This Blog is in it's final days!!!

I have a crazy firewall at work that seems to get stricter and stricter each day, kind of defeats the purpose of an insider at work. I don't think that I'll be able to keep this blog active enough to attract anyone, but... I will update www.insidercarbuyingtips.com often. I also received some excellent information recently and will be able to sell warranties better than those I offer at work and I'm able to kick butt on pricing. Bye for awhile...

In the mean time,

Take care and beware,
J the Car Guy

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Big Sale Is Over!

This was by far the most worthless sale we have ever had. The sales guys they sent out thought there s**t didn't stink and let me tell you the whole dealership smelled of it. Actually, the salesmen they sent were professional and good, but one manager in particular thought he was top dog. They used techniques that are illegal (payment packing) and new before they got here that the 50,000 mailers going out were not going to hit in time for the sale.

The dealership actually did not pay the crew that came out, to try and recoup some of their money for the mailers that were flooded in Florida, and that caused all kinds of issues.

I'm sorry it took so long to report, but we had some long nights where I had to stay late and was just exhausted. All in all, they averaged $4,200 per deal, which is typical for these sales, and the reason I try to keep consumers from buying at these events.

I also found out that I can no longer access Blogger.com from my work computer, due to their firewall, so this will limit some of my blogging, but I will still update with any news worth mentioning.

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The Big Car Sale Has Begun

I haven't seen an atomic pencil like that in a couple of years... They blew this guy out of the water, it was hilarious.An atomic pencil is a huge set of first numbers, that is designed to blast a customer to the ceiling. For instance, with this deal the customer was looking to buy a $27,000 truck and the first numbers they showed him was a 36 month finance term with $8,100 down and monthly payments of $860.

For most customers this blows them away and they have to be peeled off the ceiling with a spatula, which is actually the point of the atomic pencil. It's designed to get a customers thinking up. For more information read my Car Buying Tip #19 - How To Negotiate With A Four Square.
You'll also find some tips for using the four to your advantage.

By the way, these guys here for the sale are really good and as long as we get traffic it will be interesting to see what I'll be able to report. I'm sure we will have some huge deals this week, so stay tuned.

A quick for those of you here for the first time, do not buy at car dealership big sales events. They are typically a big rip off and prices actually go up believe it or not.

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Big Car Dealership Sales Event

We have a big sales event starting at the end of August. I'm sure this one will have a lot of exciting stuff to report.

They are planning to send out like 50,000 mailers, do some big radio spots and plenty of print ads. They are also bringing in an entire team. The team will consist of a desk man, closers, finance managers and salesmen.

I'm sure this sale will do a lot better than the last, so stay tuned and I'll give you a play by play of all the deals. I'm sure this one will really open your eyes to what a rip off these sales events are.

In the mean time...

Take car and beware,
J the Car Guy

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Lender Review and Credit Breakdown

Especially Important For Bad Credit Consumers!

For those of you who didn't know or haven't had time, remember to check out my Lender Review and Credit Breakdown on how lenders see you. You can apply for financing to multiple lenders and get a better feel for what type of credit tier you will fall into.

You can find this here Car Loans. I tried to set it up in an easy to read bullet fashion and I think you'll find it pretty informative. It should save you a lot of time and frustration. There are lenders for both good and bad credit. Check it out.

For those of you looking to refinance, check out my other site EZAutoLoanRefinance.com it's really easy to refinance, the average customer saves over $60 a month and the best part is it's free. Apply today.

In the meantime...

Take care and beware,
J the Car Guy

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How to buy a car with negative equity in a trade

I have received several emails lately from customers in some pretty serious negative equity situations. One customer was told by a car dealership that she had $14,000 negative equity and there was no way that they could get her approved with that kind of negative equity. So how does she buy a new vehicle?

First off, I'd like to say that this is an extremely difficult situation and with this much negative equity will be tough to accomplish. It's all going to come down to finding the right vehicle that can absorb the negative equity and still be in line with the lenders loan structure.

1) You can put $14,000 as down payment.
Obvious one, but unlikely possible for most customers.

2) You can buy a new truck or SUV and finance with the manufactures financing arm.
Trucks and SUV's have some rather large rebates currently available on trucks and SUV's. Manufacturers are eager to move these units, so they are offering big rebates and flexible financing to help them sell. This obviously does you no good if you don't want a Truck or SUV, but unfortunately cars are stronger right now and manufacturers aren't offering rebates as big.

3) You can buy a late model used Truck or SUV.
These are selling very cheap at the auction and dealers are buying them, in some instances, for half of book value. Again, it does you no good if you don't want a Truck or SUV. There are some late model cars that come to mind that may also work in this scenario, the two that really stick out are Cadillacs and Pontiacs.

4) You can refinance and lower your interest rate so that more of your payment goes to principal.
This is probably going to be your best option. Unfortunately, this means you'll have to keep your current vehicle for awhile longer, but you may not have a choice. If you're not able to get a new vehicle with the above options, you're going to be stuck with the vehicle anyway, so you might as well have lower payments and make each one of those payments count. By count I mean have more of your monthly payment go towards principal then to interest. Refinancing is FREE and you could have up to 60 days to your first payment.

If you're interested check out my Auto Loan Refinance site. The average customer is able to lower their payments by over $60 a month and lower their interest rate by close to 4%.

You may be wondering how you'd be able to refinance your vehicle, but not be able to buy a new. Basically, let's say your vehicle has a book value of $28,000 and you owe $32,000, but do to current market conditions it's only worth $18,000 to a car dealership. Well most lenders are going to use the book value to figure how much they will lend and not what they sell for at auction. So it can be done. Of course, all approvals are OAC. If you are in an extreme situation like this, it certainly can't hurt to try.

In the mean time...

Take care and beware,
J the Car Guy

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Buy the extended warranty BEFORE the car breaksdown!!!

I can't tell you how many times I've had customers come straight out of service and pay some outrageous bill only to come over to my office and buy an extended warranty.

In fact, I just recently had a customer who did just that. She paid a $2,500+ repair bill and then shelled out another $1,400 for an extended warranty. If she had bought the warranty before the breakdown, the warranty would have more than paid for itself.

I asked why she hadn't bought one when she bought the car and she said when she bought the car it still had some factory warranty remaining and she was going to buy one once she got close to running out of the factory warranty, but never got around to it.

The extended warranty would have cost her less had she bought it while the car still had factory coverage and she wouldn't have had to put the extended warranty on a to do list, which I've found most people don't ever "do" until it's too late.

If you are the type of customer that buys extended warranties (which I always think is a good idea), just do it at the time of sale. It's cheaper and you don't have to remember to do it later.

In the mean time...

Take care and beware,
J the Car Guy

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Car Buying Tip #9 -- Extended Warranty -- Don't Get One!

This is a follow up to my original article entitled Extended Warranty -- Get One! In this article, I'm going to point out the customers I've found that don't necessarily have to have the protection an extended warranty can offer.

The first set of customers I'd like to identify are those that only buy new vehicles and trade regularly before the factory warranty expires. I don't think I need to spend a lot of time on this, because you are already covered, and to buy an extended warranty, legally referred to as a service contract, would be a waste of money.

The second set of customers I'd like to identify are those that have extreme incomes with a low debt ratio. If, using an extreme example, you have a monthly income of $20,000 with monthly expenses of only $3,000, then you should be able to comfortably afford an unexpected $1,500 repair. On the other hand, I've found people with those types of incomes are usually buying high end vehicles where the average repair might be in the several thousand dollar range.

