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Does paying cash at a dealership really get you a better price ?

Annisman*

Annisman*

Golden Member
I am looking at buying a car in the 8-12 thousand dollar range, used of course.

I keep hearing that you can get a better deal if you pay cash, is this true ?

For example, if there is a car there for 12 grand and I come in with cash (a check) should I be able to talk them down to 10 grand? How much could I talk them down ? Or is the cash thing not true ?

Thanks 😀
 
the cash thing is generally not true.

The dealer most likely gets a kick back on selling financing. some rebates require financing. So you might be better off financing the car for a few months and then paying it off.
 
I do the negotiating up front and then discuss financing/payment after we come to an agreement on price. I wouldn't step foot in a dealer without financing already arranged on my end. If they can beat it fine. If not, no big deal.
 
Ok, so besides the cash part, what kind of price do you think you could negotiate on a 12k$ vehicle ? Is it generally understood that you can bargain the price down a little or do you usually just pay what they are asking ?
 
Annisman* said:
Ok, so besides the cash part, what kind of price do you think you could negotiate on a 12k$ vehicle ? Is it generally understood that you can bargain the price down a little or do you usually just pay what they are asking ?
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IIRC I negotiated just under 8% off the last (dealer purchased) used car I bought. I generally go private party, though. It also depends on the dealer - I bought one that was very aggressively priced (my 36k mile 2005 Tundra SR5 4x4 x-cab only cost me $15,995 in 2008) and they wouldn't negotiate at all.
 
What would you say the benefits of buying private party vs dealership ? If we're talking a 5 or 6 year old vehicle that wouldn't get a warranty from the dealer anyways ?
 
Annisman* said:
What would you say the benefits of buying private party vs dealership ? If we're talking a 5 or 6 year old vehicle that wouldn't get a warranty from the dealer anyways ?
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No sales tax (in Arizona specifically) is huge. Also, prices are generally lower.
 
Maybe at a used car lot, but not with most new car dealers. Most informed buyers go in and negotiate the price first and then discuss payment options/trade. The best thing you can do is find a respectable message board that represents the car you are interested in and see what others have paid. They usually have threads discussing their OTD prices. That is where I started.
 
For me, it always depends on options. When buying new, you likely have the same number of options as there are dealers of that brand in your area.

When looking at a 10-12k dollar used car, it usually winds up being more in the area of who has the car I like in the condition I want it in. The most important being condition. Wife and I looked for her 08 Tribeca, and instantly loved the first one we looked at. Dealer didn't seem much willing to haggle. We checked out a similarly priced one at a close by dealer and it was in VERY rough shape and had far fewer features. We pretty much hated it before we drove it anywhere. We promptly bought the other one as the options of finding that vehicle were very slim, and it was what we wanted.

Similar thing with my purchase. I test drove one that was light blue, and I simply really did not care for the color. I found a dark blue one I was sure I would like, but it sold before I got there. They happened to have a white one as well, and it was in great shape. The haggled about $1000 off the price, but that was pretty much all they would do and I didn't push for anything more.

So while there is likely more room to wiggle on a used car, just know that your options are usually far more limited so it's probably best to buy the car that is in the best shape of all of your options.
 
Annisman* said:
Ok, so besides the cash part, what kind of price do you think you could negotiate on a 12k$ vehicle ? Is it generally understood that you can bargain the price down a little or do you usually just pay what they are asking ?
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Totally depends on what said vehicle is actually worth. There is no magic percentage or number.

I paid the dealer asking price for my used truck I bought in May. Why? Because they didn't start off high like most dealers and actually priced it where it should be in the first place. Frankly it made the whole thing so much easier and less hassle not having to play the dumb pricing games.
 
I'd say it depends a lot on who you encounter.
If you actually bring in bills, put down the amount you're willing to pay, and put the vendor into a "take it or leave it" situation, your bargaining potential may increase by giving a visual representation of what the seller is going to miss by not agreeing. It also shows him that you're a serious buyer, further making him feel uneasy about letting go on a deal, that might otherwise have worked.

