Car Buying: Mythbusting

In this week’s edition of the Car Buying Series, I’m going to touch on some common misconceptions. These are things we’ve heard from various sources that aren’t exactly true about the car buying process. Now, I’m not saying they’re completely false, but it’s not good practice to go in thinking that they’re true in every circumstance. Not only will it make negotiations easier, it’ll make your car buying experience better and you’ll be able to build a rapport with your sales person, which is an incentive for you in case you need to do repeat business in the future.

1) More Money Is Made Off New Cars Than Used
I’m not entirely sure how anyone can think this is even remotely true. New cars come from the factory with a price. That’s what the MSRP is (for those who don’t know, MSRP stands for manufacturer’s suggested retail price). That number is public knowledge and vehicles are only ever priced over that MSRP if there are add-on’s to the vehicle or it’s a “limited edition” and there are only so many of that vehicle available for sale. At my dealership, when a salesman sells a new vehicle, they get $100. Occasionally they have additional incentives (like if there are too many of one model) and that number will double for the fifth sale or whatever, but that incentive for them is not part of your purchasing price.

Used vehicles, however, are in a gray area. The value of a used vehicle depends on the year it was made, the make, the model, the mileage and the condition of the vehicle. Kelly Blue Book and NADA can only give you a ballpark figure. They also don’t factor in any special features the vehicle may or may not have, which could increase or decrease the price. Like, if you’re trading in a 2013 F-150 but lifted it and put on an aftermarket grill, those things actually decrease the value of your vehicle to the dealership. For one, the truck they just bought for you that could have been a certified pre-owned vehicle can no longer be certified, because you broke the factory warranty on it by lifting it. It’s not as valuable to them as it is to you.

The price of a used vehicle is generally determined by how much the dealership bought it for (the trade value) and how much the repairs cost. Almost all vehicles traded in get new brakes and tires despite how good they were you traded it in. That right there brings the price up automatically. Then there’s also the fact that they need to make money off their investment, so they’re going to mark it up on the front end. So after all is said and done, if a dealership puts 3k into a car, they’re likely going to price it around 5-6k to try and make a bit of money off the car. Remember, they did put 3k into it, so in selling it for 5k, they only make 2k off it. I personally like them marking it up double what they put into it because that means there’s room for negotiation.

But they can’t mark up a new car like that, so when a car salesman tries to flip you from a used vehicle to a new vehicle, it isn’t to try and get more money out of you. It’s likely because the dealership can’t get you financed for a used vehicle and the only way you’re going to walk out of their with a new car is if you buy new.

2) Dealerships Will Never Sell A Car At A Loss
This sort of ties into the one above, mostly because I explained the pricing process. There are times that dealerships buy cars on trade (or at auctions) and have to put more into it than they initially thought. Those cars are then marked for just above cost and generally sit on the lot and don’t move for months. After we’ve had a used car for 90 days, we mark it down drastically in hopes to get it off the lot, even if it means taking a hit on the deal and not getting more than what we put into it. Why? Because we need to lot space for a car that we will make money off of.

As for new cars… due to the way they’re priced it can be difficult to take a loss on their sales but it is definitely possible. It helps if you come in knowing the dealerships weaknesses. Are they the only Ford/Dodge/Toyota dealership in your town? Threaten to take your business to a competitor, especially one you know will give you a better deal. It helps to have that deal in writing, so before you make that threat, I’d find that “better deal”. Taking hits is easier for corporately owned dealerships (the ones with multiple makes under the same name) because they can fall back on the sales of a sister dealership, but even the privately owned places have their weaknesses.

3) Dealerships Are Desperate To Sell Cars On Rainy Days
This one literally made me laugh out loud. True, rainy days tend to be slow, but there is no reason why a dealership would be desperate to sell a car on a rainy day. More willing to work with you? Sure, but not desperate. Now, the end of the month? Yes, they’re a bit more desperate. End of the year? Even more desperate. You see, whatever cars they own on January 1, they have to pay taxes on for that new year. Even if they only own it for a week. They’d rather be rid of it than deal with it in a year. The end of the month and the end of the year is all about making numbers.

