Car-Buying Commandments We'll skip the "Thou shalts." Nine rules to keep you out of car-shopping hell
By Lawrence Ulrich

(MONEY Magazine) – 1 Know the numbers

Whether you use MONEY's car guide or other resources, seek out actual transaction prices, dealer invoices, resale values and incentives in your area. Top auto websites include and Kelley Blue Book (

2 Separate the car from the deal

Don't get distracted by come-ons like cash rebates and low-interest financing. Find the ideal car in your price range before you shop--or at least whittle down your options to a short list of three. Then drive them all, make an informed decision and stick to it. Only then should you look for the best deal.

3 Understand the dark side of rebates

The very best cars, like the Toyota Corolla, are top values even at the full retail price. Other cars require rebates simply because most people wouldn't buy them otherwise. That discount can lower your monthly payment. But expect every penny of that rebate, and often more, to disappear from your car's long-term resale value.

4 Shop the money

Check your credit rating and loan rates in your area. It's a good idea to get pre-approved for a bank or credit union loan. (Just keep it to yourself while shopping; it's harder to get the lowest price if the dealer knows he won't make money on financing.) If the dealer offers a better loan rate, you can always take it.

5 Play the dealers

Solicit bids from several dealers on the model you want, including options, using invoice and target prices as a baseline. The best dealerships will quickly offer a fair price to anyone who's serious about playing the field.

6 Put it to the test

Take a long, hard test drive in any car you plan to buy. To avoid pressure, state up front that you're not looking to buy today. Pay attention to the ride, steering feel and shifting smoothness; the comfort of the seats; the feel and placement of controls; and the design and quality of the interior. The car should feel stable driving straight, and solid and rattle-free over rough pavement. Test acceleration and braking, and listen to engine and wind noise at high speed. Make a panic stop on a back road. Climb into the back seat and assess trunk space.

7 Be ready to walk

Too many people stroll into their first dealership and drive out with a new car. If you're feeling confused or under the gun, walk out. You won't hurt anyone's feelings. You will gain time to think, confirm info, shop around or consult with family. Making your final offer and then heading home is a good way to put the ball in the salesperson's court.

8 Don't get hustled

You've settled on a price and are sitting in the office where you'll close the deal. Now firmly reject any attempt to pad the dealer's profit with needless extended warranties, service contracts or equipment you didn't ask for.

9 Don't pinch pennies

Beating a dealership out of that last $100 is no victory if it means you'll be stuck with an uncaring dealer or a poorly run service department. If a dealership or its staff gives you a bad vibe, shop elsewhere.