whether you're paying cash or financing, they're gonna charge you the price of the car plus bs fees. I watched the video, but don't really understand where the savings are coming from aside from avoiding GAP and accessories.
@@JulesTradesThe savings come from how quickly you pay off the loan. Find out if the loan has a penalty fee for paying it off early. If it doesn't, get the loan in exchange for getting a lower price on the car. Then pay the loan off early so that you won't owe interest on the amount. In that way, you still pay cash; just not to the dealer.
@@JulesTrades When you pay cash there is no interest fees. When you finance there is interest, and dealerships make money off that interest. When you tell them you are financing they are more flexible with the price of the car as they know they will get the money back on interest payments on your finance. When you tell them you're paying cash they will not budge on the price as you are not making them any payments after you take the car. So by telling them you are financing you can negotiate the car price lower but then still pay cash in the end; this is the ultimate endgoal of a successful deal done in a dealership.
I agree with what you said. Another great place to buy a used car is check with your local credit union for repo cars. My bank only puts up for sale the cars in good condition. They may have scratches and minor things but overall good condition. I bought my wife's last car off a repo lot and it's been going for over 100k miles. Banks are easy to negotiate with and don't include alot of the fees that a dealer would.
Great info...just make sure that if you sign for a loan that it is a "simple interest" one and not a "rule of 78"s" one that front loads the interest. Those will cost you to pay off early and are still legal in some states...I asked an F&I guy this a few years ago and he said that he'd never been asked that before. He changed the lender to one that offered simple interest loans. Also, like Marko said, make sure there are no prepayment penalties...
Most of those “sum of digits” loans are at “buy here pay here” lots these days. Just look at the top of the truth in lending disclosure form - it should read “simple finance charge” or similar.
Good video. Totally agree with how he buys cars at the end of the video. That's how I've done it all my life and I'm an old guy. Never bought a new car until now. The used car market is so crazy here in Austin texas, actually got a better deal buying a new car from a dealership who didn't charge the market adjustment fee above msrp which everybody else seems to be doing now. Everybody using the supply chain shortage justification. So yes, really don't like buying new but no other viable options out there. And I've been studying the market for over 6 months. Good luck to anybody else who really needs to get a newer car in this economy.
I own 3 vehicles all paid for at time of sale To me it makes no sense to borrow money and leave your saving siting in a saving account earning practically earning zero interest while paying exorbitant interest rates offered by loan companies and if you want to finish early face penalty charges But every one to there own in my humble opinion the only way to borrow money is on property where the rising price of the property offsets the loan
Walked into a dealership 2 years ago. Test drove a 2014 Mustang GT with 60k miles. They were asking 19,500. I Iooked sales guy in the eye and wrote down my 20k cash offer out the door and not a dime more. He made me initial next to it. Dude went inside the office to "confirm" with manager. He came back with 20,300. I laughed and walked out. Not even 5 min later dude was blowing up my phone. I never went back. Don't be afraid to walk out people!
I had to walk out too. I offered a dealership Kelly blue book value for a vehicle that was nearly 15 years old with average miles. They didn't want to negotiate at all.
jessica jessie- I used that tactic with several years ago on a used Acura. They happily took the cash for blue book value. I’m sure it depends on the dealership and specific car to some extent.
Fuhq Boi I had a sales rep chase me as I walked out. We were exactly 15 dollars shy of what I wanted to pay. Kid says “ you’re not gonna buy your car because of $15 a month?” I said “NO, YOU aren’t selling ME the car over $15 a month.” And yes they will blow up your phone for weeks after if you don’t come back.
Great advice. We have purchased through eBay and from pp. When buying from a dealership we have found that if you find the car online and negotiate over the phone they lose much of their power because it's super easy to walk away by hanging up a phone. I've also walked away from multiple dealerships and even took a car back after a few days when they tried to change the interest rate after the fact!
In the past I used to do that. I would do it via email. The last few years things have been on their head, but before that, I would send an email to half a dozen dealerships around me, telling them exactly what I wanted, and asking them to reply with their best price, and I would come in and buy it from whoever had the best price. That I would not be having anyone match the best price, just taking the best price that they return with. Got some pretty good prices that way, because they wanted the sale, and did not want to be outbid by some other dealer by $1. Hopefully it will get that way again soon. Although I have been looking at a Model Y, so that would not work.
When buying a car from a private party your first question should be "Is the car registered in your name?", followed by "Can I see the title?". You want to make sure the person selling the car owns it and it isn't a salvage title. In my state AZ, it's also important to buy a car with a fresh emissions certificate since you cannot register a car without it and emissions repairs can cost hundreds or thousands of dollars.
What problems can arise if the title is not in their name? Was trying to buy a car recently on Craigslist, and the guy told me he is selling it for a friend who is out of the country. But why be honest about it? I wasn't planning on checking his ID. should checking ID be part of the buying process as well?
@@ve2430 Unless the guy has some power of attorney paperwork (which you'd have to have checked out to make sure it's legally air tight ) then I'd walk. Most private party scams start with " Well the car's not in my name... but.." Generally speaking the problems that can arise is the actual title holder can come back and say they never agreed to sell the car, thus invalidating the sale. You lose the car, and are told to go get your money back from the seller. Better hope the seller didn't leave the country with the money..
@@DEFkon001 yeah except I don't think they'd go through all that trouble for a 1500 dollar car. Would they? I bought it lol. Got the title in my name already
One of the things I learned is to wait for that final week of the month because that's when dealerships are trying to sell cars the most because the following month they have to pay insurance on every vehicle
@@feal1968 Next time this happens tell them you want a larger discount for longer financing terms and pay it off faster. My brother-in-law did this and paid it off in 2-3 years and it probably saved him $1500 or so.
Very nice basic pros & cons, however no mention of $$ saved on payments while leasing that can be invested elsewhere to maybe make up the difference in total costs.
I'm glad you added all the info on the end about finding a good used car...there was a lot of wisdom there! There are too many car poor people in this world!
Has nothing to do with being an immigrant to be honest, just about being smart, brand new cars literally lose 20-30% value moment you drive off lot, fastest depreciating asset around.
Absolutely correct info. Good job, Marko. As a former small used carlot owner, since we got out of the business we buy private party ONLY. Just like you said.
Great, great video! Especially the ending advice. Back in the high income days I bought a couple of new cars (and drove them into the ground) but now as a retiree I will only buy 5 year old or older cars and trucks. I have had my '04 Ford van for five years and my all in cost is under 5K. $1000.00/year is $84./month and I could probably sell it for 4K. Do the math.
plus ppl from a family with no cash for decades. To build a debt-free and disciplined positive cycle, all family members will have to sacrifice spending and quality of life, and after 2-3 generations they eventually have enough cash reserve. But do ppl enjoy suffering and waiting decades? Absolutely not. Most will demand everything right now, not waiting even a day. It's hard to go back to the pre-credit-card ages.