4) Car Salesmen Don’t Care About You And Just Want Your Money
Most dealerships work off “draw” pay system. From my understanding of it, you get a monthly salary given to you at the beginning of the month. You are then obligated to pay that money back by the end of the month in sales and whatever money you make on top of that pay you get to keep. If you don’t pay all of that salary back, it goes into what’s called “the bucket” and it gets rolled into what you must pay back next month. I’ve known salesmen who got so deep in the bucket that they’ve been fired and the dealership just took it as a loss. This pay system is why I’ll never sell cars. I don’t have confidence enough in myself.

Understanding this system is important to understanding why most salesmen don’t just want your money. True, if they oversell you on a used vehicle they could easily make their draw in one go, but if they do that and you’re not happy with your purchase or their service, they loose you ever coming back and helping them out again. Or you referring customers to them. Being a salesman, you have to be personable. You have to care. You’re in a customer service line of work and if that customer isn’t happy, you lose money in the end.

This of course greatly depends on the market area. My area is decently sized but not so big that the sales people here can afford to burn bridges with customers. The market where I came from was huge and burning bridges didn’t mean anything. There were more than enough people in the city to make up for it. The important thing here is to follow your gut. If you don’t feel like your sales person is fighting for you when they go talk to their managers, don’t buy the car because they probably aren’t.

5) You’ll Pay Less Getting A Car From A Buy-Here/Pay-Here
This sorta ties into the last entry I did, though that one was mostly tied to private sellers. Buy-Here/Pay-Here lots are the ones with nothing but used vehicles on the lot. They get them from private sellers and auctions. They aren’t always the nicest vehicles, but they’re priced alright. The biggest draw for a BH/PH is that they often do in house financing. This means that they’ll give you your car loan as opposed to a bank or a creditor. This kind of thing is a huge relief to those with bad or no credit because they think that they can’t get approved for a loan. The only problem is that BH/PH generally go off a base percentage for their loans and that base percentage is generally in the 20’s or more. So let’s crunch some numbers.

Say you buy a car from a BH/PH lot for $6,000. Their in house financing gives you a 21% interest rate on a 24 month loan. Your payment on a 6k vehicle will be $787 for a total of $18,875.68 paid in the end. You just paid almost 12k more than was necessary all because you didn’t think you could get approved by a bank or creditor.

In the year I’ve worked here, I’ve seen Ford run several promotions for lower tier credit scores. I’ve also seen our sales reps bend over backwards to get their customers the financing they need and at a price they can afford. It’s going above and beyond like that that brings customers back time and time again. BH/PH contracts can also be tricky. Some of them have it in there that you can’t trade the vehicle to anyone but them, so that you’re forced to come back to them when you need another vehicle.

6) Dealerships Outsource Their Internet Sales (also known as BDC)
The dealership I currently works for does things in internet sales differently than I’m used to. Everywhere else I’ve worked, the BDC department does nothing but take calls, answer questions and set appointments. This one does all that as well as sells cars. When you call our BDC and talk to someone, they will be your sales person from start to finish unless they can’t complete your sale for one reason or another. As a general rule, it’s in the dealerships best interest to keep internet sales in house. That way questions can be answered immediately instead of having to refer you to someone else just to get a straight answer.

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I really don’t feel like I even touched the surface of all the myths I’ve heard about buying a car, but this entry is getting a lot longer than I intended it to. What are some things you’ve been warned about when purchasing a vehicle?

Car Buying: Certified Dealers vs. Private Sellers

There are a few milestones that are staples in a persons life: turning 21, graduating high school, getting a job in your chosen career field. Then there are a few milestones that are more individual dependent. Maybe getting married is a milestone for you, or having your first child. For me, buying my first car (a 2014 Dodge Avenger) was a big one and while that first car didn’t work out, I’m still proud of myself for taking that jump.

My first car was a late 80’s/early 90’s Chevy Lumina. It belonged to my grandmother and she left it to me when she died. I got that car when I was 17 years old. Since then, I’ve had a handful of cars, all of which were purchased from private buyers by my parents for no more than 5,000 dollars. So when my final car (an early 2000’s Volkswagen Passat) bit the dust when I was 24, I was determined to replace it on my own. In February of 2014, I purchased a brand new Dodge Avenger. This past fall, I traded it in for a 2013 Ford Fusion. And after a year of working in the auto sales industry, I’ll never buy a car from a private seller again.

