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The $99 A Month Car Dealer Scam

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A lot of people get confused or excited when they see a car dealer advertise a $99 a month payment. Sometimes the dollar amount changes, dealers will use a $47 a month payment or some other low number. I’m going to explain why car ads that use these tricks are usually offering you a bad deal. In fact, I tell people that if a car dealer advertises in this manner they should avoid doing business with them. The reason car dealers use this advertising method is because so many people are fixated on what their monthly payment ends up being and they never understand how that number was generated.

You must understand how a car dealer arrives at your monthly payment to determine whether your $385 monthly payment is a good price or a bad price. Many people don’t understand that two people can have the same $385 payment for the exact same car and one person got a good deal, the other a bad deal! So when someone asks me to evaluate their car-buying skills by throwing out a low monthly payment I simply nod in approval just to be polite. Of course I do not know if they got a good deal or a bad deal and they usually don’t know either!

So let’s look at all the elements that make up a car buyer’s monthly payment so you can make intelligent decisions. Your monthly payment is a combination of the following: an interest payment for your loan, a fraction of your actual loan (if your loan is 48 months you pay 1/48 of the loan each month) along with any other fees or taxes you might have rolled into the deal. These are the separate elements that make up your monthly payment. So you must have negotiated a good purchase price for your car or your monthly payments will never be a good deal. This is true whether you are buying or leasing your next car. No figure has a bigger impact on your car deal than the car’s purchase price – common sense when you think about it.

Now you must take the vehicle’s purchase price and subtract any down payment or trade-in allowance. So if you are buying a $25,000 car and you put $5,000 down or give the dealer a trade-in worth $5,000 your financing figure becomes $20,000. Now we take that $20,000 and add any additional fees you might have rolled into the deal to create the final amount of money you will be financing.

When you go to financing you need to determine how much interest you are paying on the money you are financing, in our example let’s use $20,000. The length of your loan determines the number of monthly payments you will make. A common rule of thumb is the longer the loan and the large amount of money you finance, the higher your finance rate will be. So do not be afraid to ask if your financing gets better if you shorten your loan term.

For instance, let’s say two people are financing the exact same car for the exact same amount of money, $20,000. One person got a rate of 7.9% financing for 60 months. This person will have a monthly car payment of $404.57. The other person got a rate of 4.9% for 48 months. This second person’s monthly payment will be $459.68. Now remember, they both are financing the exact same amount of money, so who has a better deal? Many people instinctively would say the lower monthly payment is a better deal, I disagree. You see, the first person is paying $404.57 per month for 60 months for a total of $24,274.20. The second person is paying $459.68 for 48 months for a total of $22,064.64. The person with the higher monthly payment ends up paying $2,209.56 less for the exact same car!

Now that you understand the process you can see that anyone could buy a new Rolls Royce and have a $99 a month car payment. To accomplish this all you need to do is put about $125,000 down! Car dealers advertise $99 a month payments because they know that any potential customer who walks in the door off that ad is fixated on their monthly payment. This allows the dealer to jack up the financing rate, spread the payments out (some dealers now push 72 month loans). By hiking your rate several points and stretching the payments out an extra year or two the car dealer and the bank will make additional thousands of dollars on every customer! Don’t let this happen to you! Buy smart, don’t be fooled into judging a car deal by the monthly payment, it’s the easiest way to get scammed by a car dealer!

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Source by Richard Serge

Buy A Dirt Cheap Car From Government Auto Auctions

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Have you ever wondered how that guy across the street was able to afford that shiny Mercedes or that fully and amazingly loaded Jaguar or BMW?

Have you ever caught yourself dreaming that you are riding comfortably on a luxurious car?

Stop dreaming and smell the car wax, that auto might have been purchased in a government auto auction for almost a fraction of the car’s original value.

Ever obsessed on keeping up with the Joneses? Relax, be the Joneses for one and attend a government auto auction in your locality.

Where do the cars in government auto auctions come from?

Believe it or not, these autos auctioned off by the government come from caught criminals.

The government has always seized luxury high end cars as well as vehicles that are customized during investigations that are criminal in nature.

