Buying a Car: Sealing the Deal

new car

Today is Part 6 of my series on buying a car. You can follow the entire series here:
-Part 1: Setting a budget and a timeline
-Part 2: Should you pay cash or get a loan?
-Part 3: Picking a car that fits your needs
-Part 4: Negotiating with the dealers
-Part 5: Test drive like a pro
-Part 6: Sealing the deal

Welcome to the final installment of my series on buying a car. By now you should have the perfect car pretty much picked out and you should be ready to make a deal. Because you used my email negotiation techniques, you’ve already got a great price in hand, but there’s still some room to get it even lower. Beyond that, there are a few other details to handle before everything is complete and you’re driving away in your new car. Today we’ll go over those last points so you can make your final decision as smooth and successful as possible.

Ask the dealer to fix any defects

Before you sign any papers, ask the dealer to fix anything that you’re not comfortable driving away with. This could be as simple as a tire rebalance or changing the oil, or it could be bigger like replacing brake pads or fixing a dent. If there’s something wrong with the car, you need to ask the dealer to handle it. Either they’ll do it willingly (this was my experience), or they’ll balk at the request and you can either look elsewhere or use those defects as part of your final negotiation.

But I can’t stress this enough: if they say they’re going to fix something, make them do it before you sign anything. Once you’ve signed the papers, they really have very little incentive to get anything done. As an example from my own experience, we had a couple of things we wanted fixed and the dealer promised they would be done. They offered to sell us the car with a 5-day money back guarantee, just to make sure no one swooped in before the repairs were made. We declined, and it ended up being another 8 days before everything was done. A lot of good that money back guarantee would have done! Save yourself the trouble and don’t buy the car until it’s in the condition you want.

One last chance to negotiate

If there’s one part of our car buying process that I would like to do over, it’s this. I was so focused on making sure we actually got the price we had negotiated via email that I completely ignored the ability to negotiate even further at the point of sale. This was a mistake that I think cost me hundreds of dollars at least, and it’s one that hopefully you can learn from to save yourself money.

When you’re really ready to make your final decision and purchase a specific car, you actually have the dealer right where you want them. They can feel the sale in their grasp, and the prospect of losing that sale (and the associated commission) is much more painful than the thought of selling for a little bit less. You can use that to your advantage to really squeeze their absolute best offer out of them.

Is there anything at all wrong with the car? Maybe a scratch or a small dent? No matter how small, bring it up as something you’re concerned about. When you did your research into this specific vehicle’s reliability, were there any areas where it might have been even slightly deficient? Is there anything about the car that isn’t perfect for your situation? Maybe there’s a particular feature it’s missing, or it’s not the right color, or it doesn’t get the best gas mileage. Again, no matter how much you actually care about these things you can bring them up as reasons you’re hesitant to make the purchase.

Based on what I’ve read, the absolute best move you can make in these final moments is to tell the dealer that you simply need a little more time to consider the vehicle. Maybe there’s another car with a different dealer that you’re considering, or maybe you just haven’t fully made up your mind. Whatever your reason, tell the dealer that the price just isn’t exactly right, and that unless they can lower it you’d like to take some time to think it over, and that you’ll be back in touch with them if you’d like to make the purchase. This will either get a better offer out of them or it won’t, in which case you can thank them and begin getting up to walk out the door. If they let you get out the door without making a better offer, you know you’ve got the best price they can give you.

The absolute worst-case scenario here is that you make it all the way out the door and have to turn right back around and say you’ve changed your mind and would like to go ahead with the purchase. It might be a little embarrassing, but I think it’s absolutely worth it to make sure you’ve gotten the best price possible. I did not follow this advice and it’s my one source of regret from the entire process.

Avoid the extras

Once you’ve agreed on the price you’ll have to sign some documents and then you’ll be handed over to the “business manager” who will finalize the deal with you. This is where they’ll try to sell you all the extras, such as an extended warranties, floor mats, and that sealant that will supposedly keep the car looking brand new for the next 10 decades. If you hadn’t decided ahead of time that there was something specific you wanted, you’re probably better off saying no to everything they offer. Keep in mind that you can get almost anything they offer at a later date and at a lower cost if you truly want it, even an extended warranty.

If you’d like some additional details on whether an extended warranty is a good deal, you can check out the resources here and here.

