Sunday, April 7, 2013

Topic 14: Used Car Resurrection

Many folks ask if they should buy new or used - buy used and put your money in your pocket for other things.  New cars smell nice but can run you $30 to $60k versus a nice 5-10 year old with under 100k miles for around $10k or less.  These cars are "AS IS" and you will want to get them up to snuff but it's still cheaper than buying new and having that debt hanging over your head and monthly payment you can't afford.  Now is not the time to have huge obligations!

So you decided to buy used and noticed some things - get to a trusted mechanic and say the following "I want to fix what is dangerous plus a list of what I should do down the road.  Red light means do now, yellow means soon, green means when my ship comes in."  A good mechanic will do just that.  Fix the red light things and throw in a couple of simple things with big effects i.e. have the oil changed at a place like Jiffy Lube or Kwik Kar as they will check and fill all your fluids.  Have the tires rotated and balanced so you don't shake going down the highway.  Get an alignment if the car pulls to one side - not a good thing.  If they want you to fix the brakes and rotors need re-doing, have at it - you want the car to stop and go.

My other favorite service to keep you going is a transmission service - either flush and fill or pan drop with new filter, etc.  DONT DO THIS IF OVER 100K MILES.  If you can keep your brakes  your engine, your transmission, your radiator, and maybe your power steering systems clean that preventative maintenance can save you money down the road.  Replace your wiper blades while you are at it so you can see.  Does not hurt to wipe your windows inside and out.  My favorite product for exterior windows is Rain-X 2 in 1 - cleans and repels water.  You can use Windex on the inside if you want.  Blue Magic makes a good headlight cleaner - just buff it one, wipe off with some Windex and you can see further at night.

Nothing says "new to you" like cleanliness.  If you have $100 take it to a place like Aqua Car Wash and get an inside and out detailing job - they'll clean the upholstery, the carpet, the mats, and wipe everything down - worth every penney.  If not, get a vacuum, some wash and wax, and wash down the insides and outsides.  For spots on rug, Blue Magic makes a good product called Spot Lifter, they also have a carpet and upholstery cleaner and some good value leather cleaners and conditioners.  That keeps your leather from cracking.  Scrub those tires and wheels and after dry spray the tires with some Blue Magic or Black Magic Tire Wet - really looks great.

Throw in a complete fuel system cleaner in the gas tank while your at it to help it run smoother and save gas.  Gumout Regane is good at Wal-Mart, etc.

So you bought used, fixed the broken things, the car drives straight and is clean inside and out.

Now take that extra cash and pay your insurance!

Sunday, February 12, 2012

Save Gas With Johnsen's Mega Mileage Improver

Frustrated with gas prices going up again?  Have a car 10 years or so old?  Never done a fuel system cleaning?  You can get a multiple part service done at a Jiffy Lube or Kwik Kar which is more complete or start out at a retailer like Sears or KMart or Blaines and get the Johnsen's Mega Mileage Improver which can improve mileage up to 5.7%.  Made with proprietary technology from Lubrizol, the older the car and the worse the gas you've been using, the more improvement you will see.  use it every 15k miles and you'll be good to go.  If you need more immediate results, go to the Kwik Kar type outlets and the 2nd and or 3rd Steps can get you more immediate results.  These products can also lower emissions which comes in handy prior to that annual inspection.

So the good news is there are thing you can do to save gas:  Use a fuel system cleaner, change the oil with the right oil, change your air filter, make sure your tires are properly inflated, consider synthetic oils throughout your engine and transmission, etc.

None of this is free but they all work.

So if gas prices get you down, get some Johnsen's and get that junk out of your trunk!

What Happened to the $4k Cash Car?

Most folks just received their tax refund and are excited to browse Craigslist and local lots trying to find that perfect first car for them selves or son or daughter or a cheap get to work car.  Alas, to your surprise  they are all gone now replaced at best by $6 to $8k cars.  What happened?  Are dealers pulling a fast one?  Actually no. Cash for Clunkers pulled thousands of cars off Americas roads to help emissions.  An unintended consequence was less cars to sell you at those price points.  You might find one on Craigslist but they are gone when you call.  Or you get there and they are worth exactly what you pay for, which usually means a couple of grand worth of repairs to make it road worthy or find it's a salvage title or you have to chase the owner on account of title problems, none of which are how you want to spend your time.  Also with fewer cars made over the last few years, there are less to choose from, fewer go into rental fleets, etc. so based on the rules of supply and demand, supply is short so prices go up.

