I met Scott Forrest at a friend's party here in Los Angeles, and we got to talking cars. Turns out, Forrest loves cars -- almost as much as he loves getting a great deal. He's combined those two passions into a company, UnderBlueBook, that specializes in helping people get the best possible deal on any car, new or used.
Since Forrest has made it his mission to understand the car sales industry from the inside out -- who's allowed to buy what inventory, what the banks actually do with lease returns, how to get the lowest price for anything from tires to transmissions -- we asked him to lay down some professional knowledge on how best to navigate the car-buying process and walk away with a better deal than you thought possible.
Exhaust Notes: If you had to narrow your car-buying advice to five points, what would they be?
My first rule of negotiating is, "He who speaks first, loses."
Most people talk too much and dealers love it! I don't care if you can drive a Mack truck through the pauses in the conversation – shut up! Make them work to convince you.
Secondly – and even if you’ve heard this countless times before, another time will probably help – never, never, never get emotionally involved. There are hundreds of thousands of opportunities to buy in this country. If you are serious about getting the best deal, you have to feel totally free to walk away at any time during the buying process.
Third, never walk into a dealership alone once you are ready to buy. Separation anxiety is a big ol’ tool used in car sales, and along with the whole good cop/bad cop routine it works brilliantly to help them gain control of the negotiating process. Beat them at their own game; treat the whole thing as if you’re going in to interrogate them instead.
To make it work, choose who’s going to play the good cop and who’s better as the bad cop. They won’t know what hit them -- and if they do catch on, they’ll respect the effort and back down anyway. Just remember to have fun with it. Sales is a game.
Fourth, when you’re buying a used car, don’t be afraid to get your hands dirty. Here are some tips:
Oil: Unscrew the oil cap and inspect the underside. If it shows corrosion or burned-on oil, it usually means the engine has been driven hard and raced. Anyone can change the oil before you view it, but they rarely think about changing the oil cap so you won't detect what’s really been going on.
Tires: When checking tread, dig you fingers deep inside. Feel how much tread each tire has on it. A lot of time, dealers and private-party sellers will shine up the tire walls in hopes that you won’t check further, but don't be afraid about breaking a nail. Dig 'em in there.
I love this next tip, and no one ever sees it coming: Run your fingers along the edge of the hood before it meets the windshield. If it feels really smooth, like a high gloss, we call that “factory smooth” and it most likely means the hood has not been replaced and/or repainted. If it feels rough, or not so smooth, then the hood most likely has had work done. It’s the one place on the car that rarely gets buffed – the body shops usually don’t take the trouble. One loving swipe with your two index fingers along that edge speaks volumes.
Last, never enter a deal when you are hungry, tired or emotional. This applies to anger, as well. Most people try to cram too much into one day. When you are buying a car start early in the day and remember to get away from it and go have lunch. They want your business. They’ll be there when you get back.
EN: Given the current economic climate, are there certain factors within the industry that a potential car buyer could exploit?
This is a great time to buy, with dealers offering amazing programs to get you in the door. These deals are real for people with great credit – ahh, there's the rub. Pay attention to the small print before you get to the lot. Check online and call ahead to speak with the fleet manager or Internet department to clear most of the questions you have before you arrive. Be prepared.
Cash is always king. You hold all the marbles when you have cash in hand. A FICO score above 740 usually reduces their negotiating room to zippo. If your credit score is less than 740, this is where the down payment makes a difference. On a new car (depending on the car, of course) putting $5,000 down lets them know you are serious. Don't expect the dealer to move mountains for you if you are walking in with $1,000 down. The dealer wants to prove to the bank your commitment to the vehicle.
EN: What are some of the standard car-selling industry tactics of which a car buyer should be aware?