I bought a car and how I did it!

I never realized how stressful buying a car could be, and I'm so glad it's over! I wanted to share my experience for other ladies out there who are interested in buying a used car. 

First, I researched the car I wanted which was a Mazda 3 hatchback. I didn't want anything older than a 2012 (I liked the body shape for that year and up). Next, I checked on Kelley Blue Book to see what they usually go for. I also went to different dealerships (online and in-person) to get pricing. Another thing I did was talk which was key to my success. I let everyone know I was interested in buying a car, friends, coworkers, strangers, and family. I solicited advise from a lot of my friends and it so happened that one of my friends works with insurance companies. He was able to get me original pricing that the insurance companies would pay for the car. I just needed to supply him with the vin number. With that price in mind, it gave me more power to negotiate. 

It took me more than a month to look, but when you're buying something of such high value that will hopefully be with you for the long run, its beneficial to stay patient. You want to feel good about the price and the product. That's what I kept telling myself every time I left a dealership. This process should not be rushed.

Now lets talk about the dealership. The least favorite part of this process for me. I've met really nice dealers but the bottom line is they want to make money from you. So keep that in mind. I knew how to negotiate small things that average a couple bucks or even hundreds in savings. But this would be a couple thousands or more which I was a complete novice to. Negotiating is not always easy because for me in the past I would feel bad for my imposition. I know some women can relate but honestly, we just need to get over it and in this moment we have to be selfish. It's our hard earned money we're exchanging for value. It should be reasonable and make you feel good coming out of it. Plus, you'll be proud of yourself. 

Before I went to the dealerships, I researched how to negotiate. We are so blessed with a wealth of resources. I literally Googled "How to negotiate buying a car". I came across a couple websites with great advise. Like do not offer a price first, let the dealer offer up a price. Another one was, if the dealer starts talking monthly payments before offering a price, tell them you're not ready to discuss that until you have a bottom number. Do your research. It's available to you and it behooves you to study before stepping into a dealership. 

Several months prior, I went to a dealership to test drive and "negotiate". My intentions weren't to buy a car at that time but more so to practice. Here's another thing I learned, dealerships are required to ask their manager a total of 3 times to lower the price. If you think you're getting a good deal the first time around, go ahead and ask for a lower price again. That's exactly what happened this day I went to harness my negotiating skills. He literally went back 3 times to lower the price I requested, and they honored it each time. After the third time, they no longer negotiated with me, and I walked out. Again, I wasn't planning on buying that day. Of course there's an exchange of numbers and the dealership, as predicted, called me right after. I probably could've negotiated more. 

Another thing you need to know is that not only can you negotiate the price of the car but you can also negotiate the finance rate of your loan. I had no clue! And the better your credit is and down payment the better leverage you have. But don't let your credit discourage you if it's not that great because you can still negotiate it to a better rate for you. I had no idea this was something that was negotiable. I always thought whatever you were approved for is what you're stuck with. So false!

Remember, I said I talked to a lot of people about my interest in buying a car? One day after work, I wanted to check out a car so I got a Lyft car. When I was in the Lyft car, I was just so tired of negotiating prices. I talked to the Lyft driver about my experience and how I've been going at it alone. He asked if I needed his help. He actually use to buy auction cars and sell them. Let alone, buy plenty of cars for himself. Of course I accepted his invitation to help me out. There's no shame in needing help especially if someone is kind enough to offer it. He's the one who also assisted me in negotiating my finance rate which I had no clue I could do. We were able to drop my rate by 3 points! 

I must warn you, prior to me going to the dealership, I would receive offers from my bank regarding car loans. I applied before even finding a car. I wanted to get the loan process started. In minutes, I was approved and was emailed a certificate. I waited a week to go back and get the car I looked at w/ the Lyft driver. I told the dealership I was pre-approved with my bank. I showed the certificate of approval, and they took it back to their finance department. Within minutes they came out with their bank offer and said my loan wasn't valid because it was only for certain dealerships not including theirs. Bummer I thought. Thankfully my Lyft driver said, "No, no, no. Go back and get her a better rate if you can't accept her loan." In my head, I was thinking "what the hell is he doing?" They just said they couldn't accept my loan and they're kind enough to find another bank I could use. I didn't get it. But the dealer went back and minutes later, came back with 3 more options plus my bank with lower rates. I was so confused. I remember thinking just minutes ago they told me, they couldn't use my pre-approved loan.