Some of the autos that are government-seized include BMW, Acura, Honda, Cadillac, Infiniti, Mercedes, Lexus, Nissan, Aston Martin, Lamborghini, Ferrari, Maserati, among others.

If you are the type of car buyer who is interested in an extremely high end auto, a government auto auction is great for you.

Why buy in a government auto auction?

Believe it or not, thousands upon thousands of bargains are available in government auto auctions.

Whether the car be for yourself or for a teenager who just received his license, a government auto auction actually offer the best price in the market.

Almost all models and makes are available in a government auto auction. Your dream car could actually be at hand without breaking your wallet or sacrificing your very own safety.

Just like banks, the government also wants to get rid of their inventory as soon as possible as the cost of storing such luxury vehicles are high. Just like you, they also want to save money.

As much as possible, try to save time, effort and money by not listening to a fast talking, double dealing car salesman when your could purchase on your own a luxury car where all the info you need – and probably more – is offered to you by the government.

Look on, over and under the hood. Get inside, through, over and outside the car for inspection just before bidding. You will most probably find the car you are looking for and get to live and ride for real.

All in all, a government auto auction is an answer to your prayer of having the car you have always wanted for less of its actual retail price without sacrificing quality.

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Source by Anthony Lee

Japanese Car Auction Inspection Reports Demystified

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Car auctions in Japan are a great way for car importers around the world to source good quality, low mileage cars and other used vehicles at great prices.

However, in order to make the most of the opportunities these Japanese car auctions give you as a car dealer, you have to make sure that you understand the car inspection reports. As a well-informed buyer, you can make sure you sift out the gold and avoid costly mistakes.

In this article, we will look together at who makes these auction inspection reports and what you can find in them.

If you are at at serious about buying cars from car auctions in Japan, you need to read on.

Quick Primer: What are these Japanese Car Auctions?

There are about 86 different auction locations in Japan. A typical day will see anything from about 7,000 to over 40,000 used cars and other vehicles sold at these auctions all around the country.

A good Japanese car exporter will give his customers access to all these auctions through an online system. You may be a continent or two away from Japan, and yet sit down in front of your computer and tap right into this huge selection of RHD and LHD cars right away.

Enter a bid at the click of a mouse, and let the car exporter in Japan handle the rest. A few weeks later the car will be arriving at the port for you to pick up.

Used Car Inspections at Japanese Car Auctions

Car auctions in Japan employ seasoned mechanics to inspect all the vehicles they sell. These inspectors work on site in the case of most auctions, or off site at car dealerships in the exceptional case of Aucnet.

The auction inspection covers every aspect of the car, from mechanical areas and chassis, to the exterior and interior condition. The car auction inspectors are thorough in their approach, with the only caveats being that they do not drive the car at any more than parking lot speeds, and obviously they cannot dismantle the vehicle to check out really hard-to-reach places.

The Auction Inspector’s Report

The car auction inspector write his notes on the o-kushon hyo (auction sheet). He will use a combination of scoring systems, written descriptions and a diagram of the exterior to give readers a good idea of the condition of the used car.

Overall Auction Grade

Car auctions in Japan assign an overall grade to each of the cars entered in the weekly auction.

I do not recommend that you rely solely on this grade when you consider whether to enter a bid or not. You will need to check the other detailed information that the inspector has written on the auction sheet as well.

(A good Japanese car exporter will be able to give you a professional translation of these details.)

That said, the overall auction grade has a role to play in helping you narrow down the field of potential bidding candidates. Here is a quick summary of the different grades:

Grades 7, 8, 9 or S – These refer to brand new cars with only delivery mileage.

Grade 6 – This grade can sometimes be equivalent to the grades above, but cars with this auction grade will usually have a little more than just delivery mileage.

Grade 5 – These are vehicles in superb condition, very close to brand new standard, but with several thousand kilometers on the odometer.

Grade 4.5 – A car in excellent condition, but with up to a few tens of thousands of kilometers on the clock.

Grade 4 – A good, solid car usually having less than 100,000 km on the clock.

Grade 3.5 – A higher mileage vehicle or one which will need some work to clean up.

