Negotiate a Cars Sales Price With Less Down

by Anonymous

Question: How do I negotiate a cars sales price with less down? My husband is out of work and his car can't be is too old with too many things wrong with it.

We have only so much in our savings and the 2011 Toyota Corolla we are looking at is about 17,000. Payments per month would be about $215 but we would have to put down $5,000 and pay $1500.00 for taxes and other fees.

Good news it is at a 0% financing rate. That is a lot of money to put out and I am not working for the summer as I work as a teacher's aide. The salesman talks about monthly payment rather than the price of the car. What should we do?

A certified pre-owned car would have some miles (25,000) and it is a 2009, but Toyota's hold their value, no 0% though, and he won't budge with the 13,995 price. We lose some of the warranty too with this one because of the age.

Help, we need to get my husband a car by next week. He is renting a car this week.

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Answer: Hi there. Three issues that jumped out at me right away and are going to negatively impact your ability to negotiate a cars sales price with less down are:

  1. You're looking to buy a Toyota.

    Toyota dealers are not known for giving away their cars and with Toyota's inventory in high demand and supply being limited (due to high demand, limited production and delays due to the tsunami) it will be real hard to find a "steal of a deal" with a Toyota.

    Would you be open to another brand? There are many more reliable cars with excellent gas mileage available from other manufactures.

    Toyota used to dominate in the area of reliability, but vehicles built by both domestic and import manufacturers have caught up and I'd say that Toyota's reliability over the others is now marginal at best.

  2. You are looking to buy a Toyota Corolla.

    On top of buying a Toyota you are looking to buy a Corolla which has one of the smallest mark ups of all Toyota models.

    The difference between invoice and MSRP is only $400 to
    $600. With this tiny spread there is no way for the dealer (no matter how motivated they might be) to work with you while you try to negotiate the cars sales price to thousands less than MSRP.

  3. Your husband is out of work.

    You may have already known that this was an obstacle, but I'm guessing this is why they are wanting the big down payment.

    Obviously when a buyer has no steady source of income, the risk for the lender increases and trying to negotiate a cars sales price with less down becomes more difficult.

    The lender, in your case Toyota Financial, may be looking for this large down payment to commit you to the vehicle and to limit their losses in the event they have to repossess the vehicle at some point in the future.

On top of these issues, I'm not sure if there are any credit concerns, but I'm guessing not since you were able to get approved at 0% even with your husband currently unemployed.

Outside of the unemployment issue and/or credit issues I can't see why they would need that much money down. Many salesmen are simply pre-programmed to ask for 20-30% down whether it's needed or not.

I would try to see what other dealers in your area are willing to do for you as this particular dealership may be guessing at how much down payment you might need to get this approval.

FYI - Check out Yahoo! Autos to get up to 4 competing quotes quick from dealers in your local area. You may even find the dealer you've already worked with is willing to do even better online than in person.

Did they pull credit? Did they actually submit your application to a lender?

These are important to know, because if they did not, then the likelihood of them guessing and possibly being quite far off from what you'd actually need as a down payment goes up exponentially.

Your best bet to negotiate a cars sales price with less down would be to look at other cars by other manufacturers.

You may find larger rebates and/or other used cars (non Toyota) where the dealer may have more "wiggle" room to structure a deal that you're happy with and a lender will say yes to.

Hope this helps,

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