@@mingchi1855 Agreed, but it only takes one generation to change. My wife and I both came from families where our parents were in debt their whole lives. It motivated us so when we got married we worked our tails off to get high paying jobs and live way below our means. Now we have automatic savings where $xx automatically gets transferred to a car savings account. So much of what "normal" people spend goes to interest on things they can't afford to impress people they don't even like.
@@jake9167 Congrats on your success. Not everybody can sustain the "damage" from social media and peers. If someone tries to harm my feelings by showing their belongings, I simply do not regard them as friends. It's bitter pill to take but solves a lot of problems.
My wife and I figured out most of these tips over the years, but it's always nice when your experiences are affirmed with a few new bits of info. The most important part is to always be prepared to walk out if they say no. It helps to have two dealerships you can play against one another, too. That makes walking out after three or four hours of haggling easier.
From what little research I have done while shopping around for a used truck, I agree 'buying cars from private parties is the best way to get value' @ 11:58.
It is. RUclipsrs are under pressure to create unique content, hence they tend to put forward attention grabbing titles or advise. If a dealer offers you a sale price based on the assumption you are going to require finance and you change it at the last minute saying you will buy in cash, he can change the price. There is nothing to stop him from doing it. He can simply say the first price was based on financing and now that it's not needed, the price will change. It happened to me. So you must be ready to work away.
An advantage of buying for cash is the Dealer does not have to worry if you will qualify for the loan and thus he has a firm sale. A lot of people try to buy a car based on financing and they do not qualify so no sale. Wake up and smell some roses.
Totally Awesome Videos --- love how you don't pay cash upfront, and then pay off the loan in full (in cash) in next 30 days -- Thank You for taking the time to present and educate
@@erickurbano8847 No that's exactly it you're only gonna save a couple thousand depending on how used you go, but if you find the car you want with the features you like used, why not take the W and walk out spending less
I MISS the 'autos for sale' section of the newspaper!! That LAST place I want to go is a car dealership- I just don't know where to start these days, when it comes to buying from pp. Thanks for a super helpful video.
My son in law buys from individuals. He has always come out good and lots better on all the cars and trucks he has bought. He is training his two sons in that way you are right on your points.
I'm in the 5%! I've never bought new, always 3-5 year old used PP. Unless it's a write-off for your business, buying new or leasing is such a waste. Even buying a 2 year old car allows someone else to take the depreciation hit. Most new cars now have a 7 year, 100,000 mile warranty. You can usually piggyback on a few years of that as well.
I kept waiting for the point when you were going to say to them that you were paying cash but then you just dropped the hammer on them with the paying cash after getting a loan through them. Good stuff man
Say you made a mistake by going to the dealer makes as much sense for blaming a shark for biting you while swimming in the ocean. The blame falls only on yourself for being uninformed and ignorant. You buy from a dealership because laws protect you. Dealerships have responsibilities such as selling you a safe vehicle and abiding by banking laws. I never understood why people still made the purchase after thinking they got a bad deal. You got the deal you deserved.
@@dukespencer6676 They guy said it "feels like a total scam" and you feel the need to blame him for feeling like that? You felt compelled to call him "uninformed and ignorant" based on that? Come on, man.
I did this almost exact same thing to BMW 2 years ago when I bought my wife a car. I knew they were taking off money but bumping up the points. Gave them 10k down and financed it at a lower price for the car and just paid the car in full a month or 2 later. The only hit you take is a temporary one on your FICO score for the credit run and you take a slight hit for paying it off also.
Hey Marko, the last 3 cars I bought were private purchases and I've sold 2 of them for more than I paid for them. I don't ever consider purchasing from dealerships anymore. Good video.
Marko, I consider myself pretty savvy with money and finance but I never thought of this when buying a car lol. Negotiate as if you are financing but then pay off the loan 2 months later with cash and have all the benefits. 200 IQ.
This is an outstanding video well done. I bought a new CR-V for my Mom this year and played this exact game. After we had agreed on the price, and his final move was to roll the doc fee into the sales price, he said "So what kind of payments are we looking at?" I took great delight in saying "One great big one!" As his face fell.
As someone who is shopping for a good used Honda CR-V, I found this video VERY helpful. Most of my picks have been from dealerships (so far), but now I'm more inclined to look at private parties. Thank you for a clear, concise explanation!
Great advice! I pay cash for used, well-maintained cars from private people. I hate car payments - I did that once, never again. I still end up breaking even or profiting when I resell my cars. It’s like driving cars for free! Just use common sense and research, research, research - and know a good local mechanic. Never go to dealerships for repairs or maintenance. I used to work at a car dealership for import cars.
Most people, especially the well to do, will trade their cars at the dealership because they do not want the hassle of selling a car themselves. If you trade a car in you do not pay sales tax on the trade in value. You can cancel your insurance on the trade in immediately (instead of waiting until your old car sells which could take months unless your giving it away), you do not have to worry about maint. on the old car. You do not have to carry the license on the old car if you trade, You will have to finance more if you do not trade. You could be dealing with bad checks, counterfeit money or people that do not switch the title (which means you have liability). You do not have to advertise, take phone calls, give people test drives. Selling a car privately is a hassle.
@@robd1859 A vehicle is a depreciating asset, unless it’s an antique. So instead of spending my money on a new car, I invest in mutual funds and in real estate that appreciate in value over time. So far, so good! I get to drive a reliable used vehicle, plus I grow my assets. It’s called “being smart with my money”.
@@vincentvincent4898 I am not a car salesman, but I have sold my own cars from time to time privately. These days a lot more dishonest people than in the past (bad checks, counterfeit money). The last time I sold a car was 7 years ago and I held that car 7 months before I found a buyer. I had to put new tires on it to make it marketable. Anyone that does not 'give' their car away will have trouble selling it. And if you are going to give it away you may as well trade it in and save yourself risk and hassle. The last car I sold 7 years ago I got $3K and the dealer would have given me $1k on the trade in (real number). So a lot of people would have not gone to the trouble for that amount of time and money. And if you are older a lot of people think they can screw you over. You seem to be looking at this from a buyer perspective, getting a used car cheap. But even you are at risk buying from a private party as they could give you a counterfeit title, forged title, etc. More extreme cases could be car jacking and mugging.
This situation is similar to my last car purchase. After we had negotiated the final price, the dealer informed me they would reduce another $500 if I financed, and told me pretty much what Marko explained in the video: pay one or two months, then pay off the loan with no early penalty. They must have used a 3rd party for the financing, and I now would assume the $500 was their commission from that party for originating the loan. However, I did pay about $100 in loan costs, so I didn’t save the entire $500.
Also did that but only financed $5000.00 of $40,000 purchase price and paid it off 10 days later, got $1000.00 Bonus for financing . Paid $69.00 in interest charges!
I'm mechanically inclined, too. I know how to work the lever on a La-Z-Boy recliner like no one else. This is a great video not just about car buying, but about negotiation tactics. As a former car salesman (lot lizard), car dealerships exist purely to get you into a shiny new loan. The car is secondary. Most of a dealership's money is made in the used car lot. New cars have very little margin to work with unless you add on all the stuff Marko talked about in the video. I agree with the techniques in the video UNLESS the dealership (or the bank backing it) in any way get additional loan-related finance fees that would be avoided by simply paying cash at the purchase time. Personally, I'd rather just make them wait until the end of the negotiation, after a price has been settled, to tell them, Colombo style, Oh, yeah, one more thing, I'm paying cash. Also, NEVER EVER buy new unless you're rich and you are totally able to take that immediate 25% depreciation hit.
