I think I'm going to write a book about this. I've given way too much car-buying advice.
When you go to the dealer, dress respectably. Be confident. Do your math in advance.
Here's what you need to do your math:
- a complete, honest budget on your finances
- insurance estimate (aim high)
- gas estimate (aim high)
- interest rate
- down payment
- total months
- invoice price (new cars)
Aim low on the monthly payment. Every $1,000 in price is roughly $15-20 on the payment. Figure out what the cost will realistically be, and aim about $50 lower per month.
The most important thing is to stay emotionally unattached to the car you're buying. That car is going to sell to someone, and there's another car waiting for you if you don't buy this one. Bring a buddy. Buy them lunch. Have them keep you on an even keel. The hardest part is saying "no" after your test drive, so get someone who you trust with your finances. Let them see your negotiating position and participate in the sales process. It gives the dealer the challenge of selling them the car, as well as selling you the car.