I'm reminded of my days working for Volkswagen, and the repair costs for one of their Touareg models. I remember a customer that had to have the diesel engine replaced...cost: $18,000 plus. Just to have the brakes changed was close to $1,100...Ouch! Now imagine even higher end vehicles like Mercedes, BMW, Porsche, etc.

The option to purchase an extended warranty will simply be up to you at this point. Keep in mind that both the extended warranty company and the car dealership profit when you purchase an extended warranty, so you'll want to weigh your options carefully. On the other hand, even with a profit for both the extended warranty company and the car dealership, I've seen where extended warranties have more than paid for themselves, on many an occasion.

I know of many well to do customers that "will" purchase the extended warranty, simply because $1,500 to $3,000 for the warranty is a drop in the bucket for them and they simply don't want to deal with the hassle of haggling with the service department over repairs. They just want it fixed and fast!

The last set of customers that I'd like to identify are those that are purchasing very inexpensive vehicles. Extended warranty companies will typically have a clause in the contract that states that the repairs they will make to the vehicle shall not exceed the wholesale value of the vehicle immediately prior to the mechanical breakdown. What this means, is if your vehicle has a wholesale value of $1,500 the extended warranty company will not authorize any, accumulated over the life of the extended warranty, repairs that exceed the value of the vehicle.

The reason this is important to note is that a vehicle that is worth $1,500 wholesale is probably old, with high miles and the extended warranty is probably going to cost more then the max payout you could ever expect to receive.

I hope this car buying tip has helped to shed some light on the sometimes confusing issue of extended warranties.

As mentioned before some people that fall into the categories listed above still opt for the protection, and additional benefits, of the extended warranties. If you'd like to get more information, I've found what I consider to be the most comprehensive coverage available. In fact, this coverage is more comprehensive then the coverage I offer at my car dealership. To get a FREE quote Click Here...

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Car Buying Tip #8 -- Extended Warranty -- Get One

If the thought of an extra $25 - $30 a month seems like more than you can handle to get an extended warranty, then you probably need one.

I see it all the time, customers come to the car dealership I work for and are looking for a $300 payment. By the time all is said and done their base monthly payment is $350, already exceeding their "max" payment by $50, and now they are faced with the decision to protect their personal finances and credit rating with an extended warranty, but the increase in payment is more than they feel they can bare.

First off, I'd suggest you work a deal on another vehicle where payments would be more comfortable for you. One of the number one reasons people face repossession is that they simply can't afford the vehicle and have no choice but to give it back. This is especially true when a customer is maxed out on payment and the vehicle breaks down.

Think you are having problems with a $350 payment, what happens when you take that $350 payment and add a $900 unexpected repair to that? To simplify this, your monthly payment would have been more like $1250, with repairs, vs. a $380 payment with the extended warranty. I hope you catch my drift on this, because it can mean so much to your present financial condition and to your future credit rating.

If you do opt to purchase the extended warranty, legally referred to as service contract, read the contract carefully. You'll want to know if you are purchasing a stated components coverage, or an exclusionary coverage. Exclusionary coverage is always the better option.

Exclusionary coverage will simply state that everything on the vehicle will be covered except for what is listed in the Items Not Covered section of the contract. A stated components coverage will state that the items listed are the only parts that are covered. Unless you are a Master Mechanic, how will you know what the items are that won't be covered? This is where a lot of people have had bad experiences with extended warranties.

It all comes down to the Finance Manager at the car dealership not explaining the warranty in depth and customers not knowing the right questions to ask.

To sum this up, unless you've got several thousand dollars available that you could comfortable part with over the course of your ownership of this vehicle, buy an extended warranty.

I hope this car buying tip sheds some light on the sometimes confusing issue of extended warranties.

I have found an extended warranty company online that, hands down, has the most comprehensive exclusionary coverage available. In fact, this company offers coverage that I don't even offer at the car dealership I work for. Not because we wouldn't want to offer this coverage, but we simply haven't found a company that has coverage like this available to car dealerships. They are a very financially sound company, and they pay claims quickly, without hassle. To get a FREE quote Click Here.

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Bad Credit Tip #3 - Bad Credit Loans

So you've got bad credit, no credit, or straight out horrible credit. You've applied to nine lenders online and gone to four different car dealerships to get the same answer from all. A resounding, NO! Well, don't despair. Your world is not tragically crumbling down around you.

"What's the problem," you ask. Good question. You're looking in the wrong places. You may be thinking that you have applied to some of the biggest banks in the country and have gone to some fairly large dealerships, so if they can't get it done, who can?

First off, the larger banks, do not typically cater to those in search of bad credit auto loans, nor do most car dealerships. For the lenders there is simply too much risk and for the car dealerships it is, in their minds, too much of a hassle.

That is where sub prime loan specialists, like myself, come into play. A good sub prime loan specialist understands your needs, knows the right lenders, knows how to properly structure a bad credit auto loan, and stocks the right inventory.

My advice would be to call local car dealerships, ask them if they have a sub prime credit department and if you could speak to one of the finance specialists (be sure it is not a sales person you are speaking with). Once on the phone with them explain your situation and see what services they can offer to help you. If you like what they have to say, go visit them. If you don't like what they have to say, call the next dealer in the phone book, until you find the right one.

It's a little time consuming to make all these calls, but it's well worth it when you find the right loan specialist that can get you on the road and driving again.

If you'd like to bypass all the time consuming calls and find local loan specialists that can help you quickly I'd strongly suggest applying Here. It's FREE, fast, easy and with their huge nationwide network they can put you in touch with a loan specialist that can have you driving your new vehicle in as little as 24 hours.

In the mean time...

Take care and beware,
J the car guy

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Bad Credit Tip #2 - Settle For Less

This is an easy one that can help you to save hundreds, if not thousands when trying to clean up your credit. Before I get to the Bad Credit Repair Tip let me quickly explain how collections companies work.

Most collection companies will buy your debt from the original creditor for pennies on the dollar, hoping that their expertise in collecting will allow them to make a rather substantial profit if they are successful, and you pay in full.

Let's say that XYZ company had given you a loan for $1,000 and you were to repay the loan within one week. Well XYZ hasn't received a payment and it's now two months later. They forward your now delinquent account to their in house (if they have one, not all do) collection department, where they will try to collect. Now, another four months has passed and they haven't been able to collect, so XYZ company is now going to try to cut their losses and get paid whatever they can for that $1,000 from whoever is willing to pay them something.

In this case, ABC collections is glad to step up to the plate and pay $200 for your $1,000 debt in hopes that their far superior (sometimes they get big heads) collection skills will allow them to collect that $1,000 and gross an $800 profit.

Here's where you can save some money...Your ready to get a new loan for a car, house, credit card, etc. and realize to get the better rates it's time to clean up your credit. My suggestion is to try and settle for less.

Using the above example, you call ABC collection agency and tell them you'd like to settle your debt, but have let's say only $500 and that's all you can afford, would they agree to accept your $500 to settle your $1,000 debt. More often than not the bulk of these collection agencies will settle for less, and in this example would have pocketed a $300 profit plus their $200 initial investment.

Way to go!!! You just moved yourself one step closer to getting your credit restored and saved yourself $500 in the process. Don't forget to ask them to stop reporting to the credit bureaus. Read my post on removing these items Here

In the mean time...

