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An enormous portion of the American economy is based on the automobile. Making cars, selling cars, repairing cars, financing cars, and then junking the cars.

What is especially interesting is that virtually the entire automobile-related economy is based on trying to cheat the consumer.

You, the consumer, are prey to the economic engine of the automobile. Yet, you have to have a car to get to and from work so you can afford to pay for the car. Thus, you have to buy the damned things. Based on personal experience, consisting of having lost tens of thousands of dollars in car deals, is the basis to provide you with this most helpful to buy a car and make the car dealer really happy.

The first order of business is to tell the car dealer salesperson (who usually does wear white shoes) that you have the ability to spend $500 a month on the car. You will only be shown cars that cost $500 a month, for the rest of your life.

Very early in the negotiations the car dealer will want to run a deal through the banks to see if you can afford $500 a month. Comply instantly. Often, the credit report will come back showing that you really could spend $600 a month on buying a car. You will then only be shown cars that will cost $600 a month (but they will have genuine Corinthian leather interiors).

However, if your credit report shows that you will only qualify for a $400 a month car, you will suddenly be shown smaller cars.

Most car buyers want to test drive the car. While this is fun, especially if you like to speed up to 90 mph and then slam on the brakes to see if they work, a serious advantage can be granted to the salesman buy saying you don't want to test drive the car. This way, you can be sold a car that only turns left, and not right.

Let us assume you really want a white car, but the dealer doesn't have a white car. You will find out all the disadvantages of owning a white car (whatever they may be), but the black car is much better. In Arizona, black cars heat up in the summer and turn into furnaces. But they will really look nice in the winter.

Cars always have stickers on them. Agree immediately to pay the sticker price, including the undercoating the dealer never put on. The salesman will really warm up to you, and might even offer you a free dinner at a cheap restaurant for not dickering over the price.

If you chose to negotiate, you will often find some special program exists that reduces the price, but only if you finance the car through the dealer's bank at a much higher rate of interest than you could get from the same bank if you called them yourself. A dealer can actually sell a car "below cost" as long as the financing part of the deal gives the dealer lots of interest income.

Then comes the trade-in negotiation. Avoid checking out the classified ads to see what your trade-in is selling for, and never go to the Kelly Blue Book web site and find out what the wholesale and retail value of your trade-in might be (even though this is free). When the salesman offers $4,000 for your $14,000 trade-in, say "Gosh, yes." Never go back to the dealer's lot after you trade-in your car, so you can avoid seeing how much they are asking for it.

Often dealers just sell your trade-in at the local car auction. Never go to one of these, because you don't want to know what cars are really worth.

If your trade-in has a major problem, like the engine is failing, make sure you tell the salesman about the problem. Of course, if you were buying this car from the dealer, he wouldn't tell you about the problem. But fair is fair.

Sometimes you will discover that the trade-in value of your car is less than what you currently owe on the car. No problem. The dealer will just add the "upside down" number to the new car purchase price, and your debt on the old car will be transferred to the new car, along with the price of the new car. If your bank (or more likely the dealer's bank) agrees to this, everyone wins...except you.

Always have the title to your trade-in ready to sign, so you don't have any second thoughts about giving up your old reliable car for a new one.

Once you have selected the car the salesman wants to sell you (which is always the car that the dealer will make the most profit on), the contract will be presented. A car purchase contract is always very long, and in very fine print. Car dealers do not want you to read the contract. This is when they start feeding you cokes or coffee, to make sure you have to go to the rest room. It doesn't matter, the contract gives the dealer every right possible, and the purchaser none, and the contract is not negotiable.

But, there are a lot of blanks in the contract for extras, such as special protection plans. These are also major profit sources to dealers. Be sure to buy one.

If you are buying a used car, remember the words "as is". That means there is absolutely no warranty whatsoever. If the car makes it off the lot, it is yours. All used cars will be able to do this. Why worry.

Once you have bought your car, if it is new it will have a warranty. For a short while. Never long enough to match up to what you you will have to buy another car (being "upside down") and increase your debt.

Once the car is off warranty (assuming you keep it) or the car was used in the first place, you now enter the next zone of car theft...the repair shop.


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Copyright 1998-2006 by Hugh Holub