I could use some CP advice re: buying a new car

[Weitz]

Do they get some sort of commission on financing or something?

My Financing is all done through Ford Canada for my ford, has nothing to do with the dealer.

[Canehdianman]

They usually get some sort of kickback on financing.

[steve9981]

nm

[Ragz]

Here is a question that I'm seeking an answer for;

Tax on trade in,
As a example
If you purchase a car for $50,000 and trade in a car for $20,000 you only pay tax on the difference for the new car = $30,000.

What happens when you have a trade in car that is worth more then the new car you want to purchase? For example I want to trade in my car and the dealership offered me $30,000 and the new car I want to buy is only $25,000? So is it just no taxes that has to be paid?

Originally Posted by http://www.autofocus.ca/how-to/used-guides/how-to-get-the-most-value-from-your-trade-in

Tax Savings

Dealers also allow you to take advantage of something called “tax savings.” This involves subtracting the value of your trade-in from the retail price of its replacement before any of the amounts are taxed. This effectively reduces the tax amount you need to pay on your new vehicle. For instance, if the car you want to buy costs $40,000 and your trade-in value is $25,000, then the taxable amount is the difference of those two numbers, which is $15,000.

[Canehdianman]

Not 100% sure I understand the question.... I think you would get the car and 30k in cash, presumably.

[Ironhorse]

I'm pretty sure the GST on the new vehicle is due on the full amount. Your trade-in value just subtracts from your final bill.

[accord1999]

Originally Posted by Ironhorse

I'm pretty sure the GST on the new vehicle is due on the full amount. Your trade-in value just subtracts from your final bill.

In almost all cases, you'll only need to pay sales tax on the net cost after trade-in. It's a primary benefit of trading in at a dealership.

[GreatWhiteEbola]

Originally Posted by accord1999

In almost all cases, you'll only need to pay sales tax on the net cost after trade-in. It's a primary benefit of trading in at a dealership.

This is correct.

[BigNumbers]

There is no refund - it relates to the net cost of the new car. Like most scenarios in life, no tax is the best scenario.

Also, it's worth noting that DEALERS WOULD RATHER YOU FINANCE THAN PAY CASH - CASH OFFERS NO LONGER GET YOU A BETTER DEAL, absent a delta in manufacture incentives, where often times the cash incentive (reduction to purchase price from manufacturer) is better than the discount for financing. Why do dealers prefer you finance? The dealers get a kickback payment form the lender if you finance, so they'd actually prefer you finance, as they pay the same to the manufacturer for the car regardless of cash or financing (before incentives)

However this lower financing incentive vs. a cash incentive is usually more than made up by the cheap financing that comes with it, 90% of the time. Ie:

Ford may offer $10,000 cash rebate on a new F150 as a fictitious example, or a $6,000 discount if you finance, but they are then also offering 0% for 5 years.

So while the cash discount will be $4,000 cheaper, on a $30K truck, assuming you don't have cash on hand, will cost you 6% to finance through a bank, so you are talking $1,800 a year in extra interest for 'paying cash' x 5 years = $9,000

So the actual discount for financing is the $6K from the manufacturer, plus the $9K in value of the 0% (or whatever the discounted finance rate is). So it's actually $5K cheaper to finance over the life of the car than to pay cash. This plays out in 90+% of the scenarios.

Even if you have cash - is it the best use of cash? I'd argue not. You can apply the above logic to this: Instead of paying $30K cash, you take the 0%. Then you buy CIBC stock, which pays a 5% dividend. You're still ahead over $4,000 after 5 years AND you now own a big 5 Cdn bank stock that's likely appreciated. Even if that stock went DOWN 12% (2% a year) or $4,000 you'd be break even with a cash deal. Conversely, if it went up 12%, now you're ahead $8K!!!!

TLDR; Check the manufacture incentives closely. 90+% of the time, in my experience, over a 4-5 year period, it is cheaper to finance than pay cash.

[cracher]

I think it's a good time to get a new vehicle. Dealers seem to be hurting a bit. Went to a couple recently to test drive. Without any carscostcanada printouts or anything, I was offered 6500 off MSRP plus loyalty incentive of 1000 at 1.5% lease rate. It looks like I can get the same vehicle, same trim I had in 2009 for over 4500 less without even haggling.

[Homeslice]

Small bump, just purchased a new 2017 vehicle.

First of all, big thanks to all of you who mentioned Unhaggle as it was my prime negotiating tactic and one that worked so, so well for me. Note, I am not a great negotiator by any measure, but I love a great deal and I was willing to go the extra distance to get what I wanted at a fair price.

