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Don't get fleeced! - Home HOME PREPARATION TRADE-IN SKILLS AT THE DEALERSHIP RESOURCES TERMINOLOGY Don't Get Fleeced Learn The Smart Way to Purchase a Car! fleece [flees] verb: to deceive and take money from (someone) The problem, the majority of customers go into a dealership without any knowledge of what vehicle is right for their wants and needs, their current vehicles trade in value, the fair market value of the vehicle that they are interested in purchasing, how a dealership hides profit, and many other skills needed in making a fair purchase of a vehicle of their selection. They ultimately get fleeced. This website will help you to become a more knowledgeable purchaser. First, a little about me. I'm a retired US Marine. I've personally owned in excess of one-hundred-twenty vehicles over the past 15 years, you could say that I have more than a small interest in the automobile industry. I've worked in the auto industry as a New car salesperson for Dodge and Mitsubishi Motors where I became certified in less than two months time where it usually takes a minimum of six months to accomplish. I was able to obtain and keep a national CSI, Consumer Satisfactory Index, score of a minimum of 96% throughout my career in new car sales, I moved on from there to used car sales and then onto automobile wholesale, then eventually opening a used car dealership with a partner. I firmly believe that the "customer" is king/queen in any business. The content is this module is based upon personal experience and provides an inside look of the back-end dealings of a typical dealership. This module is part of my Masters project in Learning Design and TECHnology at the University of Hawaii Manoa. This website is not affiliated with any financial institution or dealership as it is meant to be a educational tool for the wary buyer. Please take the brief survey below, don't worry their is no personal information being collected or saved. Once you complete that I would ask that you please take the pre-test so I can see where you are starting at and at the end I'll ask that you complete the post test so I may evaluate how much improvement was made through the completion of this module. There will also be embedded questions throughout the module. http://fleeced.weebly.com/[4/22/2016 6:00:12 PM] Preparation - Don't get fleeced! HOME PREPARATION TRADE-IN SKILLS AT THE DEALERSHIP RESOURCES TERMINOLOGY Purchasing a automobile can be quit a daunting and sometimes even a exciting process, next to purchasing a home, it is typically the second largest purchase a person makes in their life, so attempting to keep up with your neighbors when they buy a new or new -used car would not be the smartest thing to do. The only times that you should look to purchasing a new, new- used car would be when your family situation has or will be changing, for example you might be expecting and addition to your family, or your current vehicle is over eight years old or is breaking down and in need of constant repairs, becoming a money pit or more seriously becoming dangerous. When one of these occasions arise then one should do their research before purchasing either one. What can you afford? Establishing a reasonable budget is critical. The money you have available for a down payment, of which 20% would be optimal, and your potential, budget, for making monthly installments on a loan will determine your car choices. As a driver, you are probably budgeting for college, a home or other pursuits, so it is important to work with your family to set a realistic target. In doing so, consider whether this is a car just to see you through the next couple of years or whether it will be your traveling companion through 5 years or more. That distinction will determine how new and reliable the car must be. No question, the best way to save money is to buy used, or new-used as its called nowadays. By purchasing used, you can buy more car, meaning you could afford, say, a mid-sized sedan rather than a tiny econ-o-box. A new car loses almost half its value in the first five years, on average but still has more than half its useful life left. Letting someone else take the depreciation hit is a smart bet. But try to buy the newest car you can, in order to get the most up-to-date safety features. And If you are a new buyer, financing will be a challenge. Lenders are typically looking for adults with a good credit score, 660 and up, steady employment history, and financial assets, such as a five-figure bank account or a house. So if you're not already established, then in most cases, that will mean a parent or other family member will have to act as a co-signer or even take the loan in their own name. Federal law requires that a individual has the right to see, review their personal credit ratings annually at no charge, you can go to http://www.consumer.ftc.gov/articles/0155-free-credit-reports for more information and a link to the reporting services to receive your report, you may also dispute any of the information if it is incorrect whereas if it is shown to be incorrect then the reporting agencies must update your reports with the corrections at no charge. A loan is a business agreement based on a lender charging interest for you to borrow money. This is a place where a dealership can make a tidy profit without the consumer ever realizing it. So if you know that you will be financing the purchase its best to go ahead and get a per-approval from your bank, even better from a credit union as they typically have the lowest interest rates. Please note than most credit unions and banks will finance a used car at new interest rates if the car is three model years or newer. Please take notice if the manufacturer is offering 0%, there will be qualifiers though, such as losing rebates or non-negotiable pricing, etc. Remember nothing is free! The lower the interest rate and shorter the loan period, try to keep the term to no longer than 36 months, the less extra you pay in finance charges. Most dealers and banks want you to go 60 months or greater, or even better yet, ten years, as this is their bread and butter when it comes to their most profitable customers. Of special note, watch out for the mom and pop pay it here lots, as they can charge up to 28% interest, where the avg is around 7%, and they don't have to, and most times do not, report to the credit reporting agencies, unless you don't pay them. So, if you are a new buyer and have little to no credit, then the best solution may be to borrow from a family member, repaying them a fair interest rate that they would have seen from their savings account. That would save paperwork, keep the money in the family, and hopefully allow payment flexibility. Do not run your credit unless you are very serious about an upcoming major purchase. If you wait and run your credit at the http://fleeced.weebly.com/preparation.html[4/22/2016 6:13:33 PM] Preparation - Don't get fleeced! dealership or bank, then it will affect your score each time it has been ran. In other words, do not rush into a dealership and run your credit, this is what many salespersons will attempt, they want to run your credit and check if you have a trade that they can steal. Simply bring the copy of your report that you received for free, this should suffice enough until you are satisfied enough to complete the deal, then let them run your report. To save time and also to insure that you look like you know what your doing then you'll need to take the following items in with you: POI or better known as Proof of Income, bring two 2 three months current pay stubs POR or better know as Proof of Residence, bring two forms such as; bank statement, electric/water/gas/cable bill, or telephone bill and they must have your name and current physical address on them References: Ten names with current addresses and telephone numbers of friends and family They're already thinking about how much that they can gross, make before you've had a chance to selecting a vehicle. Do your homework. Now that you have a budget in mind, now comes the fun part: creating a short list of target vehicles. Focus on practical choices—cars that will minimize ownership costs and suit your needs for the next few years. To right-size your costs, resist the temptation to target sporty, luxury, or large vehicles. They can be costly to maintain and insure, and tend not to get good fuel mileage. The last thing you want is to raid your savings to cover car costs. Instead, look to small sedans and hatchbacks from mainstream brands, or even better, mid-sized sedans. Here's a brief list of vehicle types with their most practical use; Coupe/Sports Coupe - 2 door vehicle typically used by single or couples because access to rear seat not important Sedan/Sports Sedan - 4 door vehicle typically used by families of three or more Mini Van - 4 door vehicle used my families of four or more Full size Van - Used by families with older children Compact - Mid-size SUV - Sports Utility Vehicle - used by families of four or less, singles and couples Full size SUV - used by families of five and up to eight Trucks - generally used by everyone, but not normally as a primary family vehicle Often times it can be tempting to lust after a high-horsepower car or one with the latest-and-greatest high-tech features, but be practical.

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