Take care and beware,
J the Car Guy

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Random Car Buying Tip - Buying Cheap Used Cars

Just a heads up for those of you that have $2,000 to $3,000 cash to buy a car with, a car dealership is probably not your best option. You see a car dealer has a certain level of responsiblity they take on when they sell a vehicle and they don't want to get caught up selling a $2,000 which is probably old with higher miles for a $200 profit let's say.

You will also need to pay sales tax and any dealer fees that apply. In Arizona, where I live, a private party purchase for a vehicle is exempt from taxes, which is always nice, and you avoid all dealer fees, which applies to any private party transaction (obviously).

If you're looking for an inexpensive vehicle I'd definitely not waste your time looking at car dealerships, until you've exhausted your search in your local paper, or one of the online sources available. You'll probably find you'll get more vehicle, in better condition, with less miles, for the same money.

I know of a great site to sell your vehicle private party, so I'll go way out on a limb here and assume they are a great place to buy a used vehicle Here.

In the mean time...

Take care and beware,
J the Car Guy

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Watching the car dealer auction

I'm watching the car dealer auction, out of Phoenix, online right now and I'm telling you if you're in the market for a used Truck or SUV now is the time to buy. These things are selling so cheap right now!!! I'm watching these vehicles sell for $5000 to $8000 back of wholesale book. Cheap, Cheap, Cheap...

On the other hand I would absolutely stay away from New Trucks or SUV's. If you buy one expect to take a bath, a major bath, as soon as you drive off the lot. If you absolutely have to go with a new one lease it.

Take care and beware,
J the Car Guy

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Bad Credit Tip #1 - Have that collection removed

I see it all the time, people trying to do the right thing and clean up their credit, but doing it the wrong way. One of the easiest, but top mistakes I see people make when cleaning up their Bad Credit is to pay off or settle a collection and not insist that the company stop reporting to the credit bureaus.

It's simple to do, just insist that before you pay the company will stop reporting the collection. Make sure to get an actual commitment and not some round about we'll see what we can do. Preferably get it in writing.

The reason this is so important to cleaning up Bad Credit is because you don't want any sign to future lenders that an account had to go to collections before you were willing to pay. Not to mention, it will drag on your score for some time to come.

Repairing Bad Credit can save you thousands in the long run with lower APR's on vehicles, mortgages, etc... It's also a little embarassing to get turned down for a loan in public. Do yourself a favor and review your credit today Fico Scores/Reports

Take care and beware,
J the Car Guy

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The car market is terrible, now's the time to buy!!!

First off, I'd like to apologize for not posting in awhile and for some of the delayed responses to emails I've received. Unfortunately, there hasn't been much to report due to the very big slow down in sales. Secondly, I had to attend to some personal family matters that had me out of town for more than a week.

That being said, NOW is the time to buy if you are in the market for a new (I personally wouldn't go new) or used SUV or Truck. Dealers are practically giving them away! If you're trading in a truck or SUV don't be too shocked when you see the trade in value. Cars are currently selling at auction for over wholesale book, while some of the large trucks and SUV's are selling for as much as $9,000 back of wholesale.

I personally just bought a 2005 Expedition Eddie Bauer addition with 23,000 miles for $4500 back of book and traded my '06 F150 Crew Cab XLT for about $5000 back...OUCH!!! The Expedition I bought is way nicer with the big V8 and I'm very happy. I thought I'd share that with you, just to let you know that even me being inside knew I was going to take a bath on my truck, because I could see what they were selling for at auction. So again, don't be surprised to see little numbers for your trade, but definitely don't pay retail for the new one.

You may want to try and sell your trade in on your own and get yourself more money. If you do I'd Sell your car on Cars.com: reach 65% of online used car shoppers


In the mean time...
Take care and beware,
J the car guy

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The #1 All Time Top Car Buying Tip

Be Prepared! Well that's not so special you say. You're right it's not rocket science, but how do you prepare? I'll show you in just a second. First off I want to share with you some research I've done at the dealership I work for. I've tracked the last 75 deals that have been made here and found that prepared / educated buyer's (prepared in my opinion) paid over $3,100 less than the unprepared / uneducated buyer's.

If savings of $3,100 or more doesn't peak your interest, then I don't know what will. Keep in mind that car dealership sales people are professionals, and sell cars everyday; they are prepared and educated. On the other hand your average consumer certainly doesn't buy cars everyday and is therefore unprepared / uneducated. So a consumer walking into a car dealership unprepared to buy a car is at a huge disadvantage.

Here are some simple steps for you to prepare:

Start Shopping Online. Research car prices, print invoices and find the perfect vehicle for you. Get Free Price Quotes at Edmunds.com


Know Your Credit. Know your score and review your credit file. Clean up any inaccuracies and/or delinquent accounts. A high APR adds up to a lot of wasted money over the term of a loan. Go to Fico Scores/Reports to know your credit now!


Get Pre-Approved For Your Car Loan. Car Dealers make huge profits when they arrange financing. Pre-Approval gives you the power to "Buy Like A Cash Buyer." Good credit Click Here Middle of the road credit Click Here Bad Credit/No Credit Click Here they are all Fast, Free & Easy!

Know Insurance Costs. This gets a lot of people into trouble after the fact. They take on a new car payment and find out their insurance rates are also going to go up. Save money and get a FREE quote from AIGDirect.com by clicking HERE


Know A Car Dealerships Steps To The Sale. Read my 11 Steps To A Car Sale-They Hope!

Know Your Trade Ins Value. A dealership can under allow for your trade in and boost their profits. Check sites like Kelley Blue Book and NADA.

Know What Warranties Cost. Marking up warranty costs is a big profit center for car dealerships.
Click here to get a FREE, No Obligation, Extended Auto Warranty Quote in Less than a Minute!

Get All Promises In Writing. Don't accept verbal promises, more often than not you'll get burned.

Review Your Contract Carefully. Slow down and understand all the figures. Bring reading glasses, if you need them.

Compile Your Information. Bring a copy of your loan approval, invoice printouts, trade in values, and to really chap their hides, bring a financial calculator and use it when negotiating.

There are many car buying tips that will help you get a great deal when buying a new vehicle, these are some of the best and most successful ways I know of to prepare for your next vehicle purchase.

In the mean time...

Take care and beware,
J the Car Guy

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Car Buying Tip #7 - Typical Car Dealership Payment Plans

I'm sure this is going to be a rather controversial article for any car dealer employees that read this, so the feedback should be interesting.

The most common pay plans that I've seen start a sales persons commissions at 25% of the front end gross profit. So if the dealer buys a car for $9500 and does some repairs and a detail for $500, they'll own the car for $10,000. Most dealers will have a pack on top of that, a non commissionable profit paid directly to the dealer, which varies, but usually falls in the $500 range.

In this scenario the sales person is starting with a base cost of $10,500 and let's say the sale price on the vehicle is set at $15,995. In a perfect sales persons world that would be a $5495 front end gross of which he/she would be paid 25% or $1373.75.

Wow!!! They make that much? Not quite. Deals like that don't happen as often as some might think. With new cars for instance, more often than not a sales person will be paid a mini. A mini is a flat amount paid to a sales person when the commission amount is below the set "mini." Most dealers will have a mini of $100. I've seen some higher and some a little lower, but that's the most common.