GREAT TIPS Great Video, , It's a fact you should buy from private owners you can negotiate the price there is no fees involved. Avoid buying from dealerships don't pay for any of their non-sense fees such as prep fees, advertising fees, destination fees, document fees, processing fees and gap fees specially on used vehicles. Great job in explaining how to pay cash after negotiation.
Private parties often charge full dealer retail these days. There was a time where it was easy to get a deal from the average seller, but that gap is becoming smaller and smaller. A lot of people think their cars are gold, especially if they have maintained them in the slightest. And unfortunately, eventually dummies are paying that high retail, so there is little incentive to price within reason.
wow! where have you been all this time! I bought my 2017 Accord V6(which they don't make anymore!) in full CASH 🤑🤑🤑 from a PP. Best investment ever! Totally agree with you on buying a used car and skip all the dealership BS!
Depends on how long you intend keeping the car. In the UK people are obsessed with PCP lease deals. Lower monthly payments because part of the cost of the car is deferred to the end of the agreement as a balloon payment, but most trade them in because they can't afford the final amount. This is particularly true with the so called premium brands, BMW, Audi etc. Our roads are filled with them yet nobody owns them. Its all about image these days and people would rather lease so they can get the another shiny fancy badged new model in a couple of years. I prefer straight Hire Purchase, its a lot simpler to work out and the salesman or woman can't baffle you with any of it. You pay more a month obviously but at least I will own the car at the end. You tend to find if someone needs to get a car on PCP, it means they can't really afford it. Its like renting a car. What a waste of money.
I lost over $70k when everything started to tank. Not because I was in an exchange that went belly up. I was just stupid to hold and because that's what everyone said. I'm still responsible. It just taught me to be a better investor now that I understand more of what could go wrong. It took me over two years of being in the market, I'm really grateful I found one source to recover my money, at least $10k profits weekly. Thanks Natalie Strayer. .
Natalie Strayer has really set the standard for others to follow, we love her here in Canada 🇨🇦 as she has been really helpful and changed lots of life's
I agree in concept, but as someone who doesn't want credit pulled unless absolutely necessary (it's good), this method isn't feasible. I'm a cash buyer who's not getting into negotiations involving finance inquiries so I see why you offer another option.
I agree Stephanie. I know what I’m going to pay for the car before I ever set foot in a dealership. Once the sales department has agreed to the price, I meet with the F&I rep and let him know that I will be paying by cashiers check or wire transfer. No extended warranty, protection plans or “value added” products. The dealer preps the vehicle and I process the transaction by check or transfer and take my new car home. I would never go through the hassle of applying for a loan I don’t need in order to save a $75.00 document fee. When I leave the dealership they’ve gotten my name, address, phone number and the name of my bank. No pay stubs, employer info, social security number, tax returns, or any of the onerous documentation required for a loan. The dealership may not like it, but I have yet to have anyone refuse to sell me a car.
i've always bought my cars for sale by private owner on the side of the road, I'm 67 and started at 21, never paid more than 2 800$ and some lasted up to 9 years.
I have bought several new vehicles over the years but I completely agree with you and I don't think I will ever buy new again......Buying slightly used in great shape avoids so many headaches of having to deal with the idiot dealerships not to mention you will be savings lots of money.
Not always true, I was honest up front told them what I would be paying cash and what would be financed. Did my homework and new the MSRP and destination cost (that I didn’t pay for) so I knew going in where my negotiation would start. Long story short I was able to purchase for $21,500 asking price was $26K. Great information thanks for sharing!
*Do you pay cash for cars, or do you finance and invest the difference?*
Question... does the dealership make money from the simple act of opening a loan? So even if we pay it off within that first month, is the dealership still making some sort of $$ from starting the paperwork?
For cars under $10k I pay cash. Anything above that I like to get low interest loans and no money down pay huge payments each month
I pay cash. However on my motorcycle I financed, because it was 0% finance.
7:59 never get GAP through the dealership. If you want GAP, either go to your credit union or better yet your insurance carrier.
Pozdrav brate Srbine :)
I'm 50 yrs old and owned a small dealership for years. Of course if your a dealer you'll go to auctions and buy cars. I've been out of the car business for some time and what this man is saying is gold. I do exactly what he said at the end of this video and have been for many years. I also set my alerts on CL and always look for high-end 1 owner cars. I almost felt as if he was giving away trade secrets but then I remembered, I don't have a dealership and am not selling cars for a living. You should thank the creator and then thank this man who made this video. Valuable info you wouldn't know without his generous effort to teach you. Peace.
When you are car shopping, are u paying Kelly blue book value or are the sellers selling to you for less than book value? If Kelly book says a Hyundai Tiburon 2003 GT great shape gets $5000 but it's got 156k miles, I believe for each year, 12,000 miles is the average car miles - so 2003 average miles in 2022 is going to be about 144,000 miles on it. If the car has 156k miles, you subtract $1000 for each 12,000 of miles off the price. So, I would offer the person $4000 instead of $5000 because of the milage. Obviously, I'm going to look at other factors as well but is this an approximate method for figuring out a fair price on a car? Kelly's blue book for a starting point.
nice
I love how you say thank The Creator. I hope you meant God that’s awesome. This guys videos are fantastic. Jesus is Lord!!!
@@maxwellmarlin880 No, God didn't make this video, Marko did. I'm not even sure god has a video camera.
God made Marko and blessed him with intelligence and the ability to learn.
I pay cash because
1. I’m trying to avoid debt
2. I don’t want to spend all that extra money in interest
Private party is a good way If you have a diagnostic tool you can plug it into the car and make sure everything's OK
💯 Well worth the money if you don't have one . Even if it's only going to be used one time 👍
In 2010 I purchased a new Honda Pilot. They had a special deal on financing where I saved like $2000 that they couldn’t give me for paying cash. So I took the loan, got the discount and then paid off the loan.
I did the same thing to Hyundai. Paid it off the first month.
Superb video, and you explained exactly what I did to get the best deal on a new car from a dealership. 1. Leave all options open (new/used, finance/pay cash, trade-in/no trade-in. 2. Be non-committal until the very end. 3. Negotiate the PRICE OF THE CAR ONLY until you agree on a price; then finance it for one or two months, and then pay it all off after 2 months. This is absolutely the best way to get a great deal on the car (finance manager thinks you are financing the car and gives you a break on the price, then you pay it off in 2 months so you don’t have to pay exorbitant interest rates).
Another thing: never start negotiating the price on first visit to the dealership. Most of my car purchases happened over a period of 4 or so months so they knew I was serious; and I usually bought at the end of the month so the dealership was incentivized to sell in order to reduce carrying costs of the vehicle over another month.