The negotiation process was pretty lengthy, and we sent the dealer back three more times until I felt good about my rate. I even called my bank to discuss the rate the dealer just offered me. My bank informed me I could get a lower finance rate just by lowering my repayment contract from 72 to 60 months which the dealership told me wasn't an option! I'm glad I made that call in front of them. If they already lied to me about not being able to use my bank loan, I was sure they lied about other details. We even had them repair some dings on the car before I came back to pick it up. All in all, I'm very happy about my purchase and the fact that I didn't go in there blindly. I have an enormous amount of gratitude for my Lyft driver, Gerard. Without him, I would've gotten ripped off with my finance rate. 

But the universe always has my back and prior to meeting Gerard, I had a little talk with the universe about how I was tired of negotiating alone and how nice support would be. Then I let that little thought go. The next thing you know, seconds before entering the dealership, Gerard offered his assistance and expertise. I am so very thankful!! I thought the treatment I was getting at dealerships was because I was a woman but when I saw the interaction between Gerard and the dealer, I am able to say, "Nope, it's not because I'm a woman. Dealerships hustle everyone." 

Here's another tip when negotiating: When you try to discuss pricing, be sure to determine if what you and the dealer are negotiating is either out the door (OTD) pricing or pricing pre-tax and other fees. If they say OTD, this means your bottom line number which is supposed to include taxes and fees like registration, smog, license, etc. I usually negotiate the OTD because it's just easier to remember and keep consistent. However, you may not always be able to do this. But try.

That was the first mistake I made going into a car dealership for the first time by myself. Actually, it was an auto broker (which I highly suggest people use) I visited for my first time. It's less intimidating. I had to get my feet wet. When I test drove the car, the dealer and I got to know one another. He's from the Middle East and a graduate of UC Santa Cruz. His brother, a graduate of UC Berkeley. He took over his dad's business after working in the Financial District. He told me that although there are two graduates in the family, he makes just enough to take care of the family. Ugh, why did he say that? When you negotiate, you need to remove all emotional factors. So I had a quick thought of sending him and his family some love and light and removed my sentimental motherly side from it. I too had a story, caring for my three girls on one income. So who wins? We both do.

Auto brokers have less inventory than dealerships. They turn over inventory quickly. They offer cars at better prices too. He was doing well for a young man, I can tell. He was smart and had great professional knowledge in his industry. I didn't need to feel bad for him and he knows that. My point is, when we negotiate do not feel sorry for these dealers, no matter what they say. If you do, than it's too late you already lost your negotiating power. I was still able to negotiate with him even though he didn't want to budge. I usually just start with, "What's the best you can do for me? I want to feel good about this transaction." They should understand because they too want to feel the same way. You don't want to low ball them because that's disrespecting their knowledge in the profession. If the roles were reversed, you wouldn't want them to disrespect you after all your research on a car. 

This dealer agreed to take off several hundreds. I was ecstatic because I also read Yelp reviews before hand to learn his negotiating style and knew going in, most of the reviews didn't get discounts. If they did, it was also only for several hundreds. See ladies...do your homework. It can really save time and stress. I thought the hard part was over. I was done, and we just negotiated OTD. But we weren't! He said, "Okay, now let me calculate how much tax and fees will cost." What?! I thought we just negotiated the final price, that it was OTD. Nope, he said a lot of people make that mistake. I asked myself how can I get this lower? So when he gave me the final price which was something like $11,628, I asked him if he could make it an even number. An even number meaning just a clean number like $11,500. That was my last chance to negotiate and he honored it. However, I had to walk away because I needed to get keys which were another $300 that he failed to tell me about until the end. He sold the car the next day. But I don't regret it at all. 

Other items to look at when negotiating a used car:

-How many miles? The lower the mile the more value the car is worth depending on the year. My car is 2012 with 19k miles. That's an average of about 5k miles driven per year. Average miles per year for "normal" driving is 10-12k. 
-How many owners? Again, the less owners, the more value. When you have too many hands touching one car, there's more risk of wear and tear and damage to the car.
-Is the title clean or salvage? If salvage title, the value can be about 30% less than a clean title.
-Always get the CarFax from dealership. You shouldn't be the one to buy it. Unless, it's a private sale.
-Dealerships should also allow you to take your car in and get it checked by a mechanic. My mechanic charges around $100 but since I have a cool relationship with him he charges me $50. Your mechanic work is also negotiable.