Registering the car

The dealer will handle the process of registering the car with your state’s Department of Motor Vehicles. If you’re trading in your old car or are otherwise getting rid of it, you’ll have the option of either transferring your existing plates or getting new ones. Take a look at when your current registration expires before making your decision. If it’s expiring soon, it may be worth the extra cost to get new plates to save you the cost of transferring now and then the additional cost of renewing your registration shortly after. As an example, I paid $25 to transfer my plates only to find out a month later that my registration was set to expire and I needed to pay $50 to renew. If I had been smart, I would have paid $50 up front for new plates and saved myself $25. Not a huge deal, but it would have been nice to think of that ahead of time.

Keep in mind that if you transfer your registration, you will no longer be able to drive your old car. This is a non-issue if your trading it in, but if not this could matter as a car you can’t put on the road might be difficult to sell.

Update your auto insurance

Once you’ve actually made the purchase, the dealer will ask for your insurance information and will send all of the details about the new car to your insurance company. But you still need to actually call the insurer and update your policy. This is one of the very first things you should do after making your purchase and it should only take a few minutes.

You should consider how you might want your coverage to change now that you have a new vehicle. For example, we didn’t have comprehensive or collision coverage on my old car because its value was so low that the cost of the insurance just didn’t make sense. But we absolutely wanted these coverages for our new car, so we had to inform the insurance company of the update. Take some time to think over any changes you might want to make beforehand. This is actually a great opportunity to consider how your auto insurance fits into your overall insurance plan and make any needed adjustments to ensure your family’s financial security.

Getting the title to the car

The title is the document proving that you own the car. This is another thing that the dealer should handle for you as part of your negotiated price. Each situation probably differs, but it took us about three weeks before we received the title in the mail.

Enjoy the new car!

Congratulations! You’ve now navigated the entire car-buying experience like a champ and you get to drive home the perfect car purchased at the perfect price. If you’re like me and haven’t yet bought a house (and maybe even if you have), this is very likely the biggest single purchase you’ve ever made in your life. Take a moment to enjoy your ability to pay for something like this, and take pride in knowing that you handled the process well. With any luck you won’t have to do it again for a long time.

Image courtesy of Naypong / FreeDigitalPhotos.net

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Matt is a fee-only financial planner dedicated to helping new parents build happy families by making money simple. His free time is spent building block towers and jumping on beds with his two awesome boys. If you want to learn more, you can go here.

Latest posts by Matt Becker (see all)

  • cashRebel

    Matt, I’ve really enjoyed this whole series. I never knew you could negotiate via email, and I’d never think to risk walking away at the last minute. You’ve clearly done your homework, and I’m going to use this article the next time I need to buy a car.

    • http://momanddadmoney.com/ Matt @ momanddadmoney

      Thanks a lot Ross. I certainly hope it can be helpful. I was able to learn a lot from others so I’m happy to pass it on.

  • John S @ Frugal Rules

    I’ll second Ross in that this has been a great series Matt! I could not agree more with trying to negotiate one last time when actually there to seal the deal. We did that very thing when we bought our last car and we could tell it really threw off the salesman we were dealing with. For us, doing that got us several more hundred dollars off the price and having a few extras thrown in for free that we weren’t going to get anyway so it worked out pretty good.

    • http://momanddadmoney.com/ Matt @ momanddadmoney

      Sounds like you guys did it right! Definitely something for us to try out the next time around (hopefully not too soon, haha).

  • AvgJoeMoney

    Funny, I’ve read about the last gasp negotiation and I always let it go on purpose. I always do a ton of negotiating via email and then when I walk into the dealer I’m done….because if there’s anything wrong I don’t want to be that guy who they think is a total d@#kwad that they don’t want to deal with.

    That’s probably misguided. They have plenty of other customers and my ego makes me a bigger deal for them than I really am, but I’m such a hard-ass early on that I feel like the end of the deal is where they get to preserve what little profit I’ve left them with.

    Great series, Matt!

    • http://momanddadmoney.com/ Matt @ momanddadmoney

      I definitely understand the feeling, and I’m not really in a position to say much since I didn’t actually do any negotiating in-person. But they won’t sell you the car at a loss. If they’re agreeing on a price, it’s a price that works for them, even if it’s not the one they really want. So you certainly don’t want to be a jerk, but I don’t think you have to feel bad about taking what you can.