So what's a person to do? 

Do your homework, find the best cars used for the money, usually a low mileage domestic like a Ford Taurus or old standbys like Hondas and Toyotas.  You won't get a smoking deal but you will get a good car and for less than new or even places like CarMax.

At 9995 Motors we pride ourselves on good cars at a good, no hassle price, a consultative selling approach with no pressure, and no salvage titles and no games.

I started 9995 Motors to sell good cars at $9995 or less.  I was a CarMax consumer but felt like I wanted to spend less than $13k or $20 k or $25 k to get to work.  So I did it myself

If you like the car, you can buy the car, it's that simple.

So if you had a wreck, are on a budget, and don't like games, check us out at www.9995motors.com and then come by and see for yourself.

$4k days are gone but you can stay below $10k and get to work just like everyone else...just smarter and on the road faster!

Sunday, January 30, 2011

Topic Ten: "The $3k Cash Car" Versus Financing $6k

So you have your tax check or your daughter turned 16 and you think $3k is a good amount for their first car.  You are right on all fronts, however, unfortunately what $3k gets you today you do not want to be in unless you find what I call "the magic bean".  By that I mean every once in awhile you find on Craigslist an unused old persons car that they don't want anymore and you drive away happy.  Most of the time though for $3k you are buying $2k worth of repairs and lost peace of mind.

We are satifsying many families now with cars around $5495 where they put down the $3 or $4k and instead get a car with less miles (sometimes under 100k miles) and sometimes less than 10 years old.  Payments are $300 a month and don't last more than a year or year and a half.

So whether it's for you or your new driver getting to high school after school events or college, this may be a better option for you in the long run.. They are all AS IS and you will be doing maintenance on them (and would want to) and most likely want to knock off a couple of things along the way like fixing the annoying electric window but that's cheaper than a $5k engine, a $3k transmission or a $1500 cooling system or $1000 radiator replacement.

So hunt for the magic bean but also come by and see what we have on the lot and you might find the magic bean is actually on my lot!

Sunday, January 9, 2011

Topic Nine: Buying New Versus Used Cars

Lots of people ask me if they should buy new with low interest rates right now.  If you have $40k or can handle another $40k debt and prefer no risk, no hassle for a couple of years except oil changes or have a high visibility job, then have at it with the new. 

If you want to keep your credit score high, reduce long  term obligations for whatever reason and have lower payments then consider used. The interest rate is higher but a $10,000 car will cost you less than a $40k car. 

For value, the sweet spot is around 2-4 years old - someone took the hit on the first depreciation (probably around 40% of the value of  the vehicle has eroded) but you still have a nice looking, high use value vehicle. 

Go older and the value to you of getting to work is higher than any payment you might have on the used car.  At 9995 Motors I am hunting now for ten year old low mileage vehicles for ultimate driving value.  I call it the magic bean - sometimes you can still find it and it's perfect for getting to work or that new driving son or daughter.  I keep the prices below $9995 so you can buy for cash with your tax check or keep the payments around $300 a month and get it paid off in under two years.

You will fix a used car - regular maintenance, things wear out, and there will be things you personnally just want to do - could be a better stereo so you can customize your ride but you will still have saved money.

Vehicles differ as well - in general the fun, cool ones you want probably will need more care than the boring a to b car.  Just go in with eyes wide open, be honest with yourself and browse online or on the lot.

Ultimatley, it's fun to plan for your next car - come by and talk to us at 9995 Motors or send us an e-mail at motors9995@yahoo.com and let's discuss what you need and what you want!

Sunday, January 2, 2011

Topic Eight: How I Structure A Deal In 5 Easy Steps

You need a car and you need to make payments.  You have iffy credit and don't want your credit checked or the loan on your credit report.  At 9995 Motors we totally get it.  At some dealerships you'll get the Spanish Inquisition but we try to be minimally intrusive but also find out if you can make your payments.