Don’t get me wrong, I have nothing against those who sell their cars privately or those who prefer buying cars that way, I just know that the benefits that come with purchasing a used vehicle from a certified dealer (one with the Ford, Dodge or whomever name attached to their business) far outweighs what money I’d save not buying from them. It isn’t often you find a vehicle you can purchase out right from someone that isn’t high mileage or in some sort of disrepair. It is true you can use a personal loan to purchase from a private seller, but even then that vehicle comes with no warranty or guarantees. That’s not the case with certified dealers.

Now, when I say I’ll never buy from a private seller again, I also mean that I won’t purchase from buy-here-pay-here lots. They deal with only used vehicles and don’t have any one make attached to their name. While a Ford dealership can only sell new Ford’s, they can sell any make used. Buy-Here-Pay-Here can’t sell new cars period. Well, they can’t sell “new from factory”. The year may be current but the miles will always tell otherwise. Those dealerships are the ones that really give car salesmen a bad name. They tend to be ruthless and will say and do whatever to get you into a car. Now, the truth of what they tell you is questionable. They don’t have a higher standard they have to answer to. Certified dealers have random inspections from their certifier to make sure they’re doing things correctly. If even one thing is out of line, they lose a star in their rating, something that can be crippling for business.

Of course, when buying a car from anyone, you have to worry about being charged too much. But with the access to the internet we have, it’s pretty easy to find out what is and isn’t too much. Kelly Blue Book and NADA are accessible with just the click of a button from our phones and when you pull out those numbers, dealerships listen. The thing to keep in mind, however, is that you’re not only paying for this vehicle how it is but you’re also paying for any warranties it comes with (outside of any warranties they might try to sell you in finance). You’re paying for a promise that the vehicle they’re selling you is road ready and dependable.

It’s things like warranties, inspections and being held to a higher standard that are worth things being added to the front end of a used car. Of course, that front end has to be reasonable, but if anyone ever pays sticker price for a vehicle, they’re a special breed. There’s always room to haggle, even a little. And if they tell you there isn’t, then walk away. I cannot stress enough doing your research on a vehicle before going to purchase one. Find what things you like and what things you don’t. It’s when you go into a dealership without any knowledge of the product that you become over whelmed and are more likely to sign up for something you didn’t really want.

In the end, purchasing a used vehicle is about doing your research. In my research, I’ve found more reasons to purchase from certified dealers than through other avenues. What reasons do you have for purchasing how you do?

Car Buying: An Introduction

I’m rapidly approaching the one year mark of working at my current job. I’m the social media supervisor and inventory photographer for a Ford dealership here in town. This isn’t my first time doing this job (or at least the photographing portion of it). Back home, I worked for a Ford and Dodge dealership doing this as well. In total, I’ve got almost two years in the auto sales industry.

In those two years, I’ve learned a lot about car sales. And when I say a lot, I mean the stuff that I’m sure a lot of you would find common knowledge. Like, that MSRP is determined by the factory and the dealerships mark-up their prices from there… but that MSRP is the same across the country (it doesn’t go up or down no matter where you live). Or that a bank is more likely to finance a new vehicle over a used one (and no it’s not because they get more money from the new vehicle via the interest rate).

I’ve also learned that a few things I thought were true are actually very untrue. Well, they’re untrue depending on where you shop for your car and the company that’s selling it. Back home, I worked for a corporate dealership. That basically means that a group of people owned multiple makes. Sometimes they can be difficult to pick out, but generally they all have the same “first” name with Dodge/Ford/Toyota/Nissan tacked onto the end (ie: Young’s Dodge and Young’s Ford). The one I worked for back home had two different names for their Dodge and Ford dealership, because when they bought the Dodge one it was written into the contract that they couldn’t change the name.