Yet another thing: always have a holdover comment to use as leverage (something you honestly don’t like about the vehicle in question - but don’t absolutely have to have). You can use this for leverage when negotiating price. For me, it was style of wheels, or a particular feature they didn’t offer which other dealerships (or vehicles) did - could be something as simple as rear heated seating, ventilated front seats, or wireless charging option.
All these things (plus trying not to show too much enthusiasm) will help you to financially negotiate the best deal.
Again, thank you, Marko, for a superb video!
I never return to a dealer and no negotiation should take more than 5 mins.
How does paying the loan off in 2 months affect your credit? That's my biggest concern
What if the dealer does not negotiate on price? I prefer dealers who don't fiddle fart around and dicker on the damn price. The sticker price IS the price, as far as I'm concerned.
Ok so story time-
My cousin, who is blonde, played up the “I’m a dumb blonde girl and do not know anything about cars” trope when she went to the dealership to get a Lexus. She did so many stupid things like open the trunk and said “Oh my god! Where’s the engine?” Or she pretend to not be able to open the door “bouncing” her Ta Ta’s the whole time in front of the salesman.
When it came time to buy the car she played up the dumb blonde thing again and they offered to finance in house with this ridiculous rate. Like 20% or something in exchange they took thousands off the price for her to make it look like she got a deal.
The next day she came back in her business suit and paid off the loan. THEY WERE PISSED. She is one of my favorite cousins.
I walk in with $100 bills sticking out of all my pockets and pretend to be drunk.
Car loans are simple interest not compound interest, which means they add the interest of the total term of the loan to the principle of the loan right there from day one, divide the total amount by the number of payments and that is the amount of your monthly payment, regardless of when you pay it off you end up paying the same amount: the total principle + total interest.
@@had2043 I never heard that before?
@@had2043 unless you think a customer is an idiot and try to skirt around. I don’t know how logistically it happened but it did. I’m not sure what your comment is suppose to prove other then that Lexus did not do their due diligence.
@Brad Olson that is what I thought unless there a stipulation where there a penalty. Bc I posted this question before n never read an answer. Go through the whole salesperson spill get the lowest n just pay it off the next month.
The most powerful 4 words when negotiating the sale price and the fees, "That's not good enough". Don't be afraid to walk away if the offer isn't good enough. Great video - thanks!
"That's not good enough" was a line from Schindler's List.
"Okay sir, we can give you this $30,000 car for free." That's not good enough.
@@jonathancorcoran9427 you were given a brain for free. I guess that wasn't good enough.
@@iseehowitis9382 Was making a joke.
until you out smart yourself and walk out on a phenomenal deal haha. i see it all the time.
I bought a mini van for my wife using the above and went back about one year later to buy a truck for my company, they recognized me and threw me out of the dealership, the best day ever.
Bought a car last year at a dealer. I asked about financing, worked on what bottom-dollar would be etc. After we settled on the price, I just switched it up and wrote a check. The finance guy got pretty forgetful and uncomfortable but I sealed the deal my way (I planned on paying in full before we even started the process, I just didn't let them know that until it was all done).
We did the exact same thing when we bought our new Highlander last year. We also negotiated the bottom line price via financing, and then wrote the check. They weren’t thrilled, but we had the price we’d wanted in writing.
I was wondering how this works. I can see doing it Marko's way but I guess doing it your way I suppose the dealer could get upset but why would I care about that. What I don't know, could the dealer cancel the deal at this point? That's my only fear and it may be unfounded and I may be over thinking it 🙂. I'm paying for my next car in full, either financing and paying off in 30 days or by whipping out the check book.
I would like to know if the dealer can cancel the deal. What "in writing" do I need exactly?
I’m not sure how it would be at every dealer, of course…but from the moment the sales guy said hello, until everything had been worked through with the finance manager, I honestly told them that we weren’t sure if we were financing or paying cash. And honestly, the bottom lines either way weren’t terribly far apart.
@@NunoGabriel the dealer or you can cancel the deal at any time if you haven't already taken possession of the vehicle. Either way, you should get your money back. Any steps beyond that with you in possession of the vehicle turns the tables. Beyond that, I'm not sure what we're talking about.
What I took away from this segment was rich people buy assets and poor people buy loans.
- 👍 Spot on brother fantastic video.
Hadouken Hadouken or... rich people don’t NEED loans, because they’re...RICH
Depending on what rate you get your financing, it may sometimes make sense to go with the financing for instance 0 percent (if your lucky) to say 1.9 or 2.9%, say rather than pull from your 401k or if your really savvy like me and index fund, they net between 5-10% for the amount you have in there. Your money better serves you in the index/401k, then if you were to take it out and pay cash to avoid the 2.9% (average financing for good credit).
This is a HUGE takeaway, thanks for this insight
I took out a totally unnecessary loan for a car in January. Low interest rate and didn't put a single dollar down cause my credit is perfect. Didn't need a loan but figured it might be smarter to keep the extra cash on hand for other investments...
Fast forward to June... More than doubled all that cash on the stock market and my loan interest rate is now less than most inflation projections because of covid stimulus money printing.
A Car is one of the fastest depreciating assets around
I always make sure the ODO price is locked in at the salesperson’s desk, and I ask for a breakdown(tax, delivery, document etc.). If it changes(+), I’ll walk. Also, you can negotiate interest rates. Get a print out of a low rate from your credit union/bank and ask them to match it.
ODO price?
@@elliottpeabody1287out the door price
In general sales people are not authoried to lock in prices. Maybe you live in a country that is not the usa.
@@tommak6516 This pertains to the US. I worked in car sales during college. It doesn’t matter who has to sign off, but yes typically it has to be a sales Mgr. My point is if they can’t present the accurate final cost at the salesperson’s desk, no need to go any further. By final cost, I’m referring to total price if you’re paying cash. Interest rates/payments are typically handled in the business office but have seen exceptions there too.
This is amazing. “Wealth has no shortcuts, there’re ways to attain it.”
the first step to gaining wealth is figuring-out your goals either on your own or with heIp of a financiaI pIanner and foIIowing through with InteIIigent pIans; you wiII gain financiaI growth in no time and enjoy the decision of managing your finance
I had decisions that grew my finances (gathered over 1M in 2yrs) with heIp of my financiaI pIanner. Living the dream, hoping to retire next year.g
Elizabeth Greenhunts
get to her with the name
I just bought a new transit & did the exact same thing with the B/S fees. They took them right off the price of the vehicle, as you said. It was an easy discount. They wanted to sell the van, & I really wanted the van, but told them, if they didn't remove it, I'd walk. The buyer holds the cards.
You're not truthful. There are no transit vans available to buy., and if there is you will be paying over MSRO
@@stan4800 Wrong. My dad did that all of the time.
@@jimroscovius you are living in the past. I am a ford salesman for 20 years. Everything we sell today is more than MSRP.
@@stan4800 Then I don't buy. That's why I'm driving my 2011 Traverse, bought for cash in 2013. When I do buy, it will be for cash again. If they want my money, they'll deal. If they don't, fine.