In general, we need around $1500 down, ususally to pay off what's left of our floorplan loan on the car.  Then we try to keep your payments around $300 a month so that you can get to ownership as fast as possible.  We also try to make your car paid off in under 24 months so you get your equity and can get on with your life.  I also try to keep your interest rate under 20% unlike most credit cards.  That rate seems high but let's face it, dealer financing is risky with 25% of notes becoming repos.  We need a couple of references for you, your place of work, your drivers license, etc. but that's about it.  We als deal in cars under $9995 hence the loan balance will not be $25k.

How does this compare to other dealers?  Other dealers will mazimize profits by stretching your payment for as many months as possible.  They will also charge you 26% interest and who knows how much for the actual car.  Some will even do $500 down to hook you and get as many people on notes as possible.  If you can't pull together $1000 you probably won't have enough for comprehensive insurance (dealer is on insurance as loss payee in case of accident as they still own the car for now), let alone maintenance and repairs and gas.  If you are late, they repo the car and resell it.  I have done repos before but try very hard to keep you in the vehicle.  Wait a few weeks, get to $1000 or so together and then come see us.

If this sounds like what you need then come by and see us and we'll treat you with respect.

Saturday, December 4, 2010

Topic Seven: Haggle Versus No Haggle - How Much Do Dealers Make?

50% of America hates to negotiate but 50% likes it.  Go figure.  I can't stand it, so as a dealer at 9995 Motors, I decided to treat people the way I wanted to be treated - easy, quick process, transparency on questions, priced right from the get go, clean cars, and get me in the car fast so I can go back to my life ASAP. Who wants to spend the day at a dealers trailer anyway.

Lots of folks ask me about how much room there is on a vehicle to negotiate.

The answer is it depends.

It may seem like a lot of money to hear a dealer grosses $1500 on a sale yet that is the gross difference on that transaction between what they paid for the car and what they charged you.  Don't get me wrong, its hard to save $1500 but what consumers don't know is dealers end up netting only about $150 a car after their expenses from that $1500 when you put on a rent factor, overhead, etc.  That's why dealers want to be the low cost leader and the high volume leader. 

Unless you sell a bunch of cars, it's hard to eat off of $150.  If you think about all it takes to find a car, buy a car, prep a car, get it in your system, promote the car, sell the car, deliver the car, get plates for the car, $150 is a joke.  But...for folks who love the business, it's well worth it and if you can move thousands of vehicles, well then you are going to see them drive a nice car and sponsoring that little league team.

So ultimately little haggle is the way to go - saves time for you and them but you have to be ready.  Use the web to find out what kind of retail price is fair, offer them 10% off that and you may be able to drive the car away in under two hours or so.  As long as negotiation still exists, most cars transact close to 10% off anyway. Why not skip a step.  If they are willing to let you walk away they really can't sell you the car for what you offered. 

Our goal at 9995 Motors is to price the cars close to a no haggle price and have them delivery ready - they are all AS IS, all used (hence always something you want to have done to your new purchase) but have passed the safety inspection.  I can get you on the road in under two hours as I do not sell you extras, just cash deals or finance deals.  So if you want good clean cars at a good price then go to http://www.9995motors.com/ and take a look.

Saturday, October 30, 2010

Topic Six - The Golden Moment - Delivery and Post Delivery Assessment

Well you bought it.

Expect some fear and trepidation as it's your second largest purchase and these are used cars.  There are things worn out on it. 

My recommendation is you take it to a trusted mechanic (I use First Choice Automotive in Magnolia) and ask what needs to be done for...SAFETY, not fix everything worn out on a used car.  If they find other annoyances, then great, get a list and knock them off when you have a little cash available.  You bought this vehicle anyway to get from A to B. 

Places like Firestone on 242 warranty their work if that makes you feel better and they are a one stop shop.  I also use Jiffy Lube alot for fast oil changes/fluid fills and NTB for tires.  In the Woodlands, Magnolia area I also like All Star Muffler and Brake for those kinds of things and Gersitz/NAPA Auto Care for inexpensive repairs. 

Pick your service provider of choice and start a dialogue with them so they can know what you want to do.