I went to a dealership up North to get an initial quote after doing a lot of research on a mid-sized cross over SUV and was told, "this is by no means the final price and we will do what we can to get your business."

Great.

I went on Unhaggle right after and saw that the MRSP listed was almost $4,000 less than what the dealership listed! I know they can charge whatever they want but it wasn't even close. I just think about some poor sap walking in trying to get a good deal, but doesn't even realize how much the dealership is killing them. Remember, this is just the MSRP, not even including any rebates or discounts.

One of the best things included with your Unhaggle report in addition to giving you COST (price of what the dealer pays for the vehicle) is that there may be employee's that can help act as an unhaggle authorized Agent - basically someone at a dealership who can help negotiate the prices you're given on Unhaggle. After I got my Unhaggle report, an authorized agent called me, within 5 mins. I was expecting him to give me "the longest speech of my life" but the whole call literally took 5 mins. Without any ass-smoke-blowing, gave me all the numbers straight up. EVERY SINGLE ONE with a total price to the cent. I ended up paying less than that but that comes after.

I went back to the first dealership and told them the price, to which they emphatically said "take their offer, we can't beat that." I went to two other dealerships to get them to get the best price but in the end, the authorized Unhaggle agent was the best. I basically got COST + 2%, essentially the cost the dealer pays for the car, plus 2% dealer profit. The Unhaggle agent said that even though the Unhaggle report suggests negotiating with dealers between 3% to 7% above COST (which indeed it does), he wanted my business and 2% was good enough profit for him. He then started throwing in extras and shaving off that profit margin smaller and smaller when I told him I shopped around at the other dealers. In the end, based on his numbers he is making just enough to cover his salesman, plus about $100 profit; I'm naturally a sceptic, so I don't think what he said is actually true as I think he will get some sort of kick back from the car maker, but his reasoning was that they were a new dealership, with a new massive facility and they wanted my business for the CUV and for future service more than anyone else in the City. As a result, they were willing to eat the costs of a lot of things.

In the end, I paid about $3,000 less than the very first quote I got AND that includes a winter tire package, two extra years of extended warranty, exterior/interior/undercoating, 5 piece 3M protection, etc.

I hope my experience can help someone else out down the road as I have only bought one new car prior to this one. I wish I had someone show me Unhaggle prior to that, plus understanding how the process works. It literally saved me thousands.

[GreenLantern2814]

Originally Posted by Homeslice

Small bump, just purchased a new 2017 vehicle.

First of all, big thanks to all of you who mentioned Unhaggle as it was my prime negotiating tactic and one that worked so, so well for me. Note, I am not a great negotiator by any measure, but I love a great deal and I was willing to go the extra distance to get what I wanted at a fair price.

I went to a dealership up North to get an initial quote after doing a lot of research on a mid-sized cross over SUV and was told, "this is by no means the final price and we will do what we can to get your business."

Great.

I went on Unhaggle right after and saw that the MRSP listed was almost $4,000 less than what the dealership listed! I know they can charge whatever they want but it wasn't even close. I just think about some poor sap walking in trying to get a good deal, but doesn't even realize how much the dealership is killing them. Remember, this is just the MSRP, not even including any rebates or discounts.

One of the best things included with your Unhaggle report in addition to giving you COST (price of what the dealer pays for the vehicle) is that there may be employee's that can help act as an unhaggle authorized Agent - basically someone at a dealership who can help negotiate the prices you're given on Unhaggle. After I got my Unhaggle report, an authorized agent called me, within 5 mins. I was expecting him to give me "the longest speech of my life" but the whole call literally took 5 mins. Without any ass-smoke-blowing, gave me all the numbers straight up. EVERY SINGLE ONE with a total price to the cent. I ended up paying less than that but that comes after.

I went back to the first dealership and told them the price, to which they emphatically said "take their offer, we can't beat that." I went to two other dealerships to get them to get the best price but in the end, the authorized Unhaggle agent was the best. I basically got COST + 2%, essentially the cost the dealer pays for the car, plus 2% dealer profit. The Unhaggle agent said that even though the Unhaggle report suggests negotiating with dealers between 3% to 7% above COST (which indeed it does), he wanted my business and 2% was good enough profit for him. He then started throwing in extras and shaving off that profit margin smaller and smaller when I told him I shopped around at the other dealers. In the end, based on his numbers he is making just enough to cover his salesman, plus about $100 profit; I'm naturally a sceptic, so I don't think what he said is actually true as I think he will get some sort of kick back from the car maker, but his reasoning was that they were a new dealership, with a new massive facility and they wanted my business for the CUV and for future service more than anyone else in the City. As a result, they were willing to eat the costs of a lot of things.