Keep in mind, the national average for car sales people is roughly six to eight vehicles sold per month, and not many sales people are getting rich in this business. Personally, I always let the sales person know that I am going to tip them if they can make the process quick and get to the price I want.
I'll typically tip $100 to $200. It may sound like a lot, but if the sales person was able to help me find the right vehicle, quickly negotiate invoice price, and was pleasant in the process, then I think it is worth it. Be careful not to let the dealer know this if you decide to go this route, because the sales person will lose their job.

Most dealerships will have some sort of incentive for sales people to sell a bunch of cars, and usually comes in the way of increased commission percentages for a certain amount of units sold in a month. The most common I've seen, will up the percentage to 30% at ten sold units and go to 35% at thirteen to fifteen sold units for the month. This is usually retroactive and will pay the higher percentage all the way back to deal one for the month.

There are usually bonuses that car dealerships will set for the sales people as well. Sometimes it's a volume bonus, sell 15 vehicles and get a $250 bonus, or some quirky ones like a $50 "spiff" for getting a customer to climb into a trunk and close the door to demonstrate the glow in the dark child safety trunk release. Unless you are one that doesn't embarrass easy, please don't do this. Trust me the whole dealership will be watching.

Your average sales person, not working for a high end dealership, will make between $35,000 and $45,000 per year. Most people tend to believe cars salesmen make much more, but this seems to be the average range for most sales people I've known.

There are exceptions. I've known really good sales people that earn over $200,000 a year. A really good sales person working at a higher end dealership (BMW, Mercedes, Lexus, etc.) can easily make $200,000 a year with the top earner I've ever met making over $300,000 per year. Big money!

Use this information how you see fit, just please keep in mind most car sales people are not bad people, and certainly don't deserve to be treated that way even if you've had bad experiences in the past. Remember if you don't like who you're dealing with you can always leave or request a new salesperson.

As for the rest of a dealers retail staff, i.e. Sales/Desk Managers, Closers, GSM's, GM's, Finance Managers and Owners, their pay can vary widely depending on the dealership.

A typical Sales or Desk Manager will make roughly $6,000 - $12,000 a month, a Closer (often times is the Sales/Desk Manager) will make the same $6,000-$12,000 a month, a General Sales Manager will make roughly $10,000-$15,000, a General Manager will make roughly $15,000-$30,000 a month, and Finance Managers will make roughly $5000-$12,000 a month.

For Owners, their pay can vary even more. Smaller dealership Owners can make a few thousand dollars a month, while large dealership Owners can make up to, or more than, $1,000,000 a year in pay. As I said it can vary widely, and typically depends on the size of the dealership. Higher volume dealer = more money, lower volume dealer = less money.

If you're afraid of a car dealership making a bunch of money from you on your next car visit CarsDirect. They Guarantee the lowest prices on new cars, trucks, and SUV's. You're also able to bypass any car dealership sales people. It's a great site, they'll show you MSRP, invoice and their
Guaranteed low price. Check it out.

In the mean time...

Take Care and Beware,
J the Car Guy

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Car Buying Tip #6 - Finance Office Be Afraid - Be Very Afraid!

It's done! The negotiating is over, the sales person has taken three passes at you and you've even gotten to meet the sales manager (closer), and have finally agreed on payments. Whew...What a relief that's over with. Now all you have left to do is sign some papers and you're on your way in your new car. At this point all you can think of is showing off your new car to all your family and friends...Boy, what a nice car.

STOP and focus. The most important part of your car buying adventure is about to take place and trust me, you'll want all your whits about you. If you think you're out of the woods you're wrong. The Finance office is where the majority of scams take place in this business. I'd be willing to say that 80% or more, of all car dealership scams you hear of on the news involve the Finance Department. That being said, I don't want you to automatically assume that all Finance Managers are going to scam you, but if you've run into the one that will, you'd better be ready.

I want to quickly state that I do not believe that the majority of Finance Managers are bad people with bad intentions, but the ones that are will stick it to you if you give them the opportunity. I've personally seen some very elaborate ways to stuff unwanted products into a contract, and the customer is none the wiser.

For most people, if their payment stays the same as what was quoted on the sales floor they believe everything must be in order and they will sign away, but what if the payment you were quoted on the sales floor was packed? Packed is a term used to describe "payment packing" in the car business. I'll save an depth explanation of "payment packing" for another article, but it's the practice of quoting inflated payments to help the Finance Manger sell products to you in the Finance office.

If you're dealing with a legitimate Finance Manager and decide that you do not want an extended warranty, GAP insurance, or any other products they are offering, then the Finance Manager will reduce your packed payment to your real base payment and away you go.

On the other hand, if you're dealing with an unscrupulous Finance Manager then they'll try to fill that packed payment with a product you did not opt for, so they can make money. I've seen Finance Managers stuff up to $2,000 worth of products into a deal without the customer having a clue, because they weren't paying attention.

How does this work? Let's start back at the sales persons desk. Your real base payment, consisting of sales price minus down payment, plus tax, title, license, dealer doc fee, and your finance charges, is $300. The sales person quotes you payments of $315 and you agree to that, not knowing what your real base payment is. This leaves $15 of "leg," a common term used to describe how much the payment has been packed. This may not sound like much, but over a 72 month contract this equates to $1,080.

The good Finance Manager will essentially give that back to you, but the unscrupulous Finance Manager will fill that with with etch (a worthless product for most people, but it's only got a cost in the $70 range, so there is a lot of finance profit) or some other inexpensive item, so they can profit from you. Again, most people are none the wiser. They will see that their payment is the same and gladly sign away.

Don't let this happen to you. The two most important documents you'll sign in the Finance office are the Retail Installment Contract and the Purchase Order. Never sign either one of these blank. The rest of the papers you'll sign are typically for the states Motor Vehicle division, and it is usually only important to verify that your personal information is correct.

I can't begin to tell you how many people will sign a blank purchase order! Don't let this be you. There is no reason why this form, no matter what they tell you, should not be printed. The Finance Manager should also fully disclose these forms at a pace that is comfortable for you to follow along. If they are going to fast stop them and ask them to explain further.

You'll also want to watch out for highlighted contracts. This can be a sign that the Finance Manager is trying to get your attention to the signature line and keep your focus off the rest of the numbers on the contract.

I personally will highlight Motor Vehicle forms, to speed up the process (I've signed literally thousands of deals, and it can get a little repetitive), but I never, never highlight contracts. I always give customers a full disclosure and ask them if they have any questions as to what we've just gone over.

Another key point is to bring reading glasses, if you use them. It blows me away that people that have a hard time reading small print don't bring their glasses. Remember, this is typically the second largest purchase most people will make, so you'll definitely want to know what it is you are agreeing to pay for over the next six years.

Always remember that at this point in the transaction you have not legally committed to anything. If you feel the Finance Manager is being deceptive get up and leave. If you feel they've broken the law call your states Attorney General office.

Keep in mind, when you're on your way into the Finance office it's time to clear your head, put on your reading glasses and know what's on your contract.

In the mean time...

Take care and beware,

J the Car Guy

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Car Buying Tip #5 - Down Payment = A Car Dealerships Gross Profit

There you are sitting at the sales persons desk negotiating your new car deal. The sales person is busy promoting the idea of putting more money down in order to lower your payment, prevent less negative equity, pay less in finance charges, have a shorter term, etc. All of this is true, but their real motivation is to make more money.