Before I sell cars I buy stuff at places like Wal*Mart and Autozone or Advance to do what I can do like wash the exterior, dress the tires, clean the engine, wipe down the interior, clean the leather, treat the windows, etc.  You can do the  same and it's simple.

Things like:
1. Blue Coral Wash and Wax - cheap and good
2. Gumout or Slick 50 Fuel System Cleaner - pour in tank and get better performance and gas mileage.  Go to Shell or Exxon station and put in tank of premium - also filled with fuel injector, intake valve, combustion chamber type additives/cleansers.
3. Black Magic Tire Wet - looks nice
4. Comet or Ajax cleanser and a two sided sponge - clean your metal wheels
5. A large car wash towel - Target and Wal*mart and those autoparts places have them - get a big one to save you time
6. An old shower towel - nice fluffy cotton dries the car quickly
7. Rain-X 2 In 1 - cleans the glass and leave water beading technology on all the windows.  Go 55 in the rain and you'll do this every couple of weeks!
8. Windex or any interior glass cleaner - you be amazed at your better vision  - use an old washcloth for a quick job
9. Black Magic Dashboard Protectant - gives your interior a glossy shine after you've rinsed your car wash towel and wiped down the interior.
10. Black Magic Engine Degreaser and Shine - spray on, wipe with your sponge on areas you can see big grease spots and spray off with hose.  You don't have to wrap any parts using this product.
11. Any carpet cleaner - spray it on, scrub it in with kitchen scrub brush, soak it up with another cotten towl and let it sit.
12. Any deodorizer - some folks use Carpet Fresh, let it sit (its fragrance and baking soda) and then vacuum it up

If you do some or all of these, your car will look its best and run as best as it can.

Sunday, October 24, 2010

Topic Five - The Paperwork!

No one likes paperwork but buying a car is the second largest purchase you will make and you want it to be right.  Buying a car can be inherently simple - find what you want and give them money for it.  Because it is a large transaction at some point before or after purchase you want to know what you signed and the implications therof.  If you are decisive, found a car, the price is OK, you can get out of a good dealership like 9995 Motors in under two hours from start to finish.  Find the car on the web, see what a decent price is on places like Autotrader.com or Cars.com, go to the lot and drive it and then in the absence of wierd sounds coming from the car or poor handling, have your money ready and go for it.  Cash is king for dealers so bring your wad of bills.  The documents you will see for a cash deal:

1. The Bill of Sale - outlines all the charges and costs - the real contract.  Make sure your name is the same on every document or you'll have title hassles
2. Odometer Disclosure Form - notes miles at time of sale (big deal over the years)
3. Buyers Guide - Outlines all the things that can break and will - these are used cars
4. County of registration from - most dealers register you at nearest DMV - if you wanted your sales tax to go to your specific county, now if your chance.
5. Application for title - what the dealer takes to the DMV to get you your plates and registration sticker
6. Temporary plate and receipt - keep the receipt in your glovebox. Temporary plate goes on the back and is good for a couple of months until you get your permanent plates.
7. Agreement to arbitrate - should all go poorly you and the dealer agree to go to arbitration - saves on court costs and reasonable people will listen to both sides.
8. Agreement to provide insurance
9. Privacy Notice

Your title will come in the mail about 6 weeks after the dealer goes to the DMV.

Additional paperwork for Finance Deals:
1. Finance contract - notes interest rates, amount financed, etc.  Also notes your obligations i.e. they can repo you if you do not pay on time, do not keep the vehicle in good repair, do not provide him/her proof of insurance (at 9995 Motors, I have folks call or go on the web to someone line SafeAuto, Geico, etc.), etc.
2. Credit App - should the dealer share your info with someone like Wells Fargo or Bank of America to help you get a regular loan versus the dealer being your banker.

At 9995 Motors, I give folks a manila folder to keep all their car records.

The bottom line is you can get all this done in under a couple of hours and drive home at 9995 Motors.  New car dealers may take longer as their processes involve separation of the deal from the financing, they sell you other things in the finance office, someone else may prep the car, etc.  We have the same person handle all aspects of your car and your deal so you know who to talk to and they ensure all is ready to go.