  • Holly Johnson

    Great tips! When we negotiate, we play good cop/bad cop. I am always bad cop!

    • http://momanddadmoney.com/ Matt @ momanddadmoney

      Haha, I want some video next time! That would make for a great blog post.

  • http://www.youngadultmoney.com/ DC @ Young Adult Money

    I have really enjoyed this series, Matt! As I said in my comments on previous posts, I have two aging cars and will have to go through this process very soon. I like that you pointed out the facct that you should have the dealership fix anything before you purchase it. When I bought my first car my freshman year of college, my Dad and I noticed that there were a few lights out in the back. The dealer gave us something like $50 and we fixed it ourselves for something like $20-$25. Sometimes smaller stuff it’s better to work out a discount, but on bigger things it makes sense to have it all fixed before you sign the dotted line.

    • http://momanddadmoney.com/ Matt @ momanddadmoney

      That’s a great idea if it’s a small repair you can handle yourself. Or actually it’s probably even better if it’s a bigger repair you can definitely handle yourself, since the absolute savings would be larger. For us, it was definitely things we couldn’t have handled and wanted to make sure they did right before we made any kind of deal.

  • http://www.livingrichcheaply.com/ Andrew

    Thanks for an in-depth series regarding car buying…it will definitely be helpful next time we buy a car. Don’t beat yourself over not trying to walk out to see if you could get a better deal…I think you did a great job and I don’t know if that tactic always works.

    • http://momanddadmoney.com/ Matt @ momanddadmoney

      Thanks Andrew. I’m not beating myself up too much, just trying to reflect objectively on positives and negatives. You’re right that it may not have even worked, and I think there’s almost always some level of regret coming out of a negotiation. All in all though I’m very happy with how it went.

  • http://Www.Plantingourpennies.Com/ Mrs PoP @ PlantingOurPennies

    Sometimes you can save money on registration by putting the owner of the car as whoever’s birthdate is further off if registration renewals are determined by birthdate like they are here. Of course, this only works if you and your spouse’s birthdays are far apart.

    • http://momanddadmoney.com/ Matt @ momanddadmoney

      Huh, that’s pretty interesting. I’m pretty sure that up here it’s just based on the day you register the car, but it’s definitely worth knowing little quirks like that to make sure you get the best deal.

  • http://www.makingsenseofcents.com/ Michelle

    Definitely avoid the extras. They make a killing once you go to the “Finance Department.” Those warranties are almost pure profit.

    • http://momanddadmoney.com/ Matt @ momanddadmoney

      Yep, I’m sure you and W know that well. Those things are crazy expensive.

  • Jacob @ iHeartBudgets

    Great end to the series, Matt. It really is all the extras that kill you. My parents were HORRIBLE at buying cars, and always got an extra $2,000 or so tacked onto the loan. UGH!

    • http://momanddadmoney.com/ Matt @ momanddadmoney

      Luckily I didn’t have to run the full “extras” gauntlet since I was buying used, but they still push the warranty pretty hard. It’s crazy how much all of those things cost, and how much less you can get them for elsewhere.

  • Done by Forty

    I love the advice to try to get a last concession (or three) right before the deal closes. I’ve heard this called “nibbling” and, you’re right, it’s a fantastic point in the negotiation to ask for more.

    • http://momanddadmoney.com/ Matt @ momanddadmoney

      Right when they think they have you is right when they really don’t want to lose you. Next time I think we’ll be better at taking advantage of that.

  • http://theheavypurse.com/ Shannon Ryan

    I’ll echo the other sentiments, Matt – this has been a great series! As always, you’ve done your homework and made it easy for us to follow your practical tips. Much appreciated!

    • http://momanddadmoney.com/ Matt @ momanddadmoney

      Thanks a lot Shannon!

  • http://www.debtandthegirl.com/ Debt and the Girl

    Thanks for the helpful suggestions. Always good to know how to negotiate. It can help save you thousands!

    • http://momanddadmoney.com/ Matt @ momanddadmoney

      I’m terrible at negotiating but I definitely learned a lot during this process. And you’re right, it can save you so much money, especially on big purchases like this.

  • Cat Alford/ Budget Blonde

    Wahoo I am loving this series. I am going to try to keep my 12 year old car kickin’ mostly because we have two very big expenses on the way. ;) But, we will prob have to shop for a new car soon!

