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Junior Member
Posts: 21
Reply with quote  #1 
  • Where can I get the best financing deal for a new car and what is the best option, go to a dealer, bank or a credit union? I want to make sure I get the best deal and don't get ripped off. Also, what is the best thing to do with my old vehicle?

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Senior Member
Posts: 992
Reply with quote  #2 

To calculate the price of a car you need to know:

Selling Price

CA Sales Tax

CA License and Registration Fee

(See CA DMV site, just give it your best guess on price and you will get close.  Sales Tax varies by zip code. I believe you pay sales tax and registration before the rebate (bummer).)

Delivery Charge

Trade In (reduces -price)

Cash Down (reduces price)

Rebate (factory to customer or factory to dealer) (reduces price)

Documentation Charge can be quite helpful with pricing.  Make sure you know the destination charge.  Carsdirect bundles it into the price automatically, but the car dealer is sure to add it as an additional line item.  Don’t offer them a price including delivery only to have them add it in again.  Destination charge is down toward the bottom of the page so you may need to scroll down.

Car dealers will intentionally try to make it impossible for you to do this calculation correctly.  This is intentional.  They are assuming you will bluff like you can do the calculation in your head.  I bring a laptop with an excel spreadsheet to do the calculation.  The car dealer first quoted me a difference after trade in figure and I responded with a difference after trade in figure, which sent him scrambling to try and figure out what price that was.  I ended up paying $7,000 less than the first price I was given.  I always pay cash.  If you are buying on payments, bargain the price first and don’t talk payments until you have it. 

They will almost always go through three rounds of price negotiations.  So offer invoice or $1,000 below invoice for your fist offer.  They won’t accept it.  If they ask how you got that say some BS like “I know a guy in the industry and he told me.”  They keep secrets from you.  Turnaround is fair play.  Come up $1,000 the first time, $400 the second time and $50 the third time.  Come up with something ahead of time.  Bring some work with you and do it while they keep you waiting.  Keep them waiting while you finish up that page. They are counting on your impatience to increase the amount you will pay.  If you know the payment, interest rate and term, the monthly payment is a fixed mathematical calculation.  They can’t “help you with the payment.”  They can just add another year or two to the term, which brings down the monthly payment.  Note how the monthly payment goes down with term.


Monthly Payment per $1,000













































The finance and insurance guy will slice you up like a fish at the fish market.  Before you go in decide whether or not you want an extended warranty, insurance, undercoating, fabric protection or any other nonsense.  The F&I guy offered me an 8year/100,000 mile warranty on my hybrid electronics for only $1,500.  That is required by law for free.  Manufacturer financing (Honda, Ford, Mercedes) is usually quite good.  Credit Union financing is next best.  Car dealer financing is worst.  They can actually add 3% to your financing and get paid the difference by the bank (packing).  They can also call you up two weeks later and say you didn’t qualify for the loan and it is an additional 6% interest rate.  Since you have been driving the car, you will have to sell it back to them as used if you try to return it.  Avoid getting financing through the dealership.  In theory you can get a price for your trade in without buying anything at various places, but I've never actually done this.  I’ve read three or four books on this topic and I didn’t even scratch the surface.  Good Luck.


Senior Member
Posts: 2,044
Reply with quote  #3 
Here's a monster thread on Fat Wallet:

Junior Member
Posts: 10
Reply with quote  #4 
Normally, the one who accepts trade-in are the dealers.  But I suggest that you sell it by yourself so you can get more cash.  Dealers appraise them very low.  Then go to the bank and an institution to compare which one offers a lower interest rate.

Junior Member
Posts: 21
Reply with quote  #5 
Thank you for all your feedback. The thing is, I am receiving comments, like the value depreciation etc.  Well, that is how things are. I have made some inquiry to those who got credit union auto loans and they mentioned that terms are more flexible and the interest rates are lower compared to commercial banks. But I still have to check whether credit union or bank would have a better offer.
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