Grade 3 – Either a very high mileage car or one which is generally rough.

Grade 2 – Very rough vehicles usually with corrosion holes being the reason for this low grade.

Grade 1 – Usually a heavily modified car which has had a different engine or transmission fitted, or which has an aftermarket turbo charger. Other possibilities are used cars with flood or fire extinguisher damage.

Grade R, RA, A and 0 (zero) – These are cars that have had some kind of accident repairs. At one end of the scale the repairs will be a single panel replaced due a minor parking ding, whereas at the other extreme there are vehicles that must have rolled in an accident which have had almost every panel replaced.

Ungraded vehicles – These are sold as-is by the auction with no or almost no information about their condition. As such they are very risky and can result in escalating additional costs if they cannot drive or move.

Some of these grades are more common than others. For example, grade 3.5 and 4 used cars will make up about 50% of any given day’s auction, whereas there will only be a handful of grade 1 cars on the same day.

Interior and Exterior Grades

Japanese car auction inspectors assign letters to indicate the interior and (sometimes) exterior condition of the car. Again, these are very broad designations, just like the overall auction grading, and it is really important to read the details of the inspectors’ comments to get a full picture of the condition.

Essentially, “B” is considered “average condition, considering the age and mileage of the car”. So an interior grading of “A” means that the interior is above average, and if it is “C” then it is below average.

The “Car Map”

This is a diagram of the exterior of the car, and is usually found at the bottom right corner of the auction sheet.

The auction inspector will mark this with a combination of letters and numbers to indicate damage to the outside of the vehicle.

Here are some basic designations:

A = scratch

U = dent

S = rust (from the Japanese word sabi)

C = corrosion

W = unevenness in the panel (usually caused by panel beating)

These letters are also usually followed by a number to indicate the severity. So “1” is the least severe, and “4” is the most severe. In practice, the Japanese are so fastidious about these things that something like “A1”, which means the smallest scratch, is really barely visible to the eye.

Japanese Car Auction Inspectors’ Comments

In addition to the above, the inspector also will write comments about the used car as he reviews it. Obviously, the higher grade the car is, the less likely it is to have extra information written about it. So a grade 3 car will have many more comments than a grade 5 car.

The exception to this can be cars that have a large number of modifications and aftermarket parts fitted that the inspector then lists on the auction sheet.

Although it may seem that the overall grade, the interior and exterior grades and the car map give you enough information in order to place a bid, I strongly advise buyers to make sure that they get these comments professionally translated before they make the final decision to bid.

A grade 5 or above car may hold no surprises, but with anything below that it is possible that the inspector has written something which could influence your decision to go ahead with a bid or not. This is why it is very important to look for a Japanese car exporter who offers professional-quality translations of auction sheets.

Concluding Remarks

Car auctions in Japan offer a great selection of used cars to source at good prices, and the auction inspection regime means that you can get a good, detailed picture of the condition of any vehicle prior to bidding.

Although it may seem daunting to be buying used cars from halfway around the world, these Japanese car auction inspection reports make the process of finding good vehicles easier and more reliable.

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Source by Stephen Munday

The Five Basic Car Sales Closing Techniques

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When you sell cars for a living one of the most common terms you will hear is closing the deal. Sometimes a successful car salesman or a sales manager might be called a strong closer or a good closer which means they are skilled at closing the deal with the customer. If you are determined to make the big money you will need to sharpen your car sales closing skills. Below you will find the auto sales closing methods and techniques that most of the other techniques have evolved from or they are variations of these car closes.

Whether you are new to the car business or have been selling for years it will help you to know these car sales closing techniques like the back of your hand. The better you know them the more you will use them and the better you will become.

Car Sales Closing – Show Me the Money

1. Assume They Are Buying: This is by far one of my favorite car sales closing methods. When you assume the sale is a done deal you naturally act and talk in a way that not only is conducive to completing the sale but the customer will pick up on you words and actions and follow along. When you move through the steps to the sale assuming they are going to buy a car at the end of the process the customer will either buy the car or they will object. If they object you then move on to overcoming their objections.

