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Understanding New Car Dealer Invoices, Dealer Costs and Holdbacks- Get a Great Deal on a New Car in #location_state_full#

February 19, 2014

If you are in the market to buy a new car, truck or SUV, take advantage of the wealth of information that the internet provides. In the old days you would have to drive from dealership to dealership and compile all the quotes from various dealers, who has time for that? Lucky for you, in today's day and age you can request as many price quotes as you want online and compare them, without driving to the dealerships.

Get started today, request your free no obligation to buy new car price quote, it's quick, it's easy and best of all it's absolutely free and you can request as many quotes as you want.

Car Buying Terms You Need To Know

There are a few common terms you need to be familiar with if you want to get a great deal on a new car.

Dealer Invoice Price: New car dealer invoices refer to the price the car dealer is charged for the new vehicles, from the manufacturer. But keep in mind that this is technically not the true cost of the vehicle to the dealer.

MSRP: This is the manufacturer's suggest retail price, it is the price that the manufacturer recommends that the vehicle should be sold for, however the dealership is under no obligation to sell the vehicle for this amount.

Deal Cost: The dealer cost is how much the dealership actually has to pay for the vehicle. This takes into account all the holdbacks and incentives that the manufacturer may be offering the dealership. To get a rough estimation of the dealer cost, subtract the manufacturer incentives and holdbacks from the dealer invoice price.

The Dealer Holdback and How You Can Use It to Get A Great Deal on a New Car

The dealer holdback is a 2-3% amount that is added on to the MSRP or new car dealer invoices. It is used to give the dealer some extra cushion so they can afford the costs associated with keeping the vehicles on the lot. The holdback amount is returned to the dealership, from the manufacturer, once the vehicle is sold.

Due to the existence of the dealer holdback, the actual cost of the vehicles to the dealer, is lower than the invoice price. Knowing this will allow you to negotiate a great deal on a new car, because you know that even if a car dealer sells to you below the dealer invoice price, they can still make money due to their holdback. Some dealers may not want to part with any of their holdback cash, but if they are especially desperate to make a sale they may be willing to cut their profits if it means getting the car off the lot or the showroom floor.

New Car Financing Options

First of all, before you look into buying a new car you should know your credit rating, having bad credit will seriously limit your choices for good deals. If you find that you have bad credit you may want to work on improving it before buying a new car.

If you have good credit, check with your local bank or credit union, they may be able to offer you a favorable rate. Generally you will get better rates from your own financial institutions verses the dealership, so make sure to check with them first.

You can then see what type of rates the dealership will offer you and compare them to what you're getting from your bank. Take the best rate and drive off happy!

Get started on your new car shopping today, request your free no obligation to buy new car price quote today! Uncover the new car dealer invoices and put your negotiating tools to work!

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