But I digress. Now I’m not say all corporately owned dealerships are bad, but the majority of the ones I’ve worked with (even here in North Carolina) aren’t places I’d shop. Those dealerships tend to rely more on the initial sale than your repeat business. They’ll give you a great deal on a car, taking a loss of upwards of a thousand dollars sometimes, but any business you want to do with them after the fact is irrelevant to them. They couldn’t care less if you never came back because for everyone one customer they lose, three more come in the door only for the process to repeat. Now imagine this corporation owns five dealerships. For ever five customers they lose (one for each site), fifteen more come in. See why they don’t care?

Now I work for a family owned business. This is the only lot they have under their name and within the first few weeks of working here I could see a very definitive difference in the way they do business to the way the Ford dealership I worked with in Kentucky did business. They truly care about their customers. They might not be able to take as big of a hit as the other Ford dealership in town (the corporately owned one) but what they can’t do in price, they do in service. We’ve had several people purchase from us over the other Ford place simply because we cared.

So with all that in mind, when you hear that all car salesmen are out to get you for all you’re worth, don’t believe them. Some truly have your best interest in mind. The trick to figuring out which ones those are, is to always go with your gut. If you don’t feel comfortable with the deal or the salesperson, don’t go forward with it.

I’ve been sitting on the idea of doing a few entries on a look inside the automotive sales industry. Before I started working in it, I knew very little about buying a car. I used to think that buying a new vehicle was reserved for the exceptionally rich and that I’d be stuck buying used junkers for under five grand for the rest of my life. But that wasn’t true at all. Buying a car can be a very scary thing, but it doesn’t have to be. It shouldn’t be!

So consider this my first installment into my “Car Buying” series.

“Getting Into The Army Is In Your Hands”

This whole enlistment process has been a long one for me. It started maybe five (probably more) years ago when I tried for Active Duty Air Force. It ended the first time with a resounding “no” from the Surgeon General of the Air Force due to my heart surgery. He was “concerned with the integrity of my sternum” from my surgery and didn’t find me fit for duty. Cracking open someone’s sternum is generally how any heart surgery is performed. After all, your heart is tucked snugly into your rib cage for safe protection. There was only one problem with his reservations:

My sternum wasn’t broken in my surgery.

Of course, I didn’t find this out til two years after I had attempted the first time. Armed with a letter from my heart surgeon saying they didn’t crack my sternum and that there was no medical reason I should be disqualified from service (he did a physical just to be sure), I tried again.

That portion of my journey is a long one meant for another time. All-in-all it’s brought me to this point, over a year after I started again. I’ve gone from Active Duty Air Force to Air Force Reserves and now to Active Duty Army. I’ve dealt with a lot of different recruiters and no two have been the same. I was spoiled with my first recruiter. Staff Sergeant Sealey went above and beyond anything I could ever expect from a recruiter. I think he wanted me to get into the Air Force more than I did.  But he set the bar high for any recruiter I worked with after that. No one has compared to him and they likely never will.

Now, that’s not to say that my other recruiters have been bad in anyway, just that they haven’t been as good to me as he was. This last recruiter has me questioning if I should even attempt to get into the Army. Medically speaking, they’re more lenient than the Air Force. They also don’t require a credit check for certain MOS’s, where as all AFSC’s require a security clearance which means a credit check. My credit now is on the mend and is about average, but my history would not have me passing. So really, not having to get a clearance right away is ideal for me.

A recent conversation I had with a co-worker (and Army veteran) put things into a bit of perspective for me. I was questioning my odds of getting in because of my recruiters seeming lack of interest in my journey. I expressed that to him, and this is what he said. I’m paraphrasing but this is what I took away from it

“Now it’s been over 20 years since I enlisted, but even back then… your recruiter was only a tool for enlistment. Yes, you can’t get in without him, but he can’t get you in without you. Your process into the Army is 80% in your hands. You are going to impress the doctors. You are going to do well on your ASVAB. You are going to get the job you want. He’s not going to do any of that. So who cares if he’s not taking extra interest in you? Who cares if he’s not there when he doesn’t have to be? Only start raising hell if he’s not there when you call, because I know you… if you could do this on your own you would. If you’re calling him, it’s because you’re at a point where he needs to do his job. Otherwise, you do what know what you gotta do.”