The additional gross profit a dealership makes by getting more down payment from you all comes down to how lenders lend. Using this example, let's say a car dealership has a vehicle for sale for $15,000 and that vehicle has a wholesale value of $10,000. I will leave taxes and other fees out of this to simplify this example. A typical automotive lender, for average credit, is going to lend up to 125% of the wholesale value of the vehicle. The technical term for this is a 125% Loan to Value, or a 125% Advance. So in this example the lender would be willing to loan $12,500 against the value of the vehicle, and the dealer would have to get a $2500 down payment from you to keep the "deal in-line."

If you had $0 as a down payment, the only way the car dealership could get the loan approved would be to lower the sale price to $12,500. I think we all know that the dealership doesn't want to do that, because it's an instant loss of $2500 in gross profit. Sales people are so aggressive when it comes to your down payment because they get paid off the gross profit.

That being said, there are situations where down payment is necessary. If, for instance, you have a lot of negative equity, you'll need to pony up some money to get the "deal in-line" with the lenders guidelines. You'd also need down payment if you have major credit problems. The lender will typically want to see a commitment from you, of 10%, or in some cases a flat $1500 down payment.

So the next time your sitting with your sales person and they're explaining the benefits of additional down payment, it's probably only benefitting them and the dealership. I'd suggest getting off the down payment issue with the sales person, and work on the dealership lowering the sales price by $2500. Once the sales price is acceptable to you, then you can talk down payment.

All that being said, I do believe in giving a down payment equivalent to, or greater than, your tax, title and license fees. This is to avoid paying additional finance charges on those fees. I'd negotiate with the zero down approach out the gate, and work on the dealership lowering the sales price.

There are lots of other tips and tricks you can use to save money when buying a vehicle, but this one is by far the least talked about; although, it's one of the easiest for customers, that don't like to negotiate, to use to realize immediate savings.

If you want to skip the whole negotiation process and get the guaranteed lowest price check out CarsDirect. With their car buying service you can completely eliminate the need to work with a sales person all together.

I'd also recommend getting your own financing, this way you'll hear direct from the bank what their terms and conditions are. Check out the Loan Center. You can compare multiple lenders, for all credit types, and apply online. It's Free, Fast & Easy.

In the mean time...

Take care and beware,
J the Car Guy

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Car Buying Tip #4 - Why You Must Get Pre-Approved For Financing

Car dealerships profit Big Time when you allow them to arrange financing for you. Most consumers do not realize just how big a profit center the Finance office is for a car dealership. There are three major reasons why you will want to arrange your own financing.

#1 You eliminate any rate mark up. What this means is if a dealer were able to get a 5.9% buy rate from a lender, the lender will, on average, allow a two point markup. This means the dealership could sell the loan to you at 7.9%, and over the term of the loan this could equate to hundreds, or even thousands of dollars in profits that you paid unecessarily to the dealer.

For instance, a $20,000 loan at 7.9%, over 72 months, would have a total finance charge of $5,254.72. The same $20,000 loan at 5.9% would have a finance charge of $3,851.44. Subtract the $3,851.44 from the $5,254.72 and your left with $1,403.28. The lender will typically split this with the dealership using a 75/25 or 70/30 split. So that means the dealership would get 75% of $1,403.28, which equals $1,052.46 additional profit for the dealer.

Who do you think gets stuck paying the bill? Drum roll please...You got it, you do!

#2 Getting pre-approved gives you the ability to "Buy Like a Cash Buyer," which greatly increases the leverage you have when negotiating the best possible deal. I recently observed the last 40 deals at my dealership, and found that cash buyers paid over $2500 less per car deal, compared to those that financed. If that's not a call to action, I don't know what is!

When you are able to "Buy Like a Cash Buyer," you don't have to worry about negotiating monthly payment, you can instead focus on the Out The Door Amount, which is exactly why cash buyers save so much money.

#3 You can have the dealer compete to arrange your financing. Yes, I know I just gave you some pretty convincing reasons to secure your own financing, but if you're approved from your source for 6.9% and the dealer can offer 5.9%, take the 5.9%. Who cares if they are making a profit, they just saved you a bunch of money. Better yet, you just saved yourself a bunch of money, because you forced the dealer to give you their most competitive rates, and this was all due to you doing the smart thing and getting pre-approved.

I hope this has convinced you of the importance of getting pre-approved. So let's get over to the Loan Center, find the right lender/lenders for you and get Pre-Approved today!

In the mean time...

Take care and beware!
J the Car Guy

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Car Buying Tip #3 - Top 5 Reasons You Must Shop For Your New Vehicle Online

I have been in the Car Business for close to nine years. Over that time I've noticed that the most educated customers, and the ones that reaped the most benefits of this top five list, were the Internet shoppers/buyers. I can't stress enough the importance of researching your next vehicle online, and I hope this list convinces you to do just that.

#1 Time Savings. In the past you'd have to load up the family and drive to ten different car dealerships, and deal with ten different sales people before you found the vehicle you wanted. This was especially true if you were looking for a specific new or used vehicle. Fortunately, you now have the Internet and can do a search for the vehicle you want without even changing out of your PJ's.

You can also begin the negotiation process online before leaving your house. I don't know about you, but ten car dealerships, with ten sales people, with ten sales managers, with ten test drives sounds like a time consuming, exhausting day, compared to a couple of mouse clicks and a simple I'm interested in this vehicle, what kind of discount can I get, email sent from the comfort of your home.

#2 Money. This one ties in with the increased leverage you have at your fingertips. You will save money shopping over the Internet, because you have much more leverage. Just as you know you can stop responding to someones emails, so does the sales person at the other end. They know they must keep you happy if they ever hope to get you to come to their car dealership and finalize a deal.

Once you find a vehicle you like simply let them know where you stand up front; I've got $12,000 cash to spend, and I like this vehicle. Would you take $12,000 out the door? If the answer is yes schedule a time to go down and test drive it. If the answer is no look for another vehicle. See how much Time was just saved? If the vehicle was listed for $15,000 and you bought it for $12,000, see how much Money was just saved?

#3 Knowledge. Knowledge is power! The more you know, the more confident you'll be when you enter the dealership to make your purchase. You'll know all about the tricks car dealers will try to play, and you certainly won't be one of those people you hear about getting put together for $$$ thousands $$$ of dollars.

You'll also know the process, and will know what's around the next corner, which should drastically reduce your stress level. Being knowledgeable will also come across to the car salesperson and his or her sales managers, and they'll know that your not someone to try and play games with.

#4 Aggravation. You will save yourself a lot of Aggravation shopping over the Internet. One of the most commonly pointed to reason for people hating to go to a car dealership, is the process. This involves the back and forth, meeting eccentric or pushy car sales people, meeting with ten of their sales managers before you can leave, or during negotiations (closers), and possibly spending three to four hours finding a car, test driving, and negotiating to find that you and the dealership are too far apart on the numbers or some other facet. Most all of this can be eliminated by starting the process online. Less Aggravation ties in with both the time and money components. Trust me the Internet can solve all of these problems for you.

#5 Leverage. Plain and simple, all of the above components tie into Leverage. Leverage saves you Time, Money, Aggravation, and goes hand in hand with Knowledge. As mentioned before, the Leverage you have over the Internet is to stop the sales process at any time without being assaulted by professional car salesmen, and their managers. They also understand this and should, if they've caught on to the whole Internet thing, be a lot more attentive to your needs and a lot more aggressive (in your favor) with their pricing.

Another way to use your Leverage when in the dealership, is to be sure you're prepared. Bring printouts of car trade in values, invoices for the vehicle you're looking to purchase, and one that really chaps their hides, bring a financial calculator.

