7 Simple Tips to Get the Best Deal on a New Car

When you shop for new cars, you're shopping for new car deals. The best car deals go to anyone who knows how the process works. 

Take a look at the 7 tips we've compiled to show you how to get the best deal possible on your next new car, and make sure you're covered with an affordable car insurance policy.

1. Don't Give Up Your Best Leverage

You have a trump card that you can use at any point: You can walk out. 

The best way to make this work to your advantage is to do a little preshopping and get competitive price offers from a few local dealers. If negotiations with one dealer turn sour, you can walk out and move on to the next.

Chances are you won't make it out the door before the dealer calls you back to the table with a better offer. This won't always happen, but sometimes it does. 

2. Focus on Invoice Price

The invoice price is the price the dealer pays to the manufacturer to get the car. However, this isn't always the bottom line price for the dealer. Note that: 

• The dealer may have paid more or less than the invoice price. 
• The dealer can get holdback payments (not included in the invoice price) from the manufacturer after the car sells.

Your best bet for the best new car deal is to ask local dealers to bid based on invoice price. For example, a dealer might bid $500 above invoice if the car is desirable, but not too desirable. Or maybe, a dealer would bid $1,000 below invoice if that particular model has been on the lot for some time and hasn't sold. 

Never start with the sticker price (MSRP) in negotiations. Work up from the invoice price.

3. Get Your Own Financing

Your bank or credit union can often offer you better service and rates than your local auto dealer. 

Having a financing offer in hand when you walk in gives the dealer one less way to increase the cost of the deal. But this doesn't mean you should skip what the dealer's financing office has to offer. 

In some cases, especially if you have great credit, you may get 1% or lower dealer financing during promotional events. Just make sure the dealer's loan offer is better than the one you could get at a trustworthy financial institution. Sometimes, the best deals come from the least likely places when you're shopping for a new car.

Never rule anything out completely before you investigate all of your options.

4. Keep Those Numbers Separate

You can negotiate the:

• Price of the car
• Terms of your loan 
• Value of your trade-in 

If you let a dealer roll these into either a monthly or total price, you're probably going to overpay. You can avoid this by focusing on each number separately. 

Here are some simple steps to follow:

1. First, agree on a price for the car.
2. Next, agree on the value of the trade-in based on online price listings.
3. Third, agree on the terms of the loan, if any. 

Keep any rebates or incentives separate from the overall price you're negotiating. You can always tack them on at the end. 

Rule of thumb: Never tell a dealer your monthly budget.

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5. Selling Is Better than Trading In

Most dealers will offer you a similar trade-in price for your car. The trade-in price is the average price dealers in your area pay for similar cars. It is almost always less than what you could get for your car if you sold it yourself. 

If you do plan to trade in your old car, make sure you receive a fair price for it from the dealer. If the dealer rolls it in quietly, like a discount on the overall price of your new car, you may not be getting a fair shake. Definitely take into account that the best new car deal might be a product of the best trade-in or selling price of your old car.

6. Shop Midweek, Not on Nights or Weekends

The middle of the workweek is the least busy time for car dealers. This is because:

• You'll probably be the only potential buyer on the lot.
• You'll get more attention. 
• It's more important for the dealer to make a sale to you when there aren't lots of other potential buyers.

Shopping midweek might seem like a pain, but it's worth it for your bottom line.

7. Don't Allow Tacked-On Fees To Sour Your Best Car Deals

Once you've negotiated a deal, there are other costs to keep in mind. There are:

• Documentation fees (sales taxes, title and vehicle registration fees required by your state/local government [and payable to them, not the dealership])
• Delivery costs
• Advertising fees (but these should never be your problem!) 

If you're getting charged for advertising fees, speak up and refuse to pay them. 

A Note on Registration and Insurance...

You can get a deal on this, too.

When you finance the purchase of your car, your lender will typically require you to carry a certain level of comprehensive and/or collision insurance for the life of the loan. Your state will always require some sort of investment in liability insurance - whether you pay a fee up front, or get an actual liability policy with certain policy limits for bodily injury and property damage. 

Independent agents can help you save on auto coverage by comparison shopping with multiple carriers, instead of a single insurance company like a captive agent. Our agents are independent and ready to help make this process quick and painless for you and to help you save.

There Is No Best Time of Year for the Best Car Deals, So Get Shopping

Offers and discounts change constantly throughout the year. However, the end of the month and quarter both tend to be better than the beginning of either. The reason? Dealers look toward new inventory and new fiscal seasons. 

The best practice is to find invoice prices on the model you like best, and then see what local dealers in your area are willing to offer. If you can get a great price at a small markup over invoice, along with a hefty rebate from the manufacturer, that's probably one of the best new car deals you'll find.