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There are plenty of car shopping tips that I can dole out before your next trip to the dealership.  However, it’s 2023, and the process of buying a new or used car at a dealership is a little different. I spent over four years selling new and used cars and understand the car buying process very well.

Believe it or not, buying a car isn’t as straightforward as you may think, and there are many pitfalls if you’re not careful. In case you’re unsure of how to go about shopping for a car this year, here are five car-shopping mistakes that you should avoid when shopping at a dealership.

1. Don’t go car shopping at the dealership without planning ahead

A lineup of Ford F-150 models at a car dealership in California, lined up in a way that's convenient for car shopping.
Ford F-150 models | David Paul Morris/Bloomberg via Getty Images

Don’t think about car shopping at a dealership without researching first. I recommend going online and checking out your local dealerships’ inventories to see what they have in stock. If you can narrow down your choices to a few options, that would be great.

That way, you can save a lot of time by going directly to the dealership that has the car you want. A car purchase should not be an impulse buy.

Also, if you plan to trade in your current car, some trade-in car value tips include looking up its value on Kelley Blue Book or Edmunds first to get a ballpark idea of what it’s worth. That way, you’ll know whether the value the dealership offers you is a fair one.

I also recommend having your car appraised at CarMax or a few different dealerships if you have the time. Doing so will give you a better idea of what the car is worth. Remember that those car value sites I mentioned are mainly guides as to what the market says your car is worth based on its mileage, trim level, and location.

When a dealership appraises your trade, they’ll be able to see any damages done to it, including wear and tear, and appraise it accordingly.

2. Don’t hide your trade when car shopping

A Carmax salesperson sells to a customer.
Carmax salesperson | via Getty Images

Many car websites will advise you to “hide your trade” when car shopping, which means you should not discuss your trade until the price for the new car is agreed upon. I recommend not doing this.

Hiding your trade until after the negotiations will not help your case and will only add more work (and time) when getting the deal done. Ideally, you should have the dealership appraise your car while you test drive and discuss the new car.

After your old car is appraised, the salesperson can factor its value and any money still owed into the deal. That way, the process will be streamlined, and you can still negotiate the trade value and new car price simultaneously.

3. Don’t automatically finance with the dealership

A financing sign showing 2.9 percent on a dealership lot.
A sign advertising financing on a dealership lot | via Getty Images

Whether you’re shopping for a car at a traditional dealership or a used car retailer like CarMax, I recommend finding your own financing. Most dealerships are essentially a one-stop shop when purchasing a car, and they will try to get you to fill out a credit application right away.

After doing so, the dealer will find the best interest rate and loan terms through the banks they work with. However, the “low rate” may not be the lowest.

Instead, shop for an auto loan beforehand and let the dealer know you already have the financing squared away. Many banks and credit unions offer lower interest rates, especially if you already bank with them.

4. Don’t negotiate on the monthly payment when car shopping

A car salesperson talks to his customers
A car salesperson talks to his customers | via Getty Images

If you plan on financing, negotiate the car’s out-the-door price, not the monthly payment. Suppose the salesperson detects you’re a “payment buyer” mainly looking for the lowest monthly payment. In that case, they can extend the loan term with possibly a higher interest rate to meet your desired monthly payment goal. Ultimately, you could pay more for the car despite the low monthly payment.

5. Don’t be afraid to shop around

I can’t stress the importance of shopping around for a car enough. The power of the Internet makes it easy to look for a car outside of your local vicinity and even out of state. Doing so will allow you to find the exact car that you want and at the price you want it for.

Avoid these car-shopping mistakes when buying a car from a dealership

Although it may be tempting to go about your old ways of hiding your trade and going from dealer to dealer to look for a car, don’t do it. Follow these tips, and you may be able to find the car that you’re looking for at the price that you want it at this year.