Four Steps to Negotiate Your New Car Purchase

Buying a new car can be a white-knuckle ride.
Emotions run in the red, salespeople push for breakneck decisions and financing comes with tricky twists and turns.
But here are four steps to help you negotiate the course safely and cross the finish line with a deal you are happy about.

Stick to the plan. Before you start negotiating, decide what you want, how much you can pay and stick to it. During those fast-and-furious talks, a salesperson may urge you to add anything from extended warranties to a high-end sound system. Don't end up with a pricy case of buyer's remorse.

Square up. Auto dealers use a worksheet called a "four-square" when they negotiate your transaction. To avoid being boxed into a corner, figure out each worksheet component before you sit down to deal and keep all the details, except the total purchase price, close to the vest.

• Total purchase price. This is the only one of the squares you should discuss with the dealer. Know the new vehicle's base price, add-ons and other potential charges.
• Trade-in value. Find the value of your old ride; decide whether you're better off selling it yourself. Only discuss the trade-in after finishing up your purchase price negotiations.
• Down payment. Strive for 15–20% of the total price, if possible.
• Monthly payments. Remember, these can be influenced by other factors such as loan term or interest rate, which can make you lose sight of the actual purchase price. Keep your total transportation costs — loan payments plus fuel, insurance and maintenance — around 10 to 15% of your take-home pay.

Pick your battles: Sticking to the plan is good, but consider being flexible on minor details like color, trim and less-expensive options if they give you negotiation room. When a lower payment's at stake, do you really care whether those seat covers are taupe or rainstorm gray?

Get preapproved: If possible, show up with a preapproval from a lender of your choice. That way you know how good a deal you're getting, and you're not relying that the dealer will get you the best financing package.
-USAA