In the end, I paid about $3,000 less than the very first quote I got AND that includes a winter tire package, two extra years of extended warranty, exterior/interior/undercoating, 5 piece 3M protection, etc.

I hope my experience can help someone else out down the road as I have only bought one new car prior to this one. I wish I had someone show me Unhaggle prior to that, plus understanding how the process works. It literally saved me thousands.

First of all, where did you go to find someone listing a car for $4000 over MSRP? On a mid size SUV? What did you buy, a Bentayga?

Second of all, you got exactly what you wanted on unhaggle and yet still didn't take that guy's help until you went to three separate car dealerships before going with that one? And even then, you still think you're being lied to. That everyone's getting rich off your one mid size CUV and laughing at the chump that is Home slice.

Your sales guy made $200 bucks on that car and hopes you never come back, btw. And if you didn't give them a 100% survey, may I suggest that you never buy a new vehicle again. You really seem like the worst kind of client.

If people wonder why the service from sales people seems a bit shoddy, this is why. Nobody's time is valuable except yours. Your sales person doesn't do a real job. He should work harder. He should sell 20 Cars a month at $200 per, and he should put in sixty hours a week for the privilege.

But sure, tell us about all the free stuff you got. 3M, warranty, winter tires and rims, plus undercoating??? AND $3K OFF? A regular Adlai Stevenson in our midst. Home slice calls lead on the next international trade deal, everyone.

For a guy who didn't want smoke blown up his ass, you sure went to a lot of trouble fitting bong in your sphincter.

Thanks for the update.

[Canehdianman]

Originally Posted by GreenLantern2814

First of all, where did you go to find someone listing a car for $4000 over MSRP? On a mid size SUV? What did you buy, a Bentayga?



Second of all, you got exactly what you wanted on unhaggle and yet still didn't take that guy's help until you went to three separate car dealerships before going with that one? And even then, you still think you're being lied to. That everyone's getting rich off your one mid size CUV and laughing at the chump that is Home slice.



Your sales guy made $200 bucks on that car and hopes you never come back, btw. And if you didn't give them a 100% survey, may I suggest that you never buy a new vehicle again. You really seem like the worst kind of client.



If people wonder why the service from sales people seems a bit shoddy, this is why. Nobody's time is valuable except yours. Your sales person doesn't do a real job. He should work harder. He should sell 20 Cars a month at $200 per, and he should put in sixty hours a week for the privilege.



But sure, tell us about all the free stuff you got. 3M, warranty, winter tires and rims, plus undercoating??? AND $3K OFF? A regular Adlai Stevenson in our midst. Home slice calls lead on the next international trade deal, everyone.



For a guy who didn't want smoke blown up his ass, you sure went to a lot of trouble fitting bong in your sphincter.



Thanks for the update.

Did we read different posts? His reads like a glowing referral to Unhaggle (albeit a little emphatic); yours reads like a car salesman who is pissed off at realizing that schmucks won't be overpaying by 4k on their cars anymore.

Based on your entitled attitude, it's no wonder most people can't wait until the dealership model is dead.

[PepsiFree]

Originally Posted by GreenLantern2814

Thanks for the update.

Thanks for showing us your true colours.

RE: Unhaggle dude
Glad you got a great deal you're happy with! I think that's the most important part, that you're happy with the price and happy with the additions. I considered Unhaggle, but will definitely keep it in mind after that review!

Great work shopping around.

[GreenLantern2814]

Originally Posted by Canehdianman

Did we read different posts? His reads like a glowing referral to Unhaggle (albeit a little emphatic); yours reads like a car salesman who is pissed off at realizing that schmucks won't be overpaying by 4k on their cars anymore.

Based on your entitled attitude, it's no wonder most people can't wait until the dealership model is dead.

Unhaggle did a great job for him. So great he shopped the Unhaggle guy at two additional dealerships.

Negotiate on a car, whatever. Don't waste people's time, and don't be greedy. Every car cost or unhaggle type site will tell you (and this is admitted by the poster) that a fair price is anywhere between 3-7%.

I'm not a salesman, thank Christ. It's an awful, thankless job. I do know there's a lot more work to do as a salesperson besides getting someone to sign on the line which is dotted. But if the journalists who safeguard democracy don't deserve to get paid a real wage because bloggers can do a better job (which they can't), why would anyone expect someone selling cars deserves money - It's not like they're providing a service.