So, if you can make use of the psychological advantage, and are willing to walk out with no deal if your price isn't met, bringing cash to the table may well result in a better deal.
You can pretty much forget about that when buying something off the list, instead of off the lot.
 
Salesguys might only get $100 to $400 for the deal. They don't really care if you walk out if they're a decently busy dealership. And as others have said, they often get extra if they steer people into the financing. So in fact, your cash being waved around just makes you less than idea of a customer to deal with and they might not really bend over backwards to help you, at all. Storming into the dealership all bossy and putting cash on the table and making lowball offers might have worked in our grandfather's day, but not today.
 
Cash would only make a difference to a private party IMO. It's the visual, For example. "I know you are asking $5500 but here is $4500 cash, take it or leave it." Maybe they had a bottom line of $5k, but seeing that cash is hard to pass up. Dealers aren't going to give in like that.
 
Riverhound777 said:
Cash would only make a difference to a private party IMO. It's the visual, For example. "I know you are asking $5500 but here is $4500 cash, take it or leave it." Maybe they had a bottom line of $5k, but seeing that cash is hard to pass up. Dealers aren't going to give in like that.
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Agree with this.

Also, its much easier to take the cash vs. waiting for the customer to get financing and then issue you a check. This is great for cars in the ~$7000 or less range. You probably will not have someone bring $25k with them for a car purchase based on a CL listing...🙂
 
At the end of the day they don't care if it is cash or finance, as long as you're buying the car.

Cash might help you sound more like a sure thing if they can find a car in your price range, but I don't think it will help your negotiated price "bottom line".
 
People tend to under value their cars as well.
Because they know all the blemishes they often feel they are asking too much.
One guy tried to talk me down on a car and I told him. Its a used car its not perfect and that's reflected in the fair price.
One guy actually gave me asking price on a snowmobile but I cut him a break and told him to offer lower next time he deals on something and lowered my price by a couple hundred.
 
michal1980 said:
the cash thing is generally not true.

The dealer most likely gets a kick back on selling financing. some rebates require financing. So you might be better off financing the car for a few months and then paying it off.
Click to expand...

JulesMaximus said:
I do the negotiating up front and then discuss financing/payment after we come to an agreement on price. I wouldn't step foot in a dealer without financing already arranged on my end. If they can beat it fine. If not, no big deal.
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Depends. If you have your own financing lined up, that's as good as cash to some dealers but in general no. Dealers have a price they need to get for a car. If they don't get that price, they will typically wait for another buyer.
 
jlee said:
No sales tax (in Arizona specifically) is huge. Also, prices are generally lower.
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Prices are usually way lower. A $10,000 car at a dealership is closer to $7,000 through private party. On top of that, dealerships frequently screw you over by lying about the problems a car will have. The guys who work there are trained/professional liars. People who sell the car themselves suck at lying in comparison to people who do it all day/everyday and need to do it to provide themselves a living. :/

I don't even consider dealerships unless I'm thinking of buying new. I would never buy used through a dealership.

Oh, and cash isn't better. Some dealerships make extra $$$ through loans.
 
TridenT said:
Prices are usually way lower. A $10,000 car at a dealership is closer to $7,000 through private party. On top of that, dealerships frequently screw you over by lying about the problems a car will have. The guys who work there are trained/professional liars. People who sell the car themselves suck at lying in comparison to people who do it all day/everyday and need to do it to provide themselves a living. :/

I don't even consider dealerships unless I'm thinking of buying new. I would never buy used through a dealership.

Oh, and cash isn't better. Some dealerships make extra $$$ through loans.
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Ask for out the door for cash.
Pretend to balk at the number.
Then see what the dealer is offering as an out the door price with financing.

If you can cover the cost and financing is less; take the financing offer.
Pay off the finance immediately.

15 years ago; Dodge was offering $5K off their trucks if they were financed through Chrysler.
Took the deal; then sent in the full amount of the loan the day I received the coupon book.
 
Paying cash will help you get out of the hidden dealer fees, because if the dealer doesn't mention them before you show up and then you show up with a check for the exact agreed upon price, they will never let you walk over the $200 "processing fee."
 
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