Published May 23, 2019|4 min read
Car dealerships often run sales events on major holiday weekends to get new customers in the door. But with all the competing offers and red tape involved with buying a car, it’s hard to know how to actually get a good deal. Is a holiday weekend actually the best time to buy a car?
“The most important thing that car shoppers need to understand is that many of these ‘big holiday sales events’ are really just hype,” said LeeAnn Shattuck, owner and CEO at The Car Chick. “On certain vehicles, there may be some big rebates at certain times of year, because they need to get rid of those vehicles. But most of the time, the deals are not necessarily any better than any other time of year.”
But if you’re already in the market for a new car, you can use holiday weekend car sales to save, but you need to be smart. Ahead of Memorial Day, here’s how to capitalize on holiday weekend car sales.
If you walk onto a car lot without a plan, you may be steered toward an overpriced vehicle that doesn’t meet your needs. Make sure to do your homework before you go car shopping.
First, you need to determine the makes and models you’re interested in. If possible, take some test drives in the days or weeks leading up to your purchase so you can narrow down your options. Then, find out who has the cars you want in stock. Dealerships list their inventory online, but you can call ahead to make sure they have the car on the lot.
Remember that your first choice may not have any great offers, said Shattuck. The best sales and rebates may be intended to offload vehicles that haven’t been selling well.
You need to set a budget before you buy a car. Start with what you can afford in total as a monthly payment, and then work out what that means for total price, factoring in down payment or trade-in value. And don’t forget car insurance. Premiums are dependent on your driving record and the exact car, but you can get an idea by looking at the average cost of car insurance in your state or getting auto insurance quotes online.
Once you have a budget, research the Kelley Blue Book or Edmunds value of the cars you’re considering so you don’t end up overpaying at the dealership.
Holiday weekends are extremely busy times to buy a car, so call the dealerships to set up your appointments as early in the day as possible. Walking into the dealership without an appointment in the middle of the day can result in long wait times and unnecessary stress.
When you finance your car at the dealership, you have no way of knowing if they’re offering you the best loan terms. The dealership may also collect a fee for arranging your loan, which means you’ll be charged more than the loan costs.
Securing a preapproved car loan before you buy can help you get a better deal. You can get a loan preapproval from a bank or credit union. You may want to go through a lender you already have a good working relationship with or shop around to get the best rate.
Having a preapproved loan gives you several advantages when car shopping:
You already have a baseline interest rate so you know what to expect. You can take your preapproval to any dealership in town, which gives you the ability to shop around. The dealership may be motivated to beat your existing interest rate through their own financing connections.
Holiday weekend car sales are sometimes made up of flashy offers that don’t actually end up saving you much money, even when there are discounts off the sticker price. And it’s important to make sure you don’t end up paying more on the back end with longer loan terms or higher interest rates.
There are a few things you can do to make sure you’re getting a good deal:
Look for manufacturer incentives or customer rebates that knock some money off the purchase price.
Look for low interest financing options (usually reserved for buyers with the best credit).
Shop around to get competing offers from multiple dealers. Negotiate to get the best offer you can.
“Don’t assume the ‘red tag’ or ‘sale’ price is the best price you can get – still shop around to multiple dealers and negotiate like crazy to find the best deal,” said Shattuck.
While you can land a great deal on a holiday weekend, it isn’t the only time when you can save. Most common-sense car buying advice, such as planning ahead, securing financing and negotiating, will help you get a better deal — no matter when you buy.
Want more money tips in your inbox? Sign up for the Policygenius newsletter.
Image: Mathias Elle
Get essential money news & money moves with the Easy Money newsletter.
Free in your inbox each Friday.