@@jimroscovius No one cares if you pay cash or finance. The bank gives the money to the dealer just as fast as your cash. Welcome to 2022
I am a Dave Ramsey follower, so when I saw the title I decided to watch the video, but I knew I was gonna have to leave a comment about how debt=risk blah, blah, blah. I stand corrected, this is very solid advice, I still believe that when I have the money to buy a car I will do it with a private party.
"Dave Ramsey follower!" You have my sympathy.
I LOVE YOUR TALKS.I WISH YOU LIVED IN CT..MY WIFE AND I NEED TO TRADE A CAR IN..THANK YOU FOR ALL THE INFO...THANKS AGAIN..
Lowkey so much value in this video
Thanks Brian!
*HighKey...
Greeaat video, learned a lot...
Unreal. 🤦♂️ what a stupid video with stupid information. But ya go ahead and buy a car from an individual party.
Not at all
Don’t let Marko near your girlfriend
I'm happily married. Maybe in my college years 😂
@@ethanswimmer1287 Is it necessary? Get over it, it's 2020.
Shid i don't let me around my girlfriend,
Jk no girlfriend single🤥
In his college years, he had girls pay him to cheat
Pamela Waiters I’m a guy and I’m calling it like I see it. Yes Marko is handsome, I can say that because confident Alpha males can.
Super video. I do the same thing. Buy luxury vehicles from decent people.
Amazing advice, I paid cash for a used BMW at a dealership and fell into the same traps you outlined in this video. It is old school thinking to believe that telling them you are paying cash will help you negotiate!
Love this man! So many people walk in to a dealership and just bend over and still think they got a "good deal". Thanks for the ammo I'll definitely be using this.
Carfax and pre-buy inspection for CL for sure. Good vid!
Well presented. Best advice I ever got and has proved true regarding dealership salesmen is " don't hesitate to walk"....what you're saying along with that mindset is the way to go.
I "pretended" to walk away at a used car dealership and the guys kindly encouraged me to return so he could accept my offer. It works!
Yes, I even created a '' fake '' scene that drew other potential buyers attention, they really didnt like. I got the deal I wanted.
Good shieeet broski 2 years later and still relevant
Great information on here. Excellent job. Another thing to add for those smart people watching this before going in to dealership. Don’t purchase a car whose total price is more than half of what you make a yeAr. Regardless if your paying cash. Your essentially buying a depreciation asset. Put your money somewhere it will grow. Or at least not depreciate as badly as cars do.
Been in my fair share of dealers, bought plenty of cars in my time, this guy *definitely* knows what he's talking about. Don't get lured by the shiny new metal, you're just financing depreciation.
@Richard Favreau That's _just_ what they want you to think. You're not finessing anyone at a dealer. You cannot neutralize depreciation. Those are one time discounts. Depreciation is forever.
@Richard Favreau Ah yes, manipulation of statements, I heard Fox News is hiring. There's nothing inherently wrong with financing until it is that the value to cost ratio is outweighed, which is done so often with most car buyers. You can pretend that life is a commerical and everyone has great credit with opportunity for rebates, but that's not 80% of America.
If you want be a shill for big banks and car manufacturers, that's fine. There's a reason they got enough money to wrap around the world, and it's definitely not because people are outsmarting them. I'm just here to inform.
Great information! I am retired now and cannot afford to spend a lot of money for a car that I will seldom drive. The car I own now is 19 years old. I bought it from Enterprise car rental. The car I had before this one I bought from Hertz rental. It lasted over 13 years. I have never owned anew car.
PAY CASH, just DON’T TELL dealerships that you’re paying cash!
That's what the title should read, instead of the click bait title.
Nothing about this title was click bait. The video was about not paying cash at the dealership, then paying cash after. 🧠
Marko - WhiteBoard Finance what?!
Responding to the comment under yours. Relax
Marko - WhiteBoard Finance I know, but what are you talking about?
let them think your not paying cash, then once the out the door price is agreed upon throw that cash, 😅
🤣🤣🤣
Thats how I do it. Bring price comparisons from atleast 3 different places. Tell them if they can beat the lowest prices they get sale. Once they agree then tell them you will pay cash. If they try to recoup by pushing doc fees, warranties....walk.
@@carlhammill5774 wait so.. how are you saving money by hiding that you're paying cash?
Isn't the price of the car, the price of the car. so whether you're paying cash or financing, they're gonna charge you the price of the car plus bs fees.
I watched the video, but don't really understand where the savings are coming from aside from avoiding GAP and accessories.
@@JulesTradesThe savings come from how quickly you pay off the loan. Find out if the loan has a penalty fee for paying it off early. If it doesn't, get the loan in exchange for getting a lower price on the car. Then pay the loan off early so that you won't owe interest on the amount. In that way, you still pay cash; just not to the dealer.
@@JulesTrades When you pay cash there is no interest fees. When you finance there is interest, and dealerships make money off that interest.
When you tell them you are financing they are more flexible with the price of the car as they know they will get the money back on interest payments on your finance. When you tell them you're paying cash they will not budge on the price as you are not making them any payments after you take the car.
So by telling them you are financing you can negotiate the car price lower but then still pay cash in the end; this is the ultimate endgoal of a successful deal done in a dealership.
yes,you save a lot buying from private parties....just don't buy too old cars,just buy cars that still are under warranty....good info Marko!
I agree with what you said. Another great place to buy a used car is check with your local credit union for repo cars. My bank only puts up for sale the cars in good condition. They may have scratches and minor things but overall good condition. I bought my wife's last car off a repo lot and it's been going for over 100k miles. Banks are easy to negotiate with and don't include alot of the fees that a dealer would.
Great info...just make sure that if you sign for a loan that it is a "simple interest" one and not a "rule of 78"s" one that front loads the interest. Those will cost you to pay off early and are still legal in some states...I asked an F&I guy this a few years ago and he said that he'd never been asked that before. He changed the lender to one that offered simple interest loans. Also, like Marko said, make sure there are no prepayment penalties...
Most of those “sum of digits” loans are at “buy here pay here” lots these days.
Just look at the top of the truth in lending disclosure form - it should read “simple finance charge” or similar.
Ohhh bro you brake my hart when you name VW and Porsche in the end of that video
Very very helpful
THANK-YOU
Good video. Totally agree with how he buys cars at the end of the video. That's how I've done it all my life and I'm an old guy. Never bought a new car until now. The used car market is so crazy here in Austin texas, actually got a better deal buying a new car from a dealership who didn't charge the market adjustment fee above msrp which everybody else seems to be doing now. Everybody using the supply chain shortage justification. So yes, really don't like buying new but no other viable options out there. And I've been studying the market for over 6 months. Good luck to anybody else who really needs to get a newer car in this economy.
Thank you for sharing Jorge, what’s a market adjustment fee? I’m interested and willing to go to said dealership, do you know the name?
I paid my brand new 2015 Honda Fit in full before I drove off the dealer parking lot. No monthly payments or financing.
