The Test Drive - Where You Take Control

Before you make your next new or used car purchase take it out for the all important road test or test drive. During this time you will either love or hate that new ride. The test drive is the most important part of the buying process. The time when you take control of the drive.

Have the salesperson demonstrate the location and operation of all instruments, i.e., lights, stereo, remote mirrors, steering column tilt and seat adjustments, USB port, bluetooth pairing; safety features blind spot warning, lane departure, backup camera, etc. before leaving the dealership. For safety reasons make all your driving adjustments prior to taking the test drive. The salesperson will make a copy of your drivers license and leave the copy with management. This has become a common safety procedure because of auto hijackings of salespersons while out on test drives. The salesperson will also drive the car first off the lot.

Take the test drive over several types of terrain and driving conditions. Test the cars roll in curves, how much you lean vs. the car compensating for the force of gravity in curves. Check the glare from dash on windshield. Is it distracting? Listen for wind noise around the doors, side windows, front windshield and sunroof, if there is one. Listen for road noise created by the tires and transferred to the driving compartment. Perform a high speed merge. Does the car accelerate quickly enough to get you out into traffic safely? Find an area with no cars to perform a panic stop. Does the car swerve or come to a stop in a straight line?

When driving over rough roads, speed bumps, railroad tracks, etc., do you hear any unwanted rattles, squeaks or other annoying sounds. By now you should also determine if the shoulder safety belt still feels comfortable. Did the belt rise up under your neck? If so, see if it can be adjusted from the mounting on the car’s frame. How are the seats feeling at this point? Do you need to readjust the steering column tilt? Can you see all the necessary instrumentation? If you’re into music, how is the sound system performing? Can you hear all the speakers? Get demonstration on setting up the sound system.

Pull over and let the salesperson drive for awhile and you sit in the back. Check for seating comfort, noises, head and leg room, controls that your children may operate, windows, door locks, etc. Take over driving again and this time pull into a parking lot. Test parking straight in, at an angle and parallel. Did you notice any blind spots? Could you easily determine the front and rear distances to the next car?

Your test drive should be as close to your every day driving conditions as possible. Take 45 minutes or more to really learn the feel and handling of the car. Remember, you’re going to spend a considerable amount of time in your car. So, it’s very important that you take as much time to thoroughly test the car to be sure it will meet your expectations and needs.

With the recent hands-free driving laws check connecting your cellphone with bluetooth and test making a call. That is if your car has these features.

Questions to ask the salesperson: Does this car have a donut or full size spare tire? Where are the hidden compartments for spare change, cup holders, etc.? How do I set the clock? How do I set the radio? Where is the fuse box?

Auto Residual Values

Residual value is what your lessor predicts the leased car will be worth at the end of lease term. Residuals are predicted by using actuary tables based on previous resale values of like vehicles. Some cars will maintain their value and others will not. The higher the cars residual value the lower the monthly lease payment. The higher the cars residual value the higher the end of the lease purchase option. Lessors will vary the residual value to compete for your lease business. This means that the car you want to lease may have different residual values established by each Lessor. The residual value directly affects your monthly lease payment and must be disclosed to you. In the majority of leases the residual value is also the end of lease purchase price. So, a high residual value will lower your monthly payment but it will cost you more to buy the car under the end of lease purchase option.

NOTE: Residual value will lower your monthly payment by reducing the amount of the car's value you use. Example:  Cars value is                     $10,000.00 (-) residual value                  4,000.00                                    $ 6,000.00* *Car's new value that monthly payment is calculated on.  Residual values is one of the most abused parts of auto leasing. Companies would inflate the future value of a vehicle to lower payments and be competitive. Inflated Residual Value is one of the main reasons auto leasing almost died.

Auto Dealer Incentives - The Real Way to Get the Best Deal

Auto manufacturers entice their dealer body to sell more of a particular model by offering enormous monetary incentives. These are unadvertised dollars that go directly to the selling dealer. The incentive is time sensitive based on the dealers performance against quota and vary by region and model.

 Makes you want to run right out and buy a car doesn’t it?

As a prudent shopper you can begin to see why the "best deal" is such an elusive animal. Unless you truly study the market, live in the right region, pick the right model and buy during the designated time frame from the dealer that meets quota you really don’t have any chance of beating the system.

The car dealers potential loss of huge incentives are a major reason why several people can buy the exact car from the same dealer and get different prices. Some dealers are more willing to pass along a portion of their incentives to further reduce your price to earn your business. If you negotiate a great price and get the manufacturers rebate and before you walk out the door the dealer offers you further discount, you’ve done a good job. Now, do you really only want $50 over invoice? Don’t expect dealers to give you all their incentive dollars. That’s like giving up your Christmas or performance bonus.

Keep this thought in mind, car dealers are in business to make a profit. They should be allowed to make a profit. But, you don’t want to be the one they make all of the profit on.

Questions to ask the salesperson: Does this model have a dealer incentive? If so how much? When does it expire? How close are you to meeting the qualifying quota? Did you meet quota last month? Which models have a manufacturers rebate and dealer incentive?

Are Car Salespersons Better or Worse?

If you want to see if you have the mettle to survive in sales try selling cars. Not only are you up against a more knowledgeable, sophisticated and intelligent car buyer you’re also matching wits with management.