Read the paperwork at that time or read it later but know what you signed!

Next Week: Vehicle Maintenance - Keep that Car looking great and on the road!

Sunday, December 13, 2009

Topic Four: Used Car or Truck Purchase Process Variables and Tips

Keep Your Wits

So now you are with the salesperson or finance person at the dealership and have landed on the vehicle of your dreams.  Be careful not to get caught up in the moment - save the euphoria for when you take delivery as it is a great feeling.  For now, put on your bankers hat. 

Don't Get "Hot Boxed"

Some dealerships are very aggressive in closing the deal, expect a certain amount of discussion designed to get you to move forward but if at any time you feel extremely uncomfortable,  say so and/or get out.  There are many variables in how much you ultimately pay for a vehicle, including repairs based on it's condition. 


Trade In Effect

Make sure you confirm the actual sales price for the vehicle, tease out any trade in valuations - used vehicle trade ins are only worth what the market bears - dealers can give you more for the trade than book value (NADA.com is a great source as is Kelly Blue Book or KBB.com) but they are just charging you more for the vehicle you are buying. 

What Dealers Try to Make

There is a certain amount of gross profit it takes for a dealer to net any amount of profit on the deal.  Seems odd that they may shoot for a $2000 margin on you and end up taking $150 to the bank but that's why volume is king.  Thus they will find a way to make something somewhere.  It's like squeezing a ballon in different sections, one section may get squeezed but another section expands and the same amount of air (profit) is still in the balloon.    Profit allows the dealer to eat so do not begrudge them something. 


When To Buy A Car Or Truck

One note - cash buying is quite beneficial for you as well as purchasing at the end of the month.  We want to hit our numbers - it's how we live but also part of our psyche.  "One more on the board" feels good and feeds the kids so help us hit our goals and maybe shave a few hundred off the deal.

Interest Rates

If you are getting bank financing they are all fairly comparable.  If you are getting dealer financing sometimes called "Buy Here, Pay Here" or signs say "We Finance" that means the dealer is the bank as well as the dealer.  States set top interest rates just like for credit cards and they are just as high i.e. can get up to 26%.  If you need a vehicle for work you need a vehicle for work but see if you can demonstrate some credit worthiness.  Years on job, years in house, owning a home, good paycheck, multiple references all point to stability.

Monthly Payments

One way for not so good dealers to make lots of money from you is to have you pay for years.  I realize you need a certain payment to live but try to pay the car off as fast as possible!

Down Payments

Put as much down as you can.  Use the "Friends and Family" approach - I do not care where your money comes from - collect what you can and pay those folks off with your next paycheck.  The more you put down the more likely a dealer is to sell you a car and finance you himself.  Look to put down about 1/2 of what the list price is.  You can get $500 down but that barely covers registration and title and sales tax.  The dealer will get good profit on these kinds of deals but try to collect more than that.

Fees

Fees are fees, most are legitimate - the only one you might fight is a documentation fee - I use it to pay my brother to go to the DMV.  You don't have to pay it but if you want the car, I'd let the dealer have his $50.

So those are the variables and notes on bringing each one down as best as possible.

More next week on the actual documents leading up to the "Golden Moment"!

Sunday, November 29, 2009

Topic Three: Used Vehicle or New Car or Truck Purchase Preparation

So you've landed on your three most favored car or trucks. 

You've collected all the cash you have from friends, family and savings.  You've decided how much you have versus how much the vehicle costs which means you will either pay cash or finance the purchase.

Cash deals can be very fast.  At 9995 Motors I have been able to deliver a vehicle in under an hour for cash deals.  Finance deals take longer but we are able to do that in under two hours if you come with all the proper documentation for a credit application.  Short version of that is drivers license, current address and information about rent versus own, years at that location, references with phone numbers, employment data, including name of company, address, years there, occupation, monthly income from all sources, a utility bill for proof of residency, phone numbers, etc.

You've also test driven each one, you've seen what you should pay for them by checking comparable cars and trucks on NADA.com or AutoTrader.com or Craigslist or new car information site.  If a used car or truck you're either willing to buy AS IS, have done your own mechanical assessment, have taken it for a diagnosis at a Firestone or NTB or other mechanic, and know what you'll need to do to it for repairs.

