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10 Questions To NEVER Answer On a Car Lot (Ex-Car Dealer Reveals)
Ray Voss Car Tips
Overview
This video reveals 10 common questions car salespeople ask to gather information and influence buyers. An ex-car dealer explains the hidden agenda behind seemingly innocent questions about monthly payments, decision timelines, trade-ins, credit scores, and more. The goal is to equip viewers with the knowledge to recognize these tactics, protect themselves from overpaying, and navigate the car-buying process more effectively by focusing on the out-the-door price and maintaining control of the negotiation.
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Chapters
- Car salespeople are trained to ask specific questions to build a profile of the buyer.
- These questions are not improvised but come from a practiced sales manual.
- The goal is to understand your financial ceiling, urgency, and leverage before discussing price.
- This information is used to sell you a car at the highest price you are willing to accept.
Understanding that every question has a purpose helps you avoid revealing information that can be used against you in the negotiation.
Salespeople are trained to ask questions in a sequence to extract information about your decision-making process and financial limits.
- Asking for your desired monthly payment shifts the focus from the car's price to the payment amount.
- Salespeople can extend loan terms (e.g., to 84 months) to meet your payment number while keeping the car price high.
- This strategy leads to paying significantly more over the life of the loan.
- The best response is to focus on the 'out-the-door price' of the vehicle.
Focusing on the monthly payment allows dealers to obscure the true cost of the car and maximize their profit, leading you to overpay.
A retired teacher agreed to a monthly payment, unaware that it resulted in an 84-month loan where her balance barely decreased after a year.
- Asking 'How soon are you looking to decide?' reveals your urgency and reduces your leverage.
- Answering honestly about your timeline can signal that you are unlikely to walk away, removing competitive pressure on the dealer.
- Asking about a trade-in early allows dealers to blend four numbers (price, trade value, down payment, monthly payment) making it hard to assess fairness.
- Negotiate the vehicle price separately before discussing your trade-in.
Revealing your timeline or trade-in details too early gives the salesperson an advantage by limiting your options and obscuring the true value of each part of the deal.
A strong trade-in offer can hide an inflated price for the new vehicle when all numbers are blended together.
- Asking 'What do you still owe on your current vehicle?' can lead to negative equity being rolled into your new loan.
- It's best to let the dealership pull this information via the VIN and registration.
- Asking 'Is your credit pretty decent?' before running an application allows dealers to mark up interest rates (dealer reserve).
- The correct response is to suggest running the credit application to get an official qualification rate.
Providing information about your credit or existing loan early can result in higher interest rates and being upside down on your new car loan from day one.
Dealers can offer a higher interest rate than the bank approves and keep the difference as 'dealer reserve' if you volunteer your perceived creditworthiness.
- Asking if you've looked at other dealerships reveals your proximity to a purchase and how to approach you.
- The best response is a general 'I've done my research' without naming other stores or offers.
- Asking for the 'most' you could put down is a fishing expedition for your financial ceiling.
- Your maximum down payment should be determined after the vehicle price is agreed upon.
Revealing where else you've shopped or your maximum down payment gives the salesperson leverage to tailor their offer and potentially absorb a higher vehicle price.
If a salesperson knows your absolute maximum down payment, they can structure the deal to use all of it, potentially masking a poor vehicle price.
- The '1 to 10' rating question is a trial close to identify your objections.
- Your rating and suggested improvements reveal exactly what's needed to get you to agree to a sale.
- Asking if anyone else needs to be involved is an attempt to identify and neutralize potential obstacles to closing the deal quickly.
- You have the right to take paperwork home and involve anyone you choose; don't be rushed.
These questions are designed to uncover your hesitations and decision-making process, allowing the salesperson to preemptively address your concerns or isolate you from necessary input.
A salesperson might ask 'What would make it a 10?' after you rate a car a '7', directly prompting you to state the exact conditions for your purchase.
- The question 'What would it take to earn your business today?' sounds like an opportunity for you to negotiate.
- Answering this question means you've negotiated against yourself by revealing your bottom line.
- The salesperson can then meet your stated terms, leaving potential profit on the table for themselves.
- The best response is to ask them to put their best offer in writing.
This final question is a trap where you inadvertently give away your negotiation power by stating your terms before the dealer makes their best offer.
A buyer told the salesperson the exact price needed to close, and the dealer met that price, still leaving room for profit because the buyer negotiated against themselves.
- All 10 questions are designed to gather intelligence about your financial limits, timeline, and leverage.
- Recognizing these questions shifts the power dynamic back to the buyer.
- Key strategies include focusing on the out-the-door price, negotiating the vehicle price first, and letting the dealer pull necessary information.
- Preparation is crucial: know your credit score, decide on your target price, and get your trade-in appraised beforehand.
By understanding the tactics used against you, you can approach car buying with confidence, patience, and the knowledge to secure a fair deal.
Before visiting a dealership, get your current car appraised elsewhere so you know its true value and can negotiate the new car's price independently.
Key takeaways
- Car salespeople are trained to extract specific information through seemingly casual questions to gain negotiation leverage.
- Never reveal your desired monthly payment; always focus on the total 'out-the-door' price of the vehicle.
- Delay discussing your trade-in and existing loan details until after the price of the new vehicle is settled.
- Avoid giving self-assessments of your credit score; let the lender determine your qualification rate.
- Do not disclose how soon you need to buy or where else you have shopped, as this reduces your negotiating power.
- The '1 to 10' rating question is a sales tactic to uncover your objections, and the final 'what would it take' question is a trap to make you negotiate against yourself.
- Preparation is key: know your credit score, have a target out-the-door price, and get an independent appraisal for your trade-in before visiting a dealership.
Key terms
Out-the-door priceMonthly paymentLoan term extensionTrade-in valueDealer reserveCredit scoreTrial closeNegative equityNegotiation leverageBuyer profile
Test your understanding
- Why is focusing on the monthly payment a disadvantage for car buyers, and what should they focus on instead?
- How can a salesperson use information about your trade-in or existing loan to manipulate the negotiation?
- What is 'dealer reserve,' and how does a salesperson's question about your credit score relate to it?
- Explain the purpose behind the '1 to 10' rating question and the 'What would it take?' question, and how should a buyer respond to each?
- What are the three crucial preparation steps recommended before visiting a car lot to ensure a better negotiation outcome?