Sunday, June 27, 2010

Cheap advertising tricks ...

If there is one thing I hate, it's phony, cheap advertising tricks, like the current "half off" sale that we are seeing on TV right now. I saw the ad again, at the beginning of the Loudon races (which my boys are enjoying too).
I went to the site to check it out and what it is a half off the MSRP lease price for 36 months, plus a $2,999 down payment.
As everyone knows - or should know by now - leases are a rip off. You pay top dollar for the car and then, at the end of the lease, you get nailed for more than you would have paid by buying the car, with more payments. So, this sale isn't half-off at all - it's just another car advertising scam.

If you're looking for a new car, here's what you do:
1) Go to Consumer Reports and look at the best recommended models for what you want. You can trust their reports. I always advise people to stick with Hondas. But there are other brands that are pretty reliable.
2) Go to and look up the invoice price. "Experts" say that if you pay 3 percent above the invoice price, you're getting a good price. I have always paid less than the invoice price.
3) Go to the dealership and offer to pay the invoice price for the car you want. If they balk, you walk. Don't give in; don't go up. Just wait for them to say OK. Trust me: Times are tough, they won't let you walk. Never ask desperate or anything. Do your homework and you'll be OK.
4) Other tricks: Shop towards the end of the month, when sales folks are hungry to make their quota for the month and never buy at the beginning of the month. Always shop late into the model sales year for what you're looking for, i.e., now is a good time to buy 2010 model years even though they have been on the lot for six to nine months. 2011 models are coming in to the dealerships. They have to move those cars. Lastly, never buy the latest model year right away and if it is a redesigned model, don't buy that year either. Wait a year and let the manufacturer work out the complaints and kinks.
5) The dealership may try to sell you an extended warranty. I have always heard bad things about extended warranties. Most "experts" advise not to buy it. Because of this, I've never bought them.
However, I bought one on my latest car after the finance guy made a pretty good pitch to me. The interest rate was lower on the car (2007 Honda Civic) if I bought the warranty. The cost of the extension - $1,500 - was about $120 in total cost when I added in the savings of the lower interest rate. I have already used coverage on the extended warranty for a repair that would have cost me $1,300. In other words, the extra $120 saved me more than $1,000. Or, the extended warranty was more than worth the price. YMMV.

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