2. Ask Them to Buy: This may sound simple, but you would be surprised how often new sales people or less experienced car salesmen continue to talk about the vehicle without ever asking for the sale. However you must remember that you don’t stop asking after once or twice. Typically when you use this car sales closing technique the first thing that comes out of your customers mouth is an objection. Great, that means you are moving forward, see objections below.

3. Create Urgency: If you are in the car business, you know how important it is to sell them NOW because we all know about “Be Backs”. The car buyer has a tendency to say we are just looking or we are not in a hurry, but it is your job to get them sold NOW. Sometimes in order to accomplish your goal you need to create a sense of urgency in your customer for your car sales closing attempts to work. You want to make them believe they are going to miss out on something if they don’t buy now. An example might be the end of a sale or availability of the specific car they are interested in buying. A note of caution here: a little goes a long way and when you overdo the urgency combined with closing the sale you can come off as being pushy or as a high pressure salesman.

4. Make it Easy for Them to Say Yes: Listen to what they want and then make their wants and needs part of your car sales closing statements. Use their statements to close the deal. For example: You said wanted a red car with a sunroof and a payment under $400, right! or You said you needed a car that gets 30 miles to the gallon that seats five people that has remote entry and $5000 for your trade-in, right! Are you getting the idea now, you make it easy for them to buy a car when you have filled their needs and wants and use their words to make that point.

5. Go for the Gold – Objections: This is where the money is, it’s in the objections of your customer. When it comes to car sales closing it always comes down to objections. It is the customer’s way of saying: I am not convinced yet, I need more information or You didn’t build enough value in your product, dealership and yourself. It’s not that they don’t want to buy the car; it means that you have some work to do before they buy the car. Overcome their objections one at a time like a checklist and then close the car sale.

The car salesman will often use several of these car sales closing methods or a combination of the many other techniques that are designed to sell a car. It all comes down to closing the sale with your customer and they must be willing to buy the car because no matter what techniques you use to sell the customer they have to make the ultimate automobile buying decision.

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Source by Karl Beckham

Searching For New or Used Cars Online

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The automotive sales market has been transformed by the digital age, offering consumers the option to perform their search for new or used cars from the comfort of their homes. Performing a search online can be done in various ways. Consumers have the option to compare prices from the websites of dealerships in their area, or they can utilize one of the many used car websites, which pull from individual sellers and dealerships, as well. There are some key tips to keep in mind when deciding to purchase a vehicle online:

Decide On A Budget

Select the maximum monthly payment you are comfortable with, then filter your search to include cars in this range. Don’t even waste your time by researching cars outside of your realistic budget.

Select A Car That Fits Your Lifestyle

Too many impulsive decisions are made based on look and style alone. If you are a commuter, search for great gas mileage. If you are a parent of three children, search for more room and ample space to transport your children and their belongings.

Beware of Hidden Costs

Keep in mind those additional costs that tend to raise your final cost, such as taxes and other fees. Typically, 10 percent of the base price is a good estimate.

Decide Which Features Are Necessary

Additional features and accessories hike up the total cost of a vehicle pretty quickly. You can always add on some accessories down the road, such as a GPS navigational system or a DVD player.

Shop Around For Financing Options

Ensure you are awarded the best deal. Some dealership sites offer e-prices and specials and even allow you to apply for financing online. It is in a consumer’s best interest to shop around prior to making a final decision.

Cross-Reference Other Online Listings

For example, utilize the free estimate tools at Kelley Blue Book to determine the actual worth of the vehicle you are in the market for.

Take Advantage of Free Car Applications

Take advantage of free applications such as Carfax to run a historical report of the vehicle you have your eye on. This report displays important information including accident history and previous owners.

Research Latest News

Websites such as CarMax.com and UsedCars.com are now providing current news about scams to avoid as a buyer, as well as certified dealerships in your area.

It is reported that over 65 percent of consumers are now performing their new and used vehicle search using online search engines. To aid in this trend, free vehicle search engines are becoming more advanced and personalized, allowing shoppers to compare prices across local dealers, obtain quotes from dealers, and even to share their top choices on their social media pages, bringing their friends and family members into their decision making process.

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Source by Andrew Stratton