I own 3 vehicles all paid for at time of sale To me it makes no sense to borrow money and leave your saving siting in a saving account earning practically earning zero interest while paying
exorbitant interest rates offered by loan companies and if you want to finish early face penalty charges But every one to there own in my humble opinion the only way to borrow money is on property where the rising price of the property offsets the loan
Walked into a dealership 2 years ago. Test drove a 2014 Mustang GT with 60k miles. They were asking 19,500. I Iooked sales guy in the eye and wrote down my 20k cash offer out the door and not a dime more. He made me initial next to it. Dude went inside the office to "confirm" with manager. He came back with 20,300. I laughed and walked out. Not even 5 min later dude was blowing up my phone. I never went back. Don't be afraid to walk out people!
Um... You should have went back because he would have hit your target. That is how negotiation tactics work. You would have gotten what you wanted...
I had to walk out too. I offered a dealership Kelly blue book value for a vehicle that was nearly 15 years old with average miles. They didn't want to negotiate at all.
jessica jessie- I used that tactic with several years ago on a used Acura. They happily took the cash for blue book value. I’m sure it depends on the dealership and specific car to some extent.
Shout out to everybody who's trying to learn something from this amazing man !!!
Fuhq Boi I had a sales rep chase me as I walked out. We were exactly 15 dollars shy of what I wanted to pay. Kid says “ you’re not gonna buy your car because of $15 a month?” I said “NO, YOU aren’t selling ME the car over $15 a month.” And yes they will blow up your phone for weeks after if you don’t come back.
Great advice. We have purchased through eBay and from pp. When buying from a dealership we have found that if you find the car online and negotiate over the phone they lose much of their power because it's super easy to walk away by hanging up a phone. I've also walked away from multiple dealerships and even took a car back after a few days when they tried to change the interest rate after the fact!
In the past I used to do that. I would do it via email. The last few years things have been on their head, but before that, I would send an email to half a dozen dealerships around me, telling them exactly what I wanted, and asking them to reply with their best price, and I would come in and buy it from whoever had the best price. That I would not be having anyone match the best price, just taking the best price that they return with. Got some pretty good prices that way, because they wanted the sale, and did not want to be outbid by some other dealer by $1. Hopefully it will get that way again soon. Although I have been looking at a Model Y, so that would not work.
Negotiating over the phone? 🤣
When buying a car from a private party your first question should be "Is the car registered in your name?", followed by "Can I see the title?". You want to make sure the person selling the car owns it and it isn't a salvage title. In my state AZ, it's also important to buy a car with a fresh emissions certificate since you cannot register a car without it and emissions repairs can cost hundreds or thousands of dollars.
And air conditioning !! Phoenix is no joke 😂
What problems can arise if the title is not in their name? Was trying to buy a car recently on Craigslist, and the guy told me he is selling it for a friend who is out of the country. But why be honest about it? I wasn't planning on checking his ID. should checking ID be part of the buying process as well?
@@ve2430 Unless the guy has some power of attorney paperwork (which you'd have to have checked out to make sure it's legally air tight ) then I'd walk. Most private party scams start with " Well the car's not in my name... but.."
Generally speaking the problems that can arise is the actual title holder can come back and say they never agreed to sell the car, thus invalidating the sale. You lose the car, and are told to go get your money back from the seller. Better hope the seller didn't leave the country with the money..
@@DEFkon001 yeah except I don't think they'd go through all that trouble for a 1500 dollar car. Would they? I bought it lol. Got the title in my name already
@@ve2430 Yes always check ID against ownership, and the selling it for a friend story should be very worried about that.
I knew about everything you described with the exception of using fees as a negotiating tactic. But buying from others is definitely the way to go.
One of the things I learned is to wait for that final week of the month because that's when dealerships are trying to sell cars the most because the following month they have to pay insurance on every vehicle
Good stuff I sent my son a link he's car shopping right now.
Get a local shop to do a used car inspection. Costs $50 and saves you the worry. If the seller says no, run away.
Shout out to everybody who's trying to learn something from this amazing man !!!
Dude! God bless you man! This video here is so helpful!
Take all the rebates, which generally means financing at the higher rate through the manufacture, but then pay it all off on first bill.
Csn you explain that a bit more? I have seen this mentioned few times but not exactly sure how this works
I learned this the hard way. Definitely seems dealerships are selling loans now instead of cars.
They tried selling me a 7yr loan when I bought my civic..who in their right mind?
@@MagicMetalMoney Pretty crazy. They were half joking when they offered but I'm sure they would have let me apply if I didn't know any better :(
@@feal1968 Next time this happens tell them you want a larger discount for longer financing terms and pay it off faster. My brother-in-law did this and paid it off in 2-3 years and it probably saved him $1500 or so.
What's your channel about?
Hello I will like to know on a Acura 2017 it see really necessary to put a warranty on the car? she already has warranty
Very nice basic pros & cons, however no mention of $$ saved on payments while leasing that can be invested elsewhere to maybe make up the difference in total costs.
I'm glad you added all the info on the end about finding a good used car...there was a lot of wisdom there! There are too many car poor people in this world!
From an immigrant to a son of an immigrant I loved the part when you said I don't buy New cars and I don't lease cars that's the best way to go....
Has nothing to do with being an immigrant to be honest, just about being smart, brand new cars literally lose 20-30% value moment you drive off lot, fastest depreciating asset around.
Good Information, except for in this car market used cars are going for more than new.
Absolutely correct info. Good job, Marko. As a former small used carlot owner, since we got out of the business we buy private party ONLY. Just like you said.
how do you avoid stolen cars and cars that were in floods or major accidents?
Great, great video! Especially the ending advice. Back in the high income days I bought a couple of new cars (and drove them into the ground) but now as a retiree I will only buy 5 year old or older cars and trucks. I have had my '04 Ford van for five years and my all in cost is under 5K. $1000.00/year is $84./month and I could probably sell it for 4K. Do the math.
Thanks!
You bet!
All the dislikes are from car dealerships salesman 👨💼
plus ppl from a family with no cash for decades. To build a debt-free and disciplined positive cycle, all family members will have to sacrifice spending and quality of life, and after 2-3 generations they eventually have enough cash reserve. But do ppl enjoy suffering and waiting decades? Absolutely not. Most will demand everything right now, not waiting even a day. It's hard to go back to the pre-credit-card ages.
I disagree with your comment. I'm a salesperson and I agree to what he said .. i tell my custumers about this all the time
@@mingchi1855 Agreed, but it only takes one generation to change. My wife and I both came from families where our parents were in debt their whole lives. It motivated us so when we got married we worked our tails off to get high paying jobs and live way below our means. Now we have automatic savings where $xx automatically gets transferred to a car savings account. So much of what "normal" people spend goes to interest on things they can't afford to impress people they don't even like.
@@jake9167 Congrats on your success. Not everybody can sustain the "damage" from social media and peers. If someone tries to harm my feelings by showing their belongings, I simply do not regard them as friends. It's bitter pill to take but solves a lot of problems.
@@jake9167 So you try to impress people on youtube instead . Kudos
My wife and I figured out most of these tips over the years, but it's always nice when your experiences are affirmed with a few new bits of info. The most important part is to always be prepared to walk out if they say no. It helps to have two dealerships you can play against one another, too. That makes walking out after three or four hours of haggling easier.