It’s sound advice. For more than just enlistment too. It’s pretty solid when you apply it to life and the things you want. Your life is in your hands. You control it. No one else. If you want change, you make it happen. Don’t wish for it, don’t pray for it… make it happen. Nothing is going to fall into your lap. Do what you gotta do to make your dreams come true. The people in your life can’t make it happen for you, they can only help you along the way.

The only person who can keep your dreams from becoming a reality is you. Pour your all into everything you do and your efforts will be recognized. You’ll get the reward you deserve.

Your life is in your hands. Do something with it.

If You’ve Got A Heart That Ain’t Afraid To Love

“The threat of rain is hanging heavy in the air. The clouds block any attempt by the sun to brighten the day. It’s dreary and dismal and yet… oddly beautiful…”

So that pretty much sums up today perfectly. It’s been raining off and on all day, which has made doing my normal job of taking pictures of the dealerships inventory near impossible. They just ordered themselves a fancy new camera that I’m not taking any chances with. It’s bad enough that I’m terrified I’m going to drop it, I’m not going to get it wet either.

But being stuck indoors has given me an opportunity to do so much needed social media management for them. So far, I’ve optimized one of their outside websites to sync with their Facebook, twitter and YouTube whenever we load new inventory, I’ve put some personal touches into their twitter and Instagram and I was just handed some more busy work.

I’ve also been afforded some down time to asses my personal needs. Mainly the ones of my photography. A few days ago I was all worked up over the lack of community in the area when it came to photographers. I was darn near calling it quits. I was going to do the sessions I had in the books and that was it. No more.

But today I was contacted my clients who are excited for their sessions this weekend and I was reminded that I didn’t do photography for the community that comes with it. That’s a nice bonus, but I do it for the clients. I do it because I love providing quality images created from my eye.

This Saturday I’m having a boudoir mini marathon for five gorgeous ladies. All day I’ll be taking pictures for them and doing the impossible and providing their results in the next two days (while having two session on Sunday and my day job on Monday as well). I’m ready for it though. I knew it would be a big undertaking, but I’m excited for the challenge.

I love boudoir and I love making women feel beautiful. I’m almost ready to move solely into offering boudoir and I couldn’t be more excited for the direction in which I’m headed.

And Life Moves On

So. For whatever reason my medical documents didn’t make the SPF jump that everything else at MEPS did. I basically have to resubmit everything from my surgery back to whomever up there even though they have hard copies in some storage bin somewhere. Needless to say, it’s extremely frustrating. I have to get 500+ pages mailed to me from Kentucky so I can sit there and go over which ones are important and which are not with my recruiter.

WHICH IS FABULOUS IF YOU ASK ME.

Not gonna lie… I’m kinda peeved at MEPS but whatever. Another hoop right? I’ve only done five years worth of those.

There’s really only one negative going on in my life and it isn’t so much a negative. I’ve never really been that great at sugar coating things which tends to turn away potential friends. Not sure how negative that is really. Who needs people who do nothing but drain your positivity? No one, that’s who.

So I start my weekend with a boudoir photoshoot, then end my weekend with another and a maternity session. I couldn’t ask for better clients, really. They are amazingly strong and beautiful women who deserve every ounce of good will that come their way.

So to all my clients and potential clients; you’re beautiful. Don’t you ever forget that.

I Found A New Love!

Senior portraits! About a week ago I did senior portraits for a girl down here who was kinda screwed over by the public school system. Long story short, if she hadn’t moved here from Virginia (her father PCS’d here), she’d have graduated this spring. But when she transferred down here, a lot of her credits didn’t transfer with her and so she has to make them up and now won’t be graduating until spring next year. She’ll technically be finished in December but anyway.

She had senior portraits taken in Virginia but they had a “class of 2015” theme that she couldn’t use anymore. I offered to take pictures for her on a trade for basis and I couldn’t be happier with the results! I made myself use my nifty fifty lens despite it’s lack of auto focus and I’m super happy that I did.

Now, without further ado… here’s some of the best shots from the session!