5 Tips To Help You Save a Bunch of Money on a New Car This Labor Day

Did you know that three-day holiday weekends are among the most popular times to purchase a car? If you’re like most people, you’ve been pushing off your new car purchase due to inventory shortages and high interest rates.

With both of these problems easing, this holiday weekend might be the perfect opportunity to purchase your new vehicle. In this article, we’ll cover five ways to save money on your new car over Labor Day weekend .

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Conduct Prior Research

One of the top mistakes you can make when purchasing a new car is neglecting prior research. Before you walk into the dealership, you should know your budget, including how much you can afford monthly. This allows you to automatically say no to any deals outside that range.

In addition, you should know the make, model, color and features you want your vehicle to have and the average price point. If your ideal Chevy should cost around $40,000 and the dealership is trying to sell it to you for $50,000, you know you have negotiation room.

“When it comes to negotiating the price of a car, knowledge is power,” said Joyce Ann Gutierrez, automotive expert at 4WheelOnline . “Start by researching the dealer invoice price and comparing it to the Manufacturer’s Suggested Retail Price (MSRP). This gap is where your negotiation leverage lies. Remember, the MSRP is rarely the actual price you should pay.”

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Go To the Right Dealership

Shopping at the right dealership can open the door to exclusive cost savings. Each dealership specializes in a few brands of vehicles, but they can also contain other one-off brands from trade-ins. Shopping at a dealership specializing in the vehicle make and model you are looking for can save you money.

After all, a Honda dealership will most likely get you a better deal on a Honda than a Volkswagen dealership. If you already know the type of vehicle you are looking for, visit dealerships with a comprehensive lineup. You can test drive the vehicle, view different options and negotiate more favorable prices and packages. Many of these dealerships are also able to offer available manufacturers rebates.

“Manufacturers often offer rebates, low-interest financing or special lease deals around the holiday, which can significantly reduce the total cost of the vehicle,” said Scott Kunes, chief operating officer at Kunes Auto Group . “Labor Day also falls near the end of the third quarter, a time when many dealers offer incentives to clear out current-year models to make room for next year’s inventory.”

Negotiate the APR

The annual percentage rate (APR) makes a big difference if you finance your new vehicle purchase. A 1% higher rate could mean an extra hundred dollars per month on your payment. When reviewing the terms of your deal, negotiate the annual percentage rate. Would putting an extra $1,000 down lower your APR?

“Although you can’t expect to drop your APR by 3%, there is some wiggle room,” shared Gutierrez. “In addition, inquire about introductory APRs from in-house financing. Sometimes, dealerships will offer you a lower rate for the first year. Then, you can refinance through a different lender.”

The APR you are offered will also depend on your loan term. Could you finance the car for five years, not six? How about shortening the term to four years? What is the impact on your APR? Changing other factors in your deal can impact your APR, helping you save the most money possible.

Ask For Freebies

If your salesman isn’t budging on price or interest rate, ask for free maintenance, upgrades or perks. Maintenance can be expensive, especially if you are purchasing a foreign-made vehicle. Working some free maintenance into your deal can save you hundreds of dollars. How about free oil changes for a year? What about a free tire rotation?

You can also ask for free upgrades, like swapping regular floor mats for all-weather mats or free detailing. Use the holiday weekend to your advantage to sweeten your purchase. Be confident when asking for freebies. If a salesman thinks you will walk away from the deal, they are likelier to throw in some free extras.

Shop Around or Order New

The first dealership you visit isn’t your only option. Visit different dealerships and negotiate terms with each one. Then, select the dealership that offers you the best package. In many cases, you can also use discussions from other dealerships as leverage. For example, telling Dealership A that Dealership B offered to give you free maintenance for a year and lower your APR by 0.25% can save you money.

Also, if you aren’t finding the perfect used vehicle, order new. Why compromise on what you are looking for when you can order a new car with exactly what you need? You should be able to order a new vehicle at the dealership without paying any unnecessary markups or fees. If your dealership is trying to charge you extra, look elsewhere.

“To get a good deal, consider multiple vehicles and shop around at several dealerships,” advised Renee Horne, chief marketing and customer experience officer at Chase Auto . “Getting your offers and all their small details in writing can help you stay organized as you work with multiple dealers. At the same time, having these notes handy as you negotiate can go a long way for securing the right vehicle for you.”

The Bottom Line

Are you confident about your new vehicle purchase this Labor Day weekend? Remember these money-saving tips and tricks to make your next car purchase a breeze.

This article originally appeared on GOBankingRates.com : 5 Tips To Help You Save a Bunch of Money on a New Car This Labor Day