From what little research I have done while shopping around for a used truck, I agree 'buying cars from private parties is the best way to get value' @ 11:58.
And here I thought telling the dealership I'm paying cash would give me the best deal. Thank you for this.
It is. RUclipsrs are under pressure to create unique content, hence they tend to put forward attention grabbing titles or advise. If a dealer offers you a sale price based on the assumption you are going to require finance and you change it at the last minute saying you will buy in cash, he can change the price. There is nothing to stop him from doing it. He can simply say the first price was based on financing and now that it's not needed, the price will change. It happened to me. So you must be ready to work away.
An advantage of buying for cash is the Dealer does not have to worry if you will qualify for the loan and thus he has a firm sale. A lot of people try to buy a car based on financing and they do not qualify so no sale. Wake up and smell some roses.
Totally Awesome Videos --- love how you don't pay cash upfront, and then pay off the loan in full (in cash) in next 30 days -- Thank You for taking the time to present and educate
I looked at used cars before but the prices were only few thousands less from the new cars especially Toyota
Exactly right!? Pretty much any other brand is the same thing, that’s why I still wonder what’s better if get a new car or used one....
@@erickurbano8847 No that's exactly it you're only gonna save a couple thousand depending on how used you go, but if you find the car you want with the features you like used, why not take the W and walk out spending less
I MISS the 'autos for sale' section of the newspaper!! That LAST place I want to go is a car dealership- I just don't know where to start these days, when it comes to buying from pp.
Thanks for a super helpful video.
Thank you. Everyone who wants to buy a car should see this first. Pressure can be intense in the back room.
My son in law buys from individuals. He has always come out good and lots better on all the cars and trucks he has bought. He is training his two sons in that way you are right on your points.
I'm in the 5%! I've never bought new, always 3-5 year old used PP. Unless it's a write-off for your business, buying new or leasing is such a waste. Even buying a 2 year old car allows someone else to take the depreciation hit. Most new cars now have a 7 year, 100,000 mile warranty. You can usually piggyback on a few years of that as well.
Had to download this. Thank you for this video!
I kept waiting for the point when you were going to say to them that you were paying cash but then you just dropped the hammer on them with the paying cash after getting a loan through them. Good stuff man
I agree with you 100%.
I only bought a car in a dealer once and it feels like a total scam.
Never again.
Say you made a mistake by going to the dealer makes as much sense for blaming a shark for biting you while swimming in the ocean. The blame falls only on yourself for being uninformed and ignorant. You buy from a dealership because laws protect you. Dealerships have responsibilities such as selling you a safe vehicle and abiding by banking laws. I never understood why people still made the purchase after thinking they got a bad deal. You got the deal you deserved.
@@dukespencer6676 They guy said it "feels like a total scam" and you feel the need to blame him for feeling like that? You felt compelled to call him "uninformed and ignorant" based on that? Come on, man.
@@dukespencer6676Whats wrong with you?
Very helpful. Thank you Marko!
I did this almost exact same thing to BMW 2 years ago when I bought my wife a car. I knew they were taking off money but bumping up the points. Gave them 10k down and financed it at a lower price for the car and just paid the car in full a month or 2 later. The only hit you take is a temporary one on your FICO score for the credit run and you take a slight hit for paying it off also.
Hey Marko, the last 3 cars I bought were private purchases and I've sold 2 of them for more than I paid for them. I don't ever consider purchasing from dealerships anymore. Good video.
What does he mean by private purchasers? Like Craigslist?
@@samanthaaaz22 Yes, Craigslist or any site like cars.com, autotrader.com, etc. You can filter your results to show private sellers only.
Did you resell them to private buyers or dealerships?
@@sbley Sold 3 to private buyers and 1 to a dealership.
Thank you, awesome tips... learnt much watching your video...Sandy South Africa
Marko, I consider myself pretty savvy with money and finance but I never thought of this when buying a car lol. Negotiate as if you are financing but then pay off the loan 2 months later with cash and have all the benefits. 200 IQ.
No interest ? You end up paying the total that was negotiated ?
@@zhanazhana1001 you end up paying the reduced car price
And interest within 2 months is nearly nothing. So it's a win.
@@gonzaloenrique8741 got it ! Thank you !!
@@Enciphered_deciphered I’m a first time car buyer so I’m racking up on information. You got your loan through a credit union vs with the dealership?
@@zhanazhana1001 Yes, get your credit union approval first tou have tendencies of getting better rate than the dealership
I just paid of my 13 Toyota Camry and would never take out another loan for a car. Thanks for the knowledge
This is an outstanding video well done.
I bought a new CR-V for my Mom this year and played this exact game. After we had agreed on the price, and his final move was to roll the doc fee into the sales price, he said "So what kind of payments are we looking at?" I took great delight in saying "One great big one!" As his face fell.
“Where we service you with no lube” lmfao
I briefly caught that. Could have a couple of directions with that comment :) It was a subtle quick comment.
Lmaoo who else went to the comment section immediately after hearing that?
Lol
As someone who is shopping for a good used Honda CR-V, I found this video VERY helpful. Most of my picks have been from dealerships (so far), but now I'm more inclined to look at private parties. Thank you for a clear, concise explanation!
Just be sure to get GAP insurance, especially with prices where they are these days.
Dammit! I'm in the same search rn.
I think what you said is awesome, and now I wish I had known this when I purchased my Kia in October, wow just great, thank you
Great advice!
I pay cash for used, well-maintained cars from private people. I hate car payments - I did that once, never again. I still end up breaking even or profiting when I resell my cars. It’s like driving cars for free! Just use common sense and research, research, research - and know a good local mechanic. Never go to dealerships for repairs or maintenance. I used to work at a car dealership for import cars.
Most people, especially the well to do, will trade their cars at the dealership because they do not want the hassle of selling a car themselves. If you trade a car in you do not pay sales tax on the trade in value. You can cancel your insurance on the trade in immediately (instead of waiting until your old car sells which could take months unless your giving it away), you do not have to worry about maint. on the old car. You do not have to carry the license on the old car if you trade, You will have to finance more if you do not trade. You could be dealing with bad checks, counterfeit money or people that do not switch the title (which means you have liability). You do not have to advertise, take phone calls, give people test drives. Selling a car privately is a hassle.
That's exactly what I would say if I couldn't afford a new car
@@tommak6516 Are you a car salesman?
@@robd1859 A vehicle is a depreciating asset, unless it’s an antique. So instead of spending my money on a new car, I invest in mutual funds and in real estate that appreciate in value over time. So far, so good! I get to drive a reliable used vehicle, plus I grow my assets. It’s called “being smart with my money”.