I remember my first deal I worked in the Internet Department and how easy it was for the customer, the dealer and me. The customer emailed about a new Ford F350 Crew Cab 4x4 Diesel King Ranch and asked what was the best price we could give him. We gave it to him and since he'd already emailed three other dealers, he found that our price was best and we agreed to start the process.

He gave us the information we needed to get his paperwork in order, I drove to his house, he signed the paperwork, wrote a check, and took delivery of the vehicle. Very simple process for all involved. I guess the moral of the story, was that he was a very busy, knowledgeable, business man and he new the time, money, and aggravation saving benefits of the Internet, while maximizing his leverage to get a great deal.

I really like the CarsDirect website, it's really easy to navigate, they'll show you the MSRP, invoice and the CarsDirect guaranteed lowest price on any new vehicle. Their car buying service allows you to bypass a car dealerships sales staff, and it's real easy to get pricing. Just go to their website find the vehicle you want and there is the price. No emailing or talking on the phone to get a price. It's a really nice service, and I highly recommend it.

If you're looking for a used vehicle, they boast about having over a million listings. CarsDirect is by far my favorite site for car buying.

Another site that has been around about as long as the Internet, and has an immense amount of information is Edmunds.com. You can make new and used car inquiries from their site, and as I mentioned before, find a wealth of information there.

In the mean time...

Take care and beware!
J the Car Guy

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Car Buying Tip #2 - Stay Away From Car Dealership Big Sales Events

The biggest car sales event of the year! All vehicles must be sold off! Bank repo's, off-lease vehicles, trade ins, we're overstocked and they must go now! All credit applications accepted! Save thousands! This weekend only!

Sound familiar? If you live in a big city you're probably inundated with these kinds of commercials, but are they for real? Well, let's look at the logistics...First off, the advertising alone for one weekend can run some dealers up to or over $100,000! No. That's not a typo. Between radio, newspaper ads and mailers it can add up quickly.

Next to figure is the cost and time to move all the used inventory to some off site location, where they've rented tents, generators, the location itself, an around the clock security company, moved their computers, bought balloons, bought food and drinks, and brought in a team of special event sales people. These people will be gone in a week, and more often then not, the promises they make you will never be delivered upon.

Call me crazy, but that sounds like a whole lot of trouble to go through to sell a bunch of cars for a loss. Now there may be dealers that have sales where they really do need to move some inventory, and will make some great deals just to move some older vehicles off their lot and get the cash flowing. For the most part these events are not pleasant experiences for most customers, and you will not get any screaming used car deals.

The first sign that this Big Sales Event is a sham, is when you see something like this on the windshields: WAS $687 Mo. NOW $478 Mo. If they were really "slashing" prices, they'd show you Kelly Blue Book, NADA, Black Book (what guide dealers use will depend on your geographical region) retail and their "slashed" liquidation price. Not just some bogus reduction in monthly payments.

I'm in Arizona and my dealer will have these types of sales from time to time. Trust me the guys and gals that fly in from around the country to pay their own way staying in a hotel for a week, are not here to enjoy the beautiful Arizona desert, and the 120 degree heat in the summer. They fly out here to try and make $5000 - $6000 for the week and then they're off to where ever they came from, to spend your hard earned money.

By the way, my dealerships average profit, during these sales, is $4400 per vehicle. I don't know about you, but that doesn't sound like much of a bargain to me.

A lot of times during these sales events, there will be incentives like mailers with keys to new cars in them. All you have to do is go down to the sale and if your key starts the new car you get to drive off in it. Well, guess what? The key that starts that car is mailed out all right, so they can stay legal, but it's usually mailed seven states away. So please don't fall for that one.

To quickly sum this up, when you hear of one of these sales events, STAY AWAY! Trust me, you'll get better service and a much better deal visiting a car dealership on some random Wednesday night closer to the end of the month, then you will at one of these price gouger sales events. If you're one of those people that just has to know if that key will start the car, just don't say I didn't warn you about the three ring circus you're about to walk into.

Avoid sales like this. Use a site like CarsDirect, and their new car buying service. They'll quickly show you MSRP, Invoice and their guaranteed low sales price for the vehicle you want. It's a very easy site to navigate and there are NO sales people to deal with!

You'll also find a huge array, I believe it's close to two million used cars there. In addition, the car dealerships that advertise their used vehicles are screened by CarsDirect, and if they pass they are labeled with a "trusted" logo. Each dealership assigns a specific person(s) to be the CarsDirect contact person(s). Trust me this person will treat you right. They are not going to risk losing an account as large as this one.

There's also sites like Edmunds.com where you can make new and used car inquiries, and you'll find a wealth of information when it comes to research.

In the mean time...

Take care and beware!
J the Car Guy

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Car Buying Tip #1 - 8 Essential Steps For Buying A Car

#1 Congratulations! You've completed step #1 by finding my blog and hopefully you will use the blog if you need advice or tips straight from me. That was easy!

#2 You must know you're credit score. If you don't know your credit score and what's on your credit file, it'll not only make selecting the appropriate lender for you more difficult, but it could lead to a costly surprise (High finance rates) when it's time to buy. A $20,000 loan for 72 months at a 6.9% APR has a monthly payment of $340, which fits into most peoples budgets. On the flip side, if you thought you'd qualify for the 6.9% rate, but it actually turned out you qualified for a 18.99% APR, you'd be looking at a $467 payment. Surprise!
Get your credit score here Fico Scores/Reports and remember Higher FICO Scores = Lower Monthly Payments.

#3 You must get Pre-Approved. Now that you know you're credit/FICO score, you definitely want to get pre-approved for an auto loan. Getting pre-approved gives you the ability to "Buy Like a Cash Buyer," which greatly increases the leverage you have when negotiating the best possible deal. I recently observed the last 40 deals at my dealership, and found that cash buyers saved over $2500 per car deal, compared to those that financed. If that's not a call to action, I don't know what is!

Check out the Loan Center, to see which lender is the best fit for your credit score and credit tier and apply today, they're fast, easy and FREE!

#4 Start your shopping online. You must not walk into a dealership and have no clue what average prices are for the new or used vehicle your considering. Most people that do walk into a dealership with no clue what the true value of the vehicle is will get caught up in the emotion of the moment and pay way more then they could have. Get a whiff of that new car smell and you're taken away to a distant, far away place...I'd personally suggest that you find your next vehicle online. This saves a ton of time not having to go dealership, to dealership, to dealership, increases your leverage in a big way, and will typically save you money right out the gate, because it's so competitive online.

If you're looking for a research site, I'd highly suggest Edmunds.com. They are one of the largest car buying informational sites out there. You can find dealer invoices for most all new vehicles, and inquire about vehicles online.

My favorite site for buying new cars and searching for used cars is CarsDirect. They offer a car buying service, and guarantee the lowest prices for new vehicles. They will show you MSRP, dealer invoice, and the CarsDirect price. With this service, it allows you to bypass car dealers salesmen and buy a vehicle with none of the sales pressures you'd normally find at a dealership. Try it, I'm sure you'll like it.

