Definitely don't tell your car salesman you're paying with cash. I prefer to buy cars outright and the salesman will negotiate the price of the car because the interest rates aren't very flexible. They would rather you finance the car than pay cash so they will not negotiate to the lowest price for a cash sale. They will keep lowering the price in order to present you with a really nice low monthly payment. Last time I bought a car, at the end of the negotiation I simply told the salesman that I spoke to my husband and he'd rather I just write a check for the car. He couldn't really add the 5000.00 back on at that point.
This also works if you bring your won fianncing. My brother didn't have cash for his last truck, but got financing from another bank where he was approved up to a certain amount so he could write the check up to that amount. At the end of his negotiations he told the salesman their rates weren't very competitive and would use his outside financing. He saved big also. Of course, the outside financing was appealing at 1.9%.
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