@@vincentvincent4898 I am not a car salesman, but I have sold my own cars from time to time privately. These days a lot more dishonest people than in the past (bad checks, counterfeit money). The last time I sold a car was 7 years ago and I held that car 7 months before I found a buyer. I had to put new tires on it to make it marketable. Anyone that does not 'give' their car away will have trouble selling it. And if you are going to give it away you may as well trade it in and save yourself risk and hassle. The last car I sold 7 years ago I got $3K and the dealer would have given me $1k on the trade in (real number). So a lot of people would have not gone to the trouble for that amount of time and money. And if you are older a lot of people think they can screw you over. You seem to be looking at this from a buyer perspective, getting a used car cheap. But even you are at risk buying from a private party as they could give you a counterfeit title, forged title, etc. More extreme cases could be car jacking and mugging.
The advice at the end was a gem
such a nice dude well explained thank you so much i like your humor keep it it up those informative vids
This situation is similar to my last car purchase. After we had negotiated the final price, the dealer informed me they would reduce another $500 if I financed, and told me pretty much what Marko explained in the video: pay one or two months, then pay off the loan with no early penalty. They must have used a 3rd party for the financing, and I now would assume the $500 was their commission from that party for originating the loan. However, I did pay about $100 in loan costs, so I didn’t save the entire $500.
They also get a kickback of about 5 percent of whatever you finance
Also did that but only financed $5000.00 of $40,000 purchase price and paid it off 10 days later, got $1000.00 Bonus for financing . Paid $69.00
in interest charges!
@@user-qy9tf2im7f Now THAT was smart!! I'll be doing the same.
Loved the end of the video! Wife and I just did a private party car purchase and saved so much on a decent vehicle! Keep up the great work!
Great advice Sir, private buying is not for the faint hearted, doesn’t faze me but so many people won’t do it
I'm mechanically inclined, too. I know how to work the lever on a La-Z-Boy recliner like no one else.
This is a great video not just about car buying, but about negotiation tactics. As a former car salesman (lot lizard), car dealerships exist purely to get you into a shiny new loan. The car is secondary. Most of a dealership's money is made in the used car lot. New cars have very little margin to work with unless you add on all the stuff Marko talked about in the video. I agree with the techniques in the video UNLESS the dealership (or the bank backing it) in any way get additional loan-related finance fees that would be avoided by simply paying cash at the purchase time. Personally, I'd rather just make them wait until the end of the negotiation, after a price has been settled, to tell them, Colombo style, Oh, yeah, one more thing, I'm paying cash.
Also, NEVER EVER buy new unless you're rich and you are totally able to take that immediate 25% depreciation hit.
Great response. Thanks Dean! 👍🏻✌🏼😎
Good words.
I drive my vehicles for 12 to 15 years.
I can see taking the depreciation on a new vehicle if one intends to keep it long enough.
So how many years back do you suggest to go for a used car??
@@wuzgoanon9373 I'm the same way. Buy new and baby 'em with TLC. Never liked the idea of driving someone's former lunch room, dog cage, etc.
GREAT TIPS Great Video, , It's a fact you should buy from private owners you can negotiate the price there is no fees involved. Avoid buying from dealerships don't pay for any of their non-sense fees such as prep fees, advertising fees, destination fees, document fees, processing fees and gap fees specially on used vehicles. Great job in explaining how to pay cash after negotiation.
Thank you so much I learned a lot from you
Private parties often charge full dealer retail these days. There was a time where it was easy to get a deal from the average seller, but that gap is becoming smaller and smaller. A lot of people think their cars are gold, especially if they have maintained them in the slightest. And unfortunately, eventually dummies are paying that high retail, so there is little incentive to price within reason.
wow! where have you been all this time! I bought my 2017 Accord V6(which they don't make anymore!) in full CASH 🤑🤑🤑 from a PP. Best investment ever! Totally agree with you on buying a used car and skip all the dealership BS!
Best video I’ve seen so far on buying cars. My weakness has been the inability to walk away.
Introduced to you through a newsletter and truly appreciate your guidance on all things financial. Wishing you the very best in life.
One of the best videos on how to buy a vehicle.
Depends on how long you intend keeping the car. In the UK people are obsessed with PCP lease deals. Lower monthly payments because part of the cost of the car is deferred to the end of the agreement as a balloon payment, but most trade them in because they can't afford the final amount. This is particularly true with the so called premium brands, BMW, Audi etc. Our roads are filled with them yet nobody owns them. Its all about image these days and people would rather lease so they can get the another shiny fancy badged new model in a couple of years. I prefer straight Hire Purchase, its a lot simpler to work out and the salesman or woman can't baffle you with any of it. You pay more a month obviously but at least I will own the car at the end. You tend to find if someone needs to get a car on PCP, it means they can't really afford it. Its like renting a car. What a waste of money.
I lost over $70k when everything started to tank. Not because I was in an exchange that went belly up. I was just stupid to hold and because that's what everyone said. I'm still responsible. It just taught me to be a better investor now that I understand more of what could go wrong. It took me over two years of being in the market, I'm really grateful I found one source to recover my money, at least $10k profits weekly. Thanks Natalie Strayer. .
The very first time we tried, we invested $2000 and after a week, we received $9500. That really helped us a lot to pay up our bills.
Natalie Strayer has really set the standard for others to follow, we love her here in Canada 🇨🇦 as she has been really helpful and changed lots of life's
I'm new at this, please how can I reach her?
After I raised up to 125k trading with her I bought a new House and a car here in the states also paid for my son's surgery
Glory to God shalom.
Sure! She interacts on what's App using the digit below 👇
👍👍 Thank you for the info. Looking to buy a truck. 2020 / 2021 tacoma
Never thought of getting loan and simply paying it off! Good idea and thanks Marko
I agree in concept, but as someone who doesn't want credit pulled unless absolutely necessary (it's good), this method isn't feasible. I'm a cash buyer who's not getting into negotiations involving finance inquiries so I see why you offer another option.
Why don't you want your credit pulled?
I agree Stephanie. I know what I’m going to pay for the car before I ever set foot in a dealership. Once the sales department has agreed to the price, I meet with the F&I rep and let him know that I will be paying by cashiers check or wire transfer. No extended warranty, protection plans or “value added” products. The dealer preps the vehicle and I process the transaction by check or transfer and take my new car home. I would never go through the hassle of applying for a loan I don’t need in order to save a $75.00 document fee. When I leave the dealership they’ve gotten my name, address, phone number and the name of my bank. No pay stubs, employer info, social security number, tax returns, or any of the onerous documentation required for a loan. The dealership may not like it, but I have yet to have anyone refuse to sell me a car.
i've always bought my cars for sale by private owner on the side of the road, I'm 67 and started at 21, never paid more than 2 800$ and some lasted up to 9 years.
I have bought several new vehicles over the years but I completely agree with you and I don't think I will ever buy new again......Buying slightly used in great shape avoids so many headaches of having to deal with the idiot dealerships not to mention you will be savings lots of money.
Not always true, I was honest up front told them what I would be paying cash and what would be financed. Did my homework and new the MSRP and destination cost (that I didn’t pay for) so I knew going in where my negotiation would start. Long story short I was able to purchase for $21,500 asking price was $26K. Great information thanks for sharing!
Wow that quite some discount, what car/model? Use/new?
Wow that's a big discount.