5 Tips For Single Women Buying a Car

by Linda Allen · Apr 21, 2016

The memory is still quite vivid. It should be. It was that sinking feeling I had when I got home and actually read the papers. That deal I thought I had negotiated was not at all what was on the purchase contract. I consider myself a savvy consumer, but I’d let my guard down just long enough to let an unscrupulous car dealer make me feel like a complete idiot. I’d just been had to the tune of five thousand dollars, and there wasn’t anything I could do about it. I tell the story below.

Certainly, not all car dealers or private sellers are crooks. But there are enough out there who are lacking in morals that you have to be prepared, stay alert, and double check everything. Or risk losing a lot of your hard-earned money. Here are the essential things to be aware of to protect yourself.

Single Women Buying a Car are Targets

Let’s face it, most of us are not well versed in all the aspects of buying a car. What’s a good price? Should I lease, buy, or pay cash if possible? Do I need mechanical insurance? What’s my current car worth in trade? There’s a lot to know, and a single woman is usually seen as an easy target for manipulation. As in any unfamiliar situation, it’s best to have someone with you who will watch your back, so if at all possible, take a relative or friend with you If that’s not possible, consider putting off shopping until you can arrange it. If you’re in a situation where you must get a deal done immediately, go slow, double check everything, and do your homework before you step onto the dealers lot. If you are ambitious, you can also consider taking over car payments from someone else

1. Determine Values

There are several online sources of car values. For estimates of what you should be paying for a new car, try TrueCar or Edmunds. Both offer insights as to what a specific model is actually selling for locally, as opposed to the list or “sticker” price. With that as a starting point, be prepared to ask for an even lower price. How low? What’s the least you’d feel comfortable offering? Okay, offer a little less than that. Better to have the money in your pocket than theirs.

If you have a trade, there’s also the matter of how much you should reasonably be getting for it. Warning: it’s going to be less than you think.

Dealers make huge margins on used cars, usually much more than on new ones. They’ll try to get your car for peanuts and potentially make thousands on it. According to the National Auto Dealers Association, nearly 26% of the dealers profits come from used car sales. And surprisingly, the largest percentage isn’t from new cars sales. Thirty-seven percent comes from finance and insurance products it sells you after you’ve made a deal on the car.

You can go to either TrueCar or Edmunds, mentioned above, or Kelly Blue Book or NADA and get rough ideas what your car is worth. But be forewarned: The numbers are extremely easy to manipulate. And the difference between trade-in versus retail value is huge. As an example, a 2008 Toyota Corolla LE with average mileage of 102,000 has a retail value (what YOU would pay on the lot) of $8056, while it has a low trade-in value of only $3776. Yes, do the math. Over $4,000 difference.*

And even if you come in prepared with printouts of the values, they’ll have excuses as to why they’re not valid. They’ll try to get your car for even less. What to do? Negotiate for all you can get. Be prepared to walk away. Or consider selling your old car yourself if possible.

2. Don’t Fall For the “Difference” Trick

If you’re trading in your old car, you’re actually doing two separate transactions. You’re selling the dealer yours. The dealer is selling you his. Very often, the dealer will try to focus you on how much difference you have to give. That’s the price of their car less the amount they are offering for yours. Don’t negotiate this way. Work out a price on the car you want first. When that’s settled, then work out an agreeable trade-in value for yours.

3. Don’t Discuss Down Payment or Payment

Determine ahead of time what you can afford. Use a financial calculator such as Bankrate and determine what you can afford. If your budget will buy a Honda Accord, there’s no point in looking at that fancy Lexus. If the salesman asks you what payment you can afford, be evasive and just say “I know what my budget is, and I’m looking for a (name of car) because it fits.”

Stay focused on the price of the new car and the amount being offered for yours. They’ll usually do their best to get you to view the transaction from what monthly payment or down payment you can afford. If you fall into that trap, you’re very unlikely to get a good deal. Leave those discussions for the “F and I” (finance and insurance) man, who will be your last hurdle.

4. Finance and Insurance Pitfalls

Remember the number I quoted on this? The dealer makes 37% of their profit in the little office you will be herded into after you breathe a sigh of relief thinking the worst is over. Turns out, buying a car isn’t just buying a car. The F and I man is usually a very seasoned salesman. He’ll print up the actual purchase and finance agreements. And he intends to make money on you. He’s paid on commission, just like the salesperson.

He’ll also try to sell you, among other items, upholstery protection, undercoating, serial number etching, paint protection, extended warranty protection, rust proofing and various other items of dubious value. Sometimes, they’ll automatically include them on the contract without even asking. If you don’t object, you’re making the deal much less favorable to you.

This was the area where I got had. Having followed my own rules, I’d negotiated separately on purchase and trade. I didn’t buy a payment or a down payment. I was happy with the deal I thought I had. But because I let my guard down and stopped paying attention, the actual contract was written up on a “deal sheet” that was in the first round of negotiations. Once the contract was signed, it was too late. Dealers virtually NEVER undo deals.

5. Be Mechanically Aware

If you’re buying new, there’s little to worry about. You’ll get, at minimum, the new car warranty. But if you’re buying a re-sale vehicle from either a dealer or private party, some mechanical knowledge is essential. If you don’t have it, as most of us don’t, ask for an independent inspection before you make a deal. Alternatively, bring someone with you who has a decent understanding of auto mechanics. You may not know whether the 4×4 wheels are in good shape or if the engine is about to give out. And it’s always wise to get a background check on the target vehicle, such as those offered CarFax in the U.S. or at https://www.carveto.co.uk/mot-check/checklist/ in the U.K.

A second facet to this is your trade-in. Some dealers may try to claim your car needs repairs and use that as justification for a very low value. If you know your car is a POS, that’s fine. But if it’s just time for a new ride, be able to challenge dealer claims of needed repairs.

Buying a Car Can Be a Good Experience, IF . . .

You prepare ahead of shopping time
You stay focused on each part of the transaction separately
You avoid F and I add-ons of little or no value
You negotiate each part of the deal and are prepared to walk away if it doesn’t feel or sound right.

Buying a car, especially a brand new car, can be a fun experience. Not all dealers are unscrupulous, but most use aggressive sales tactics. Remember that despite what they may try to tell you, they’re not on your side. It’s up to you to be able to wake up the next morning feeling happy about that shiny new payment parked in the garage.

*Values calculated April, 2016, at www.KBB.com

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