#5 You must know what your trade in is worth. Check out sites like Kelley Blue Book (KBB.com), or NADA (NADA.com) to get a good feel for what your trade is worth. Keep in mind both of these sources are simply guides, and are not set in stone values. For instance some vehicles may be "soft" (not worth as much as it's book value), like a truck with a V10 engine. With gas prices where they are at a V10 truck that has a book value of $20,000 may only be worth $12,000 to $14,000. What? That's right. If a dealership were buying a V10 truck with the intention of reselling it, they'd have to be in a position to sell it quickly, or else they risk it collecting dust on their lot for the next year. People aren't exactly jumping through burning hoops to rush out and buy 6 MPG trucks with the current gas prices.

If you need additional help with determining your trades value to a dealer, please get with me and I can help. By the way, you'll need to expect to get less trading your vehicle in to the dealer than selling it on your own. If you'd like to get maximum value for your vehicle try to Sell your car on Cars.com: reach 65% of online used car shoppers. They have great reach and you'll more than likely sell your car fast and often make thousands more.

#6 Get insurance quotes. I can't even begin to tell you how many customers I've seen go through the whole buying process (usually hours), get all excited about their new vehicle, maybe agreed to $50 a month more in monthly payment, because they had to have that one, and then they call to get insurance quotes.


Two words, Big Mistake! Using the same scenario above, the customer is already paying $50 more a month than they had figured and now they call for insurance only to find that their insurance is going to go up another $60 a month. This can be disastrous to your financial future!

Remember there is more to car payment than the actual car payment itself. Get insurance quotes before you ever go to the dealership. It's FREE, and doesn't affect your credit, so let the insurance companies compete for your business.

Check out the Insurance Review for fast, FREE quotes, or check out two of my top preferred companies Esurance, or 21st Century Insurance, both could save you hundreds on insurance.

#7 Talk to me. Now that you've got all your ducks in a row, get with me and let's structure a deal that will save you thousands, and make this the best car buying experience you've ever had.


#8 Be Prepared. You've done your homework, you've talked with me and now it's time to head to the dealership. You must bring printouts of invoices if new, book value if used, your trades values, a copy of your pre-approval and any other supporting documentation.


When a dealer see's you walk in with all this information, they're are going to know that you're not to be messed with, and more than likely you'll cut a lot of time of the negotiating, because they'll know you know what to expect and won't fall for a lot the hype.

If you really want to chap their hides, bring a financial calculator, and use it when they present numbers to you...Car salesmen love when customers do this (sarcasm).

Take care and beware,

J the Car Guy

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She's doesn't make $17,000 a month

Sorry for the bad information, the credit application was filled out wrong...Upon further review she makes $31,000 a month! Crazy. She's never worked a day in her life and probably never will. She'll have that money coming in for the rest of her life...Must be nice.

J the Car Guy

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20 yrs old and she makes $17,000 a month

Quick post here...I'm am trying to get an approval for a 20 year girl and she makes $17,000 a month. I'm not going to get to personal about her, but I've seen her tax returns and a paystub, so unless she is really at faking paystubs it's real.

WOW! Sign me up for that job...

In the mean time...

Take care and beware,
J the Car Guy

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The owners are here, the owners are here...

What a bunch of money grubbin', holier than thou, sons of guns (would have used another word, but trying to keep this PG) fly down here in their private jet and want to raise a stink about the numbers...I've got two words for them - Pound Sand! It's their fault that the numbers are so off. It's sort of hard to sell a bunch of vehicles when they're hardly keeping any vehicles on the lot. If you want to sell 200 cars a month it's not gonna happen with 100 cars for sale.

By the way, I posted this just to give an idea of some of the pressures in this business and how ridiculous some of the demands are. This is by far the least pressured job I've had, but it's still frustrating to get scolded by someone, when all I can think about is how the heck they were able to make enough money to buy a dealership in the first place. Oh yeah, I remember, daddy bought it for him. Now it all makes sense...

In the mean time...

Take care and beware,
J the Car Guy

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Starting off to be another crappy month!

Cash, Cash and more Cash...I hate it! Not only can I not make a living with these s***ty cash deals, it's boring the hell out of me. I'm a sub prime finance manager and can't stand this. A well trained monkey could do my job right now. All it is is print and sign...I wish these snow birds would leave and go back to Canada, Minnesota, or where ever they come from, it really makes my job very unfun.

If you've got bad credit, this is the place to get some guidance. I'm pretty proud of my accomplishments, and at my dealership there is nobody that I can't get an approval for.

Let me know how I can help!

In the mean time...

Take care and beware,
J the Car Guy

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Where's my extra set of keys?

Tip of the day here...Please get everything in writing and don't wait 8 months before getting something a dealership promised to you handled.

The reason I write this is a customer that bought a car back in September is just now calling in saying that we owe her a second set of keys. What? You've got to be kidding me! You think we owe you keys from 8 months ago? There is nothing in writing and it took 8 months before she got around to asking us. What a joke. Unfortunately, it happens often.

Just to give an example of how mixed up this lady is, she thought I sold her the car. I don't sell cars! I'm the finance manager. Even if she was verbally promised keys, she shouldn't have waited 8 months to ask, because nobody even remembers her, let alone what might have been promised during negotiations. Even if she had something in writing, a We Owe is only good for 30 days.

Needless to say, she's not getting an extra set of keys! If she wanted the keys, she should have got it writing and followed up just a little bit (like 7 months) sooner. I'm sorry if this seems like a bit of a rant, but I can't stand when customers do this. She'll probably get po'd when we tell her no keys, but honestly who's to blame here?

I've even had customers call in close to a year after the sale and complain that they need new brakes and want the dealership to pay for it. Again, What? This guy was in the tile business and hauled heavy loads all the time and expects his brakes to be covered for life...Please be sensible when it comes to these things, and definitely get everything in writing.

In the mean time...

Take care and beware,
J the Car Guy

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Cracked!!!

My car dealership just sold a truck and the customer got "cracked!" They made over $7,000 and everyone here is happy...You must educate yourself before you buy a vehicle. I say this, because these people will make an extra years worth of payments at roughly $40 per month more (for the entire 72 month contract) then they could have.

By the way, I wouldn't blame the dealership for charging too much, that's just what dealerships do. You need to understand that if you allow a car dealer to make money, trust me, they will make as much as possible.

You need to read some of my car buying tips, or else you might be the next victim. I'll will be adding more of my car buying tips today, hopefully three, and I have currently 26 total, so stay tuned for more.

In the mean time...

Take car and beware,
J the Car Guy

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It stinks to be a finance manager! Sometimes...

We're now at the end of April and My dealership will finish the month with a little over 50% cash deals. For a Finance Manager that is a really bad situation. We make our money securing financing and selling warranties, and cash customers are a tough sell.

When I took this job it was to be a bad credit specialist and to help customers with bad credit get approved for loans, but apparently my dealership is asleep at the wheel, because they are not buying the right inventory, and have not been advertising right.

I may be writing this blog from a new dealership soon. I'd prefer one that actually knows what they are doing with regards to sub-prime credit.

Sorry for the rant, but I'm a little disgruntled with this place. That's why I created a blog...to vent! Actually, I created this blog as a place to "spill the beans," and help consumers in need, but to be able to vent is a nice side effect.

I've now transferred all my posts from my old blog, that might be of interest, and all I have left to do is post all of the car buying tips. I currently have 26 in all, so keep checking back, this blog will always be updating.

Feel free to start asking some questions, now consumers don't have to email me like they used to with that other worthless blog I had.

Look forward to hearing from you.

In the mean time...

