Buying a Used Car at a Dealership

George just purchased a new (used) car this week. Today he shares his process and tips for buying used cars on your own!

My car accident two months ago left me without a car.   Based on research and friends’ recommendations I decided that I wanted my next car to be a Mazda3.  I stopped by a local dealership to try one out in person, and I was very impressed by its responsiveness and tight turning radius. From there I set out to find the right one for me!


I started at and used their calculators to find what a fair value for a Mazda3 would be on the used market. I liked this site because I could switch between trim levels and years and see how that affected value. I decided that I wanted to look for car that was 3 or 4 years old but with a higher trim level. That led me to decide on the 2010 Mazda3 S Grand Touring. (I didn’t know what the “S” versus “I” meant in the car’s model, so I asked one of the sales people via their online chat!)

With the specific model that I wanted settled, I could begin searching local dealerships for matching cars and easily compare prices. Online search tools like made this very easy. I picked the dealership with the best price on a car with less than 70,000 miles, and I went in to take it for a test drive. The test drive went well, so I told the sales person that I liked the car… and the pricing discussions began!

Negotiate the new car’s price, your down payment, and the trade-in’s value separately.

When you’re discussing pricing with your sales person, they may tend to discuss the deal with you in terms of monthly payment. This is a subtle trick which separates the discussion from the actual cost of the car.

After you’ve been looking at cars that cost thousands of dollars, a $25 difference in monthly payment may seem insignificant. Beware! Over the term of a 4 year loan, a $25/month increase ends up adding $1,200 to the cost of the car.

When my sales person tried to complicate the math by figuring out my down payment and my trade-in and the car negotiation, I simply asked that we finalize the total cost of the car first. That way I never lost track of how much I was spending.

If financing, be sure to get pre-approved at your bank before you go to the dealership.

When I purchased my last car I made the mistake of financing through the dealership.  I left the dealership with a 6% loan on my car. I learned later that I would have qualified for a 2% loan through my local credit union. Moral of the story — dealerships make money on both the sale of the car and the loans that they facilitate. Financing through your local bank or credit union will help you get a better rate.  Moreover, credit unions are non-profit organizations, so they’ll typically give you better rates than banks!

Lastly, make sure you take into account sales tax, dealership fees, and DMV fees when you’re figuring how much you can spend on your car. Unfortunately, these fees are less negotiable than the car’s pricing and extras. However, you may be able to lessen your DMV fees by re-using the license plates off of your trade-in vehicle, or cut out dealership fees by submitting your own registration documents.


I’ve only had the car for two days now, but I’m happy with the process I used to pick and buy it. I’m looking forward to having the Mazda3 for a long time!

3 thoughts on “Buying a Used Car at a Dealership”

  1. Great looking car and lots of good advice! One can get so caught up in the excitement of car buying one forgets to do some “horse trading” :0) Hope it last you many years!

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