5 tips for negotiating with a clever car dealer

Here's how to score the best deal on your next set of wheels.

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Whether you’re planning to buy a new or used car, you can usually get a better deal by negotiating with the car salesperson. A little preparation beforehand can help up your bargaining power when you hit the dealership — or let you know when it’s time to walk away.

1. Follow the three-dealership rule

The three-dealership rule can help you find the most competitive offer on whatever car you’re interested in buying.

Simply do a quick Google search and find the closest three dealerships to your house. Pick a weekend that works best for you and make the time to go to all three of them.

Once you’ve gone to all three dealerships, you’ll have a good idea of which one has the best deal on the car you’ve already researched online.

2. Shop near the end of the month

Salespeople have monthly targets, and they’re sometimes willing to play ball and lower the price to hit those targets near the end of the month.

But don’t wait until the very last day of the month. Some dealerships have fiscal months that end a few days before the calendar month, and salespeople might hit their targets a few days early. Instead, aim for shopping a few days to a week before the month ends for the best chance at a killer deal.

And for the absolute best deal, shop near the end of December, when salespeople are trying to get rid of old models and hit both yearly and monthly goals at the same time.

3. Get pre-approved for a car loan before visiting the dealership

Dealership financing is convenient, but it’s not always the best deal. Before you drive away with the car of your dreams, take the time to compare your options and see if you can get a better deal from a bank, credit union or online lender.

Not only can a third-party lender offer a better deal in many cases, but getting preapproved with a few lenders before you visit the dealership also puts you in a better position to negotiate both your car’s price and your interest rate.

Compare car loans

Name Product Min. Loan Amount Interest Rate Fees Loan Term Min. Credit Score
Car Loans Canada
$7,500
3.99% to 29.90%
Varies by lender, loan type and province
12-84 months
300
Search thousands of vehicles online, including $0 down options, from dealers across the country and get matched with affordable financing options. Auto loans are also available to those with bad credit, consumer proposals and bankruptcies to help rebuild credit.
CarsFast Car Loans
$500
4.90% to 29.90%
Varies by lender, loan type and province
12 months - 8 years
300
Browse thousands of vehicles from dealers across Canada and get matched with financing that meets your needs. Apply online to purchase a new or used vehicle and get the vehicle delivered to your door.
LoanConnect Car Loans
$500
1.90% to 46.96%
Varies by lender, loan type and province
6-60 months
550
Get access to 25+ lenders through LoanConnect's brokerage. Receive pre-approval in as fast as 60 seconds and get your funds in as little as 24 hours.
Carloans411 Car Loans
$500
1.90% to 19.99%
Varies
Up to 84 months
300
Get connected with suitable lenders through CarLoans411. Finance your next car, van or truck with loans available in amounts from $500 to $35,000. Check eligibility for this loan through LoanConnect.
Auto Arriba Car Loans
$3,500
8.99% to 29.50%
Contract fee of $499.00
6-84 months
N/A
Auto Arriba offers car loans starting at $3,500 up to $100,000, with as little as a 30 minute loan turnaround time. On a limited number of approved loans, Auto Arriba is currently offering a rebate of the amount of your first scheduled payment 30 days after it has been processed up to a maximum of $500.
Fairstone Secured Personal Loan
$5,000
19.99% to 23.99%
Varies by province
3-10 years
560
Fairstone offers secured personal loans up to $35,000.
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Ask an expert: How can I find the best interest rate for my credit?

LeeAnn Shattuck

LeeAnn Shattuck

Automotive expert and founder of The Car Chick

Get preapproved for a loan through your local bank or credit union first. Then take that preapproval to the dealership to see if they can beat that rate.

You don’t have to show them the preapproval letter — just tell them the rate you’re approved for. Feel free to fudge a little and tell them a slightly lower rate to see if they can beat or match that to get an even lower rate.

Dealers have relationships with multiple banks and can sometimes negotiate better rates on your behalf.

4. Don’t be afraid to walk away

It can be tough to walk away when the dealership closest to you is offering a free window tint or stereo upgrade. But if the salesperson is offering you a car above your budget and isn’t budging, it might be time to go elsewhere.

If you think there’s a better deal out there, there probably is. And sometimes, walking away might even make the salesperson lower their offer price.

5. Be polite to the person who’s trying to sell you something

While it’s important to be confident when negotiating, people are usually more likely to do something nice for someone who’s been nice to them. Keep this in mind when shopping around and you might just find a salesperson who’ll sell you the car for lower than the advertised price.

And while walking away is sometimes the right decision, it’s not a good idea to repeatedly threaten to walk away when you don’t mean it. Walk away when you think you can find a better deal elsewhere — not when you’re trying to play hardball to get a better price.

Bottom line

Car prices aren’t set in stone, and good negotiating tactics can help you save a pretty penny. If you’re ready to start shopping, compare car loans to increase your bargaining power when you hit the dealership.

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