Take care and beware,
J the Car Guy

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Hi All. Sorry for few posts, but it's been deader than a door nail. We usually slow down a bit after a sale and I'm not working at as large a dealership as I'm used to, but this is ridiculous! By the way, the dealer I work for sells about 100-125 vehicles a month, and we've only made a hand full of deals these past few days. I don't know if it's the economy or what.

I'd also like to apologize to any of you that came to the site this morning and saw the utter chaos that was going on. I had revamped the home page and things went wrong so it took much longer then expected.

Good news! I inked the deal with OwnerGuard GAP and will be offering their product shortly. I've only seen one company online offering GAP Protection and they wanted $399 for GAP. That's better than most dealers charge (usually $495 on up to $795), but OwnerGuard is going to kick the pants off both of them. I should be able to offer it as low as $265.

I also signed with DriverZedge and will be making their extended warranties available soon. That will be great because I can complete the warranty review page on my www.automalladventures.com site. By the way, for the niche that DriverZedge will fill, I know they will blow away the online competition, and it's the same company I use at my dealer, so I know how they work.

In the mean time...

Take care and beware,
J the Car Guy

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Big Sale is Over

Well our Big Sale ended Saturday, and the volume was well below expectations. As with most of these Big Sales the Gross Profit per sale was pretty big. I think the final numbers were at $4600 average per deal. I'm going to say it again, buy a vehicle at one of these sales events and they'll stick it to ya'.

I personally don't mind when I buy a vehicle and a dealer makes a little money, but $4600 is pretty ridiculous. I guess that's to be expected when people don't educate themselves prior to buying.

I'm sorry I wasn't around for a couple of days, but clean up after the sale takes awhile. I have to get all the required docs for the lenders, package the deals to send to the lender, etc.

It's been funny though, it's like someone turned off the faucet. The sale ended and the dealership might as well be a ghost town. This whole economic down turn stinks. I hope we can pull out of this sooner rather than later.

I'm excited to say that I've begun some of my advertising, and so far the results have been great. Thanks to all who've dropped in. Please do not hesitate to contact me if you've got any questions about your upcoming purchase.

In the mean time...

Take care and beware,
J the Car Guy

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Little Old Lady Wins

I love it! They tried to push, pull, and lean on her to buy now! She didn't! She stuck to her guns, and at one point straight told the closer to back off and not push or it'd be the last he saw of her.

She also told him that she didn't get to point in her life where she could pay $25,000 cash for a car by making spur of the moment decisions. Very smart. Don't rush into buying a car. I know it can be very exciting and the Earth would cease to revolve around the Sun if you backed away, came back the next day and the car was sold, but you simply can't make rush decisions with a purchase this big.

One thing I can say for sure is that the manufacturer will certainly make more cars for you to buy. If you don't like the way the negotiation is going, or you feel pressured, back away and give yourself some time to think away from the dealership, or else you could regret your decision in the morning.

By the way, when you buy a car from a dealership it's not like buying something from JCPenny's, where there is a no questions asked return policy. Once you sign that contract and drive off the lot, you own it.Take your time when buying and evaluate the situation carefully.

In the mean time...

Take care and beware,
J the Car Guy

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Not a Bad Finish to the Day-For the Dealership!

Wow! All day yesterday, we really had nothing special going on. Low and behold, of course about the time to go home, I get slammed with 5 deals all at once! Of course, every customer was in a hurry to leave, so it got a little hectic, but manageable.

They did average about $3800 per deal, and the winner was the one cash deal we had. The dealership was only able to make $1300 from her. I know I'm probably beating a dead horse here, but you've got to get pre-approved for your auto loan.

I don't think she really did anything special during negotiations, but having cash, or the cash equivalent (pre-arranged financing) gave her a huge edge and she saved over $2500 compared to those customers that financed. Of course, you can ignore this advice and not go to the loan center for pre-approval and you can make payments on the additional dealer profit of $2500 for an extra 12 months, but that's up to you.

In the mean time...

Take care and beware,
J the Car Guy

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You Ripped Her Off!

We had a customer that bought a vehicle yesterday, and her neighbor called today saying that we ripped her off and paid to little for her trade in. They wanted to take the trade out of the deal, so they could buy it for the same amount. The customer had gotten all worked up about this from her neighbor and wanted explanations.

First off, if the neighbor thought we had ripped her off and was willing to buy the vehicle for the same amount, doesn't that mean the neighbor wanted to rip her off? I don't know what you think, but it sure sounds like it to me.

Second, by trading in her vehicle and receiving the tax savings on her new vehicle, she actually got an extra $412.50 by trading it in.

Third, my manufacturer that I work for has a competitors trade in rebate of $1000. In other words if you own a Dodge and trade it in on a new Ford, Ford will give you a $1000 rebate. Don't trade it in and you lose the rebate.

Fourth, we haven't even seen her trade! That's right we made a good faith buy bid based on never seeing the trade. We gave her $5500 for her trade, which is fair market value, she also received the $412.50 tax savings, and a $1000 rebate. By trading she actually recieved a $6912.50 value for her trade in, as opposed to the $5500 her ripoff neighbor was offering.

The ripoff neighbor is no longer calling and the customer is satisfied, and not overly happy with the neighbor that whipped her into a frenzy.

I guess the moral of this story is not to get advice from people that don't know all the facts, and have no real knowledge of the situation you're in. It's certainly okay if someone is trying to help you, but don't let them fool you into thinking they're an expert because they've bought a car or two before. An easier way to say this: Would you go to an Attorney and ask him to diagnose the pain you're having in your stomach? Of course not, you'd go to a doctor that specializes in stomach disorders.

I guess this is like this site, would you rather take advice from some self proclaimed "Car buying expert" online, that's never worked a day in the car business, or from someone that, still to this day, works in a dealership and is willing to spill the beans to you about what goes on behind the scenes? You decide.

In the mean time...

Take care and beware,
J the Car Guy

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Lots of Negative Equity

Well this super sale is dragging on, and on, and on...The best way to sum this sale up is that my dealership dropped the ball and didn't get me the inventory I need to do my job, and negative equity stinks if you're the one stuck with it. This whole sale has been about people 8, 9, and 10 grand flipped in their trades. By the way, flipped, buried, and upside down are all ways dealers describe negative equity in a customers trade.

If you're in this situation, it typically takes above average credit, or a large down payment to get out from under negative equity. The reason being, especially in today's economy, lenders just won't lend endless amounts of money based on the value of the new vehicle you're trying to purchase. I guess this is just a little heads up for those of you in this situation.

Really what this comes down to is customers overpaying for vehicles in the first place, and buying vehicles that tend to depriciate quicker than others. I personally lease if I'm going to buy new. I figure I'll always have a car payment, so why not drive a new vehicle every two years, and not worry about negative equity. A lot of people don't like to lease, because they think they are losing some ownership rights, but realistically, when you finance you don't "own" the vehicle until the last payments made anyway.

The average trade cycle is between 29 and 36 months, I guess we get bored easily here in America. My point is, please consider this before you get locked into an 84 month finance contract, most people will not keep a vehicle seven years, and that probably includes you too.

All the above is extremely important to keep in mind if you're buying new. Did you know a rough average for depriciation on new vehicles is 20-25% your first year, another 15-20% your second year and your third year is about 10-15%. OUCH!!! Buy right upfront and save yourself from the pain.

I really like CarsDirect buying service. They show you MSRP, invoice, their price, and they guarantee the lowest prices. You also don't have to work with car dealership salespeople. Try it out, I think you'll like it.

In the mean time...

Take care and beware,
J the Car Guy

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