To conclude, I hate this industry so much.

[NuclearFart]

Originally Posted by GreenLantern2814

First of all, where did you go to find someone listing a car for $4000 over MSRP? On a mid size SUV? What did you buy, a Bentayga?

Second of all, you got exactly what you wanted on unhaggle and yet still didn't take that guy's help until you went to three separate car dealerships before going with that one? And even then, you still think you're being lied to. That everyone's getting rich off your one mid size CUV and laughing at the chump that is Home slice.

Your sales guy made $200 bucks on that car and hopes you never come back, btw. And if you didn't give them a 100% survey, may I suggest that you never buy a new vehicle again. You really seem like the worst kind of client.

If people wonder why the service from sales people seems a bit shoddy, this is why. Nobody's time is valuable except yours. Your sales person doesn't do a real job. He should work harder. He should sell 20 Cars a month at $200 per, and he should put in sixty hours a week for the privilege.

But sure, tell us about all the free stuff you got. 3M, warranty, winter tires and rims, plus undercoating??? AND $3K OFF? A regular Adlai Stevenson in our midst. Home slice calls lead on the next international trade deal, everyone.

For a guy who didn't want smoke blown up his ass, you sure went to a lot of trouble fitting bong in your sphincter.

Thanks for the update.

wow bitter? Your post certainly isn't doing much to dispel the negative perception of a salesmen. His post isn't why "service from sales people seems a bit shoddy", it's because of your post exemplifying the sense of entitlement a lot of car salesmen seem to hold.

You act like you've never shopped around for a TV/house/car/etc. Either you're a total hypocrite or a naive consumer.

[Royle9]

Originally Posted by GreenLantern2814

First of all, where did you go to find someone listing a car for $4000 over MSRP? On a mid size SUV? What did you buy, a Bentayga?

Second of all, you got exactly what you wanted on unhaggle and yet still didn't take that guy's help until you went to three separate car dealerships before going with that one? And even then, you still think you're being lied to. That everyone's getting rich off your one mid size CUV and laughing at the chump that is Home slice.

Your sales guy made $200 bucks on that car and hopes you never come back, btw. And if you didn't give them a 100% survey, may I suggest that you never buy a new vehicle again. You really seem like the worst kind of client.

If people wonder why the service from sales people seems a bit shoddy, this is why. Nobody's time is valuable except yours. Your sales person doesn't do a real job. He should work harder. He should sell 20 Cars a month at $200 per, and he should put in sixty hours a week for the privilege.

But sure, tell us about all the free stuff you got. 3M, warranty, winter tires and rims, plus undercoating??? AND $3K OFF? A regular Adlai Stevenson in our midst. Home slice calls lead on the next international trade deal, everyone.

For a guy who didn't want smoke blown up his ass, you sure went to a lot of trouble fitting bong in your sphincter.

Thanks for the update.

My god you cant be serious, the salt runs deep in this one.

[GreenLantern2814]

Originally Posted by NuclearFart

wow bitter? Your post certainly isn't doing much to dispel the negative perception of a salesmen. His post isn't why "service from sales people seems a bit shoddy", it's because of your post exemplifying the sense of entitlement a lot of car salesmen seem to hold.

You act like you've never shopped around for a TV/house/car/etc. Either you're a total hypocrite or a naive consumer.

I've never shopped around for a car before and I'll tell you why: I respect the time of the person I'm dealing with. If I walk into a store and I'm interested in a Rav4 hybrid, I'll ask questions. I'll go for a drive. If I like the car, if the person I'm dealing with isn't off putting and if there's an offer on the table that I consider fair based on my budget, I'll buy the car.

I won't then go to three other Toyota stores to save a couple hundred bucks over the course of a seven year finance term at 0%.

In fact, I don't shop around for anything, now I think about it. If I don't buy something, it's because I can't afford it or I'm not sold on it. Which I think is pretty reasonable. Not entitled.

[Oling_Roachinen]

Originally Posted by GreenLantern2814

Unhaggle did a great job for him. So great he shopped the Unhaggle guy at two additional dealerships.

So? Jesus Christ, it's a new vehicle. Probably going to be one of the largest purchases he made and he checked with a couple other dealerships. Big deal.

[FlamesAddiction]

I played with idea of buying a new car a few years ago. I went to a Honda dealership and got to the point where I thought I could haggle and the salesman became really indignant and said that Honda doesn't haggle. The price he gives is the final price.

I'm not sure if he was bluffing or not, but I got up and left. I thought haggling when buying a car was normal, but he made it sound like it wasn't.