So now just tell the dealer which vehicle you want, whether you will pay cash or want to finance, and how much down if a finance deal.  You also want to consider the monthly payment you can really afford.  At 9995 Motors, I ask consumers how much money they have allocated for transporation montly.  Deduct insurance and gas costs, set aside $50 a month for maintenance and repair (maintenance meaning oil changes, air filters, system flushes, repairs meaning things like new radiators, tires) and what you have left from the fund is what you can afford montly.  As a guide, used car dealers who finance you themselves look for 1/2 of the purchase price down and $300 a month as a guideline.

If you cannot hit those parameters you may want to consider not buying until you get your situation in order.

Look for the actual transaction step in my next blog!

Thursday, November 26, 2009

Topic Two: Buying a Car or Truck? Need based approach.

Buying your first car for school, for your son or daughter, or going to work?  It is the second biggest purchase of your life but actually pretty simple process when you break it down and can be fun. 

The best thing to do is to think first about what you need not what you want.  Think about how much cash you have as cash is king in the automotive world.  If you have enough cash, you may be able to buy your car outright.  Dealers love cash as it helps them pay their bills, buy more cars, etc.  Cash deals are actually not very profitable versus vehicle financing but cash flow is cash flow nontheless.  Some dealers make millions but it's based on volume.  They may gross $1500 on your purchase but after they pay their bills most end up actually profiting $150.  So don't lowball them too much as it just sets a bad tone.  Plus dealers have a tendency to do alot more for a customer they made a profit on.  Small things like putting on your new license plates or washing it don't seem like a big deal but can save you time, money, and hassle.

My recommendation once you know what your needs are and how much cash you have, the monthly payment you can afford (after gas, insurance and a little repair/maintenance fund), get on the web and hunt for vehicles in your price range.  My favorite sites as a consumer as well as a dealer are Craigslist and AutoTrader.com.  Craigslist postings have a tendency to be cheaper but buyer beware.  You can also buy from other consumers but be prepared for an extensive hunt, title issues, and some creepy experiences.

Getting a feel for what you can get for your money, send the dealer an e-mail to ensure the vehicle is still there, and then go visit on a Sunday if you want some time to think.  If you are ready to buy, need a car or truck really fast or have some questions then by all means go on a Saturday.  At 9995 Motors Saturday is my biggest day of the week.  You can also get very lucky at end of month as we need to pay our rent on the first.

Come with your cash in hand and use it as a bargaining chip.  Learn about the car, drive the car, and once you find the best of the three for the money you have, offer them a reasonable price based on your websearch. 

You may want to take the vehicle to a repair shop to have them check it out - well worth the $100 or so at an NTB or other garage.  We have one across the street from us.  Many consumers hope by finding things wrong the price will go down but as dealers we price the vehicle based on the condition it is in but you would want to know yourself so you can plan your repairs and maintenance.

Many folks spend alot of time driving around hoping to find "the magic bean" but most of the time you'll find vehicles are priced right for the market these days.  There are some basic values out there like Ford Taurus, Ford Focus or Windstar Minivans, some folks like to stick with the Japanese hoping for some reliability - just depends what your needs are.  Chevy trucks, Ford trucks, Camrys and Accords seem to top most used vehicles lists but you will pay a pretty penny for the Toyotas and Hondas.

Once you have landed on the vehicle, then it's transaction time.  More on that in later postings.

If you have found this helpful or interesting, then send me a note!

Your Car Insider

Wednesday, November 25, 2009

Topic One - Where I get my info

I worked for one of the big three for seven years in sales, coming in contact with 150 or so dealers learning from each one of them as well as from the factory itself.

I most recently became a used car dealer and have done every aspect of that business from beginning to end, license through launch, auction through titleing at the DMV.

I am currently also employed full time in the parts and service business so whatever aspect interests you then let the questions or observations fly!

Your Car Business Insider Launch

Buying a car or truck?
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Like to buy and sell cars and trucks?
Currenty a dealer or factory employee?
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Industry veteran from factory and dealer side has created this blog for you!
Ask away!