Little old lady from Antioch

My Grandmother's new car.
A 2007 Toyota Corolla LE

Gram is a very spry 88 years old. She is sharp as a tack and a wonderful woman. She also has a 1983 Ford Taurus that is leaking enough oil to cover three sea otters a day in 10W-40. Luckily the Taurus is not a boat or the EPA and Greenpeace would slap an injunction against Gram. I received a call from my mother who said I should call Gram and help her buy a new car. I did, and I did.

With a handful of sale adds from Toyota dealers in hand I drove down to Gram's house and went shopping. The local Toyota dealer, a small lot who cannot compete with the huge automall dealers would not match the price offered in the adds. With no trade in, no financing, and no upsale on an extended warranty or security system, the dealer had no motive to sell the car.

Most of cars on add are loss leaders, not that the dealership 'looses' money on them, they just don't have any 'gross profit' at that price, so the salesman only make a 'mini' or minimum commission of $100 or $150 dollars. The dealership will make a little money or break even on the car with the dealer holdback and unit sales incentives, but the salesman and the ASM or closer, don't see any of that money.

I must now make a most shameful admission, I once sold cars. I know, I know, and you call yourself a Christian, how could you possibly sell cars and sleep at night? That is precisely why I quit. I worked for two weeks, sold 6 cars and made a nice paycheck, and I did it without screwing anyone. But the whole point of car business is built on taking advantage of people with little or no information. If you don't know how much the dealer paid for car, what the options cost, what APR you qualify for at your bank and what the wholesale value of your used car is, you are going to get hammered by a salesman with a friendly smile and a line of BS.

Here are the Cowboys car buying tips.(this is not legal advise, just some pointers)
Use a free service like Edmunds to find out what the dealers cost is. This is not exact, but it's pretty close.

Call your bank or your Credit Union and have them pre-qualify you at a few thousand dollars over what you think the car will cost, just to have a little breathing room. Get the APR and the length of the term you want so you can tell the finance person that you will arrange financing yourself. If they don't finance directly with your bank or credit union they will make you sign an 'either or contract'. If you don't get your financing in place in 5 days, they will finance it through their lender, usually at 15% interest, so don't tell any fibs to your bank about wages or leave out your child support payments or you may get stuck with the dealers 15% plan.

If you don't know what rate you qualify for, the dealer will tell you that with your credit, you qualify for X% APR, you probably qualify for an APR 2 points below that, and if you take the dealers rate, they will sell your loan at the lower rate and pocket the difference. If you want to know who make the big bucks at a dealership, look at the person who sits at the finance desk, they set the interest rate, they sell the extended warranty and the other huge profit items.

If there is any way to do it, sell your used car yourself. The dealer will give you a few thousand less than they will get at the dealer auction, that is way below wholesale blue in most cases. If your upside down in your car, owe more than it's worth, suck it up and drive it, the dealer will roll your negative number into the price of the new car and you will be in the same boat again. It can be a viscous circle, after a two or three of those, you will be paying 21% interest on the car because you will be trying to finance 120% of its value. Stop digging.

Anyway, back to Gram and her new car, we drove down the road to another dealer who had the car she wanted on add, I avoided most of the BS and we were out the door in a little under two hours. That may seem like a long time for a cash deal, but that is about as quick of a car deal as you can get.

Gram is happy, the dealership sold a car and I am glad she has a nice car that she can drive without worrying it's going to leave her stranded.