    • http://momanddadmoney.com/ Matt @ momanddadmoney

      Haha, that you do! As long as your car has a back seat though you’ll be fine for a while at least. It’s once you get that 3rd or once you start hauling their friends around that something with more space might need to be in the cards. You guys have some time.

      • Cat Alford/ Budget Blonde

        Haha I like how you’re already talking about a 3rd. Did my mother-in-law pay you to say that. ;) ;) Thanks Matt!

        • http://momanddadmoney.com/ Matt @ momanddadmoney

          Haha, no pressure or anything!

  • Kim@Eyesonthedollar

    I think it’s really hard to get up and walk away or say you are going to. Email is one thing, but it’s hard in person. Don’t beat yourself up over it. You got a great deal.

    • http://momanddadmoney.com/ Matt @ momanddadmoney

      Thanks Kim. I’m really not too down on it, just wanted to be objective about what was probably a missed opportunity. You’re absolutely right though that it’s harder to do in person. I think this first run will make it easier the 2nd time around though.

  • http://www.moneylifeandmore.com/ Lance@MoneyLife&More

    I’d get quotes for multiple insurance companies on the new car. It may be cheaper with a different company than you currently have.

    • http://momanddadmoney.com/ Matt @ momanddadmoney

      That’s certainly true, though I’m a huge fan of my current insurance company and it would take more than a little savings to make me switch. Shopping around is definitely worthwhile, but the lowest price is not always the best deal.

  • krantcents

    You must negotiate before you sign any papers and this refers to everything! Last time I bought a car, I used a car broker because it gave me an additional advantage.

    • http://momanddadmoney.com/ Matt @ momanddadmoney

      I’ve never heard of a car broker before you mentioning it. What kind of commission does the broker get? Is that on top of the car price for you?

  • http://www.makemoneyyourway.com/ Clarisse @ Make Money Your Way

    Surely in the future I will follow your great tips Matt when I’m ready to purchase a car. But as of now I will try to save more . :)

    • http://momanddadmoney.com/ Matt @ momanddadmoney

      Thanks Clarisse. Saving up is definitely the important first step.

  • Laurie @thefrugalfarmer

    Ugh, Rick learned the lesson about having them fix it before you sign years ago. He was 25, and just bought his first brand new pick up truck, complete with a smaller, shabbily fixed paint defect. They “promised” to re-do it, but Rick didn’t know to get it in writing. You can imagine what happened: he fought with them for months, but they totally blew him off. It was a hard lesson to learn, but one he’ll never forget, and one he’ll never make again.

    • http://momanddadmoney.com/ Matt @ momanddadmoney

      Tough way to learn the lesson. I was lucky to have my mechanic give me the advice, though I think I would have followed it anyways. You just want to make sure the car you’re paying for is the car you have in front of you.

  • Alexa Mason

    I think negotiating via email would be the best thing for me. I usually get so annoyed by car salesman that I walk right out – even if there really is a good deal. That’s why I prefer to do business locally. The locals don’t apply the pressure that the city car salesman do.

    • http://momanddadmoney.com/ Matt @ momanddadmoney

      We negotiated largely by email, but I think there’s still a chance to negotiate a little further in person. But certainly the value of doing it by email at least to start is that you walk in with a great offer already in hand. Hard to beat that.

  • Walt@ My Wealth Desire

    Very informative tips. Yes some dealers or agents will not fix if you already sign the paper. For them, they get what they want…they want your money after all.

    • http://momanddadmoney.com/ Matt @ momanddadmoney

      Well said. Thanks Walt.

  • Monasez (@Monasez)

    When I bought my first car I had to negotiate with the dealer and it was intimidating but I got a lower price and everything worked out well. Great post.

    • http://momanddadmoney.com/ Matt @ momanddadmoney

      Thanks Mona. I’m not incredibly comfortable negotiating either, which is one of the reasons I found the email negotiation tip to be so helpful. It’s less intimidating and a little easier than doing it all in person.

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  • http://twitter.com/sunkcosts slug

    This was a really nice series. I appreciate you really hammering home the benefits of negotiation and the cornucopia of different times that you can be doing this throughout the process.

    • http://momanddadmoney.com/ Matt @ momanddadmoney

      Thanks a lot. There is a lot of room for negotiation here, and when you’re talking thousands of dollars it only makes sense to take advantage of it.

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