Question-------------------------
Followup To
Question -
-------------------------
Followup To
Question -
Hello,
I live in Needham, MA 02494 and am looking to maybe buy a new car. I have a 2002 Sebring Convertible that has 35000 miles on it and I have had problems with the rear defroster that I have had fixed 6 times from 2 different dealerships. I'm a little frustrated by now...
I'm considering buying a new 4 cylinder Honda or Toyota considering I will have a 35 mile commute each way starting next month, plus I'm frustrated with my current car. I saw a 2004 Toyota Camry Solora tonight with a sticker of 21,800 that they said they would sell for 20,400 before I even said anything. Also, Toyota has $500 rebate or 0% for 36 months financing. A friend said she saw an article that said 0% financing may not be that great a deal since they won't go as low on price, do you know if that's true? Also, if I were to buy this car, what negotiated price do you think would make it a good deal? A man I know who used to sell cars said so long as you get 10-14% off sticker then you are doing well, is that true? Should I put any money down if I do 0% financing? They said they would give me a great trade in price since they also have a Chrysler dealership. Thanks for any advice, Kevin.
Answer -
All excellent questions Kevin. First I would suggest you go to edmuncs.com and get a price on both the car you are buying and the car you are trading in. Never, Never, Never discuss financing until you have arrived at a mutually satisfactory price. Honda or Toyota will be an excellent choice, either one. The amount you have to pay down will depend entirely on your credit record and what you owe on your current vehicle. As to 0%/36 mo.s or $500 rebate you need to do the math. If you borrow 18000 for 36 mo.s at @ your interest would be 0. If you financed it at a normal rate of 6%APR your interest would be approximately $1,620 so the 0% would be the best deal. You just have to look at all the figures and figure what is best for you. Best of luck and let me know if you have specific questions. Bud
Hey, thanks Bud! Got a follow up question.. I also started looking at Honda Accords, and a large local dealership has a couple 2004 Accord EX V-6 models with an MSRP of $26990 in a color that I like. The internet sales director replied to my email with a clearance price of $22599, which is $4391 off (just over 16% off). This sounds like a really good deal, do you agree? I could actually pay cash for it at the moment so I wouldn't be that concerned with finance rates.
Answer -
Kevin, this sounds like a fair deal to me and paying all cash sounds even better. Back when I used to be in the teaching business we always tried to tell people to buy depreciating assets the quickest way possible and never to pay interest unless there were tax advantages. Another thing about the Accord is that it has an excellent repair record as well as great resale value. Best of Luck, Bud
Hi Bud,
Took your advice and today I bought a car! Here's how I made out, I ended up working through 3 Honda dealerships, contacting them all via the internet within the past couple days. All of them had 2004 Honda Accord EX V-6 models selling for $26990. Here's how it went:
1. Made an internet low offer of $19000 at a dealership #1 (not expecting them to accept, just way low knowing they wouldn't go lower), a BIG dealership in the Boston area. They replied to my email with an offer of $22599 (I already told you this).
2. Dealership #2 that I had emailed called me this morning and told me they would sell the same car for $24990 ($2000 off MSRP). I told them that another dealership had more than doubled that discount. The woman said, "Okay, how about $22343?". Now, that's $4647 off MSRP (over 17%), a better deal than the first one.
3. I then visited dealership #3 who had replied to my email. They offered me a high trade in value ($12,500) but wouldn't go lower than $23,100 on price, a $10,600 difference. I negotiated a good while before they went that low and said unless they match the $22,343 price from dealership #2 then it was no sale. I ended up leaving there saying I would be in touch if I decided to buy from them.
4. I went to dealership #2 that had offered me the $22,343 price. They offered me a trade in of $10,200, I then told them dealerhip #3 offered me $12,500 trade in. I spent a LONG while at this dealership (almost leaving twice) and eventually got them to sell it to me for $22,343 with a trade in price of $12,343, for a difference of $10,000, which was $600 less than dealership #2.
The Kelley Blue Book price for my car was $13000 in excellent condition and $12155 in good condition. Besides tax on the $10000 difference (which is legit in this state) the only other thing I paid for was $214 for registration, inspection, paperwork, etc. The dealership I bought it from said they needed my car on Monday because they knew a wholesaler that wanted to buy my trade in and thats the only reason they went that high.
Thanks for all your advice, you've been a big help!
Kevin
ridetoday@comcast.net
AnswerCongratulations on an excellent job of shopping Kevin..Too bad more people are unable or not willing to go the the length you did but you were rewarded with a fair price. You ought to print this whole sequence of questions and answers and the results and send it to the business section of you local paper. I think they would like it. In any case good driving and the best of luck. Bud