                                                                                          

Turnover among car salespersons is over 50%. The work days are ten to twelve hours, work week is 6-7 days and filled with hours of idle time waiting for a customer to come in or call. Commissioned sales is the staple pay plan for car salespersons and the pay plan changes at management’s discretion. If you don’t sell you don’t get paid. Rarely will a buyer come back to purchase so making the deal today is the standard order of business.

Car salespersons are the butt of numerous jokes and the position is not one a person aspires to become. Jumping from one dealership to another is a common practice with car salespersons because of pay plan and management changes.

Even under all this adversity car salespersons are getting better at their jobs. The NADA ( National Automobile Dealers Association) has established an excellent sales training and certification program to better prepare the salesperson for the rapidly changing auto industry. Manufacturers provide satellite transmitted product training courses directly to the dealership. Online and computer program are also provided by the manufacturers to dealerships to assist in salespersons training.

On site and off site seminars are provided by special finance companies, leasing companies, and computer hardware & software providers to keep the salesperson abreast of these companies’ products and services. Consultants are brought in to enhance the salespersons people and interpersonal skills. iPads, tablets, laptops and smartphones are the the new tools of the salesperson.

Training today’s car salespersons is taken very seriously by dealership owners. Owners are acutely aware that the new type of car buyer is not going to tolerate the sales tactics of the past. Often middle management at the dealership forgets the owners’ desires because of the everyday pressures to produce. The car business is very competitive and there are millions of dollars at stake each year.

The car salesperson is a pawn in the sales process. Seldom will management give the salesperson the autonomy to sell cars the way they know is right. So, if you come across a salesperson that seems to be from the old school more than likely it’s a function of that dealers’ unchanging management style.

Today's customer is better prepared, more knowledgeable and less likely to except less than superb treatment from a salesperson. Customer satisfaction during and after the sale is #1 priority.

Questions to ask the salesperson:  What type sales training have you completed? How long have you been selling cars? How long have you been with this dealership?

The Credit Report - Is it a Real Reflection of You?

The single most critical document used to determine your credit is your credit report. It's also the most abused source of information. Is your credit report an accurate reflection of you and your buying habits? More important, is it a true reflection of your past debt payment record?

With identity theft on the rise you may want to review your credit report every six months.

There are 3-4 major credit bureaus that businesses report your payment history to on a monthly basis. How your credit history is reported will make the difference between your getting a new or used car loan as well as at what interest rate. Your credit report determines if you are a very good or very poor credit risk. All that's needed to access this information is your social security number.

Some of the information listed on your credit report is: name of business that extended you credit, date opened, date closed, type account, terms, high amount loaned, balance, amount past due, payment profile, inquires from other businesses, ex-spouse accounts, judgments and dispute comments. As you can see if you don't know what's on your credit report you could be denied a car loan because of inaccurate information.

Within the volumes of information being sent to credit bureau's daily costly mistakes can be made. Computers make it very easy for auto dealers to access your credit report while you sit there or you're out on a test drive.

If you're refused a new or used car loan the lender is required to send you a letter of denial. This letter lists the name of the credit bureau(s) that provided your credit report. The salesperson will not and should not discuss the specific reasons for denial with you.

Under the Fair Credit Act you are entitled to a copy of your credit report. The report is free if you enclose a copy of the denial letter. You may also request a copy by calling the credit bureau and pay their fee.

Before going to purchase your new or used car get a copy of your credit report and review the information for accuracy. There is a dispute procedure outlined on the back of the report. You should review your credit report yearly.

It is not wise to visit several dealerships and let them run credit reports because numerous inquires are not looked upon favorably by lenders.

Questions to ask the salesperson: At what point do you run a credit report? If I give you a copy of my drivers license will you run a credit report? Do you run credit reports without written permission? What credit bureaus do you use?

Can you really use the Web to buy a car?

The internet has the most comprehensive collection of automobile information than any place in the world. You have instant access to practically every auto magazine, auto manufacturer, used car auctions, crash and safety information and auto dealers.

The only thing you can’t do is take a test drive.

The internet is an auto buyers dream come true if you’re the type that wants all the facts and figures before you go to buy. Let me walk you through a fact finding adventure for the car, truck, van or
minivan of your dreams.

You can start by going to the web site for Kelly Blue Book to get your dealer invoice and resale value. Then you’ll click to the National Institute of Transportation and Safety to review crash test results and other safety issues pertaining to your automobile. If you want to know how Consumer Report rates your automobile jump to it’s site and from there select your favorite car buff magazine to get it’s road test results.

You are now ready to pick up a brochure so just hop to the manufacture’s web site and read all about your dream car, with pictures, all in the privacy of your home or office. Have you noticed you haven’t been harassed by a salesperson?

Now you want to know the closet dealership to you. From the manufacturers site you will click on Dealer Locator and instantly get the dealership information.


If the dealer’s web site was properly designed you could search their new and used car inventory to find your car and get the dealers selling price or spec out your car and request the price. You found it, you like the price and you want to buy it. You’re at the moment of truth. Do you really want to visit the dealer? Just send an email and ask to have it delivered.


You can also complete a loan or auto lease application to get approved for financing from several lenders web sites or on the dealers.

As you can see you really can use the internet to buy your next dream car. But you still cannot test drive it.

Questions to ask the Cyber- salesperson via email: Will you deliver to me? Does this price include all costs except tax, tags and titling fees? How do we dispose of my trade?