AGLS Exam 2 - FLASHCARDS - Car Buying part 2

Question 1

What are the steps to buying a new car?

Answer 1

1. Agree upon a new car price. 2. Agree upon a trade in price. 3. Select your financing

Question 2

What is manufacturer suggested retail price (MSRP)?

Answer 2

The price set by the manufacturer. This is a “suggested” price.

Question 3

What is fair purchase price?

Answer 3

The going market rate or price range of the car

Question 4

What is invoice price?

Answer 4

What the dealer pays the manufacturer for the car.

Question 5

What is dealer holdback?

Answer 5

Manufacturer pays 2-3% of the car price to Dealer after sale of car

Question 6

Should you make the first offer?

Answer 6

No. The dealer should make the first offer

Question 7

Should your first counteroffer be high or low?

Answer 7

Low

Question 8

Who should you bring with you to help talk them down?

Answer 8

The hulk

Question 9

Should you agree on a sales price before or after discussing rebates?

Answer 9

Before

Question 10

What price should you ask for?

Answer 10

The out the door price (all costs)

Question 11

What percent of the sales price is tax?

Answer 11

6.25%

Question 12

What does a car’s title prove?

Answer 12

Proves legal ownership is documented with the state

Question 13

What is a license?

Answer 13

Registration required by the state to recieve license plates

Question 14

When is the best time to buy a car?

Answer 14

At the end of the year

Question 15

What website do you use to find what your trade in is valued at?

Answer 15

Kelly Blue Book

Question 16

Does a dealer offer less or more than a car would go for with a private seller?

Answer 16

Less

Question 17

How do you determine your finance amount?

Answer 17

New car payment - trade in allowance - cash rebates = pre TT&L price + tax, title, and license - down payment = finance amount

Question 18

What information does Carfax provide?

Answer 18

Lemon status, accident history, major repairs, lein and ownership history, warranties remaining, and mileage and miles per year

Question 19

What is the vehicle identification number?

Answer 19

Combination of 17 characters (numbers and letters) assigned to a car during production

Question 20

What are the steps to buying a used car if paying with a loan?

Answer 20

Get pre approved for a loan, negotiate and agree on the price, get check from lender, meet seller at DMV, trade check and title, check VIN on title, submit title registration and insurance, get a new title with lender’s name, and pay off loan and get a clean title

Question 21

When will you have the most bargaining power?

Answer 21

At the end of the month (monthly bonuses), at the end of the year (yearly bonuses), and when the next year’s model comes out

Question 22

What are ways you can fund a down payment?

Answer 22

Savings, trade in vehicle, family contributions, and cash rebates

Question 23

What percent of a car’s price up front is a down payment?

Answer 23

10-20% of the car’s price up front