At first glance, a pre-owned vehicle of this caliber may appear to have excessive usage for its age, due to the number of miles accumulated over such a short period of time. But one thing to consider is that these vehicles are initially owned by large publically traded companies who maintain rigorous maintenance routines on their vehicles. So, these vehicles are typically serviced every 3,000 to 4,000 miles according to the vehicles manufacturers recommendations, which may suggested that the vehicles mechanical systems are functioning without any problems. Keep in mind that with most vehicles original manufactures’ warranty now extending out as far as 60,000 miles that these pre-owned vehicles still have a good portion of its original warranty remaining. Additionally, with the emergence of extended warranty products, someone can now purchase extended warranty coverage that can extend a pre-owned vehicles total warranty coverage beyond 100,000 miles.

Nonetheless, to get the right pre-owned vehicle at the best price you need to do your research by obtaining the vehicles history report (Auto Check or Car Fax) as well as other due diligence procedures. For further guidance on collecting information on a vehicles history and analyzing the related results consult with one of our Members Auto Choice (MAC) sales consultants.

More About Susan

Susan, a native Georgian, is the latest addition to the MAC family. She graduated from high school and completed coursework with Clayton State and The University of Clemson and has utilized her multi-faceted talents over the years as a graphic artist and jeweler, as well as years of experience with sales. Susan has been a Georgia Bulldog fan…read more.

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MAC Athens Office
155 Hawthorne Park
Athens, GA 30606
706.543.7450 – Phone

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Generally speaking, you want to negotiate the price of the vehicle you are looking to buy prior to allowing a dealer to even know anything about your trade-in. Sales people at dealerships are trained to get the keys to your trade prior to taking you on a test drive so that their used car manager can be appraising your trade while you are falling in love with their vehicle. They like to make it seem as though they are getting two things done at once to cut down on the amount of time it takes you to complete the purchase, but that is not the real reason for this process.

The real reason is that while you are test driving their vehicle then the salesperson is getting details and asking you questions about your trade in. He asks things like how much you owe on the trade, how much you think your car is worth, and what amount will it take to get this deal done today.

When you answer the salespersons questions you are arming him with valuable information.

When you arrive back to the dealer’s lot after the test drive, the salesperson goes to get your keys from the used car manager and it is at that point he fills the used car manager in on exactly what it will take to complete the deal.

So let’s say you have told the salesperson that you need $10,000 for your trade-in and the black book used car guide states your trade in is worth $8,000, which in no way means that a deal can’t be put together for you. All that means is that they have $2,000 less negotiating room on the price of the vehicle that you are looking to purchase. The salesperson will come back to you and give you the trade in allowance (the amount that you have already told him you wanted to hear) and you will never know the true ACV (Actual Cash Value) of your trade-in.

The more efficient way to handle this is to not even discuss a trade-in until after you have negotiated the price down on the dealer’s vehicle. This will give the dealer less of an opportunity to make additional profit on your purchase.

A lot of people refer to this process as flipping the numbers. Most consumers know that it happens but do not really know how to prevent it from happening.

Consumers these days turn to the internet to obtain values on their trade-ins but the reality is that the dealer is the one who has access to the true value of your trade-in. No dealer will pay you more for a car than he would pay if he went down to the auction to buy a similar vehicle.

So if you are out car shopping and one dealer tells you a trade-in figure several thousand dollars different than other dealers, rest assured he is flipping the numbers. In the end you will need to look at the bottom line (the amount financed) to determine if your purchase is a good deal. It doesn’t hurt to get the information that the internet offers you regarding the value of your trade in but the true test is when a dealer offers you a fair trade in amount after you have already agreed on a price for the car you are trying to buy.

Contact MAC today to learn more about the car buying process.

A Negative Equity position simply means that the trade-in value of your car (what your car is worth today) is less than what you owe on the car (your loan payoff balance). For example, let’s say that you currently own a 2005 GMC Truck that has 90,000 miles and the trade-in value quoted to you is $6,000; however, the loan payoff is $7,500, which results in the negative equity ($1,500).

Essentially, there are three ways to overcome negative equity on your trade-in. The simplest alternative is to drive your car until it is completely paid off. In other words drive your car until “the wheels fall off.” The second alternative would be to find a car to purchase that has enough equity spread to cover your existing negative equity. The third alternative is to put cash down to cover the negative equity.

Equity spread as mentioned above is the difference between the purchase price of the new vehicle being acquired and its related bank retail loan value (or the NADA Retail Loan Value). For example, let’s say that you are purchasing 2006 Infinity M35X with 56,000 miles on it for $25,000 and the Bank retail Loan Value is $28,225. As such, the equity spread would be $3,225. The bank retail loan value is the maximum amount of money the Credit Union will loan on any vehicle.

Equity spread will give you the leverage needed to roll any negative equity into the new vehicle being financed. In the two examples mentioned above you would be able to roll the negative equity from the 2005 GMC Truck ($1,500) into the financing of the 2006 Infinity M35X.  For further assistance with finding vehicles that have equity spread benefits contact MAC today.

I haven’t paid the dealer a check, so I don’t have to buy the car.
This is false. You plan on obtaining financing at your credit union, but you don’t have the check in hand yet. The dealer will ask you to sign their contract so they can let you leave in the car until you bring a check back from your credit union. You may change your mind about the car, but once you sign a retail installment contract with a dealer, the dealer has obligated you to purchase the car and can decide to “cash that contract”. At that time there is nothing you can do. Your signed contract is legally binding.

Certified used cars are the best.
Another myth is that you have to purchase a certified car in order to get a good used car. This is 100% inaccurate. Manufacturers use certification as a tool to make the dealer additional money. It forces the consumer to purchase a vehicle from a franchised dealer. These dealers have overhead to pay and they pass these costs along to the customer. They also have multiple profit centers such as service departments and parts departments they will pressure you into using. Don’t be fooled by the word “certified”. Let a MAC representative educate you on the full pre-owned market.

I’ll get a better deal at the dealer if I wait until the end of the month.
Most people think that if they wait until the end of the month dealers are willing to drop prices to meet sales quotas. This is 100% inaccurate as dealers pay the same amount for cars at any point in the month as will you.

Learn more about the car business with a free consultation with a MAC representative nearest you.

Title washing clears away a vehicles branding. Once the branding is eliminated, the car’s value goes up and it’s a lot easier to sell. You can see why so many car owners might be motivated to “wash” their titles. Titles are washed by transferring a salvaged vehicle to a state that doesn’t recognize the brand. When the state issues a new title, it may no longer show that it had been salvaged. If the salvage brand still exists, the seller will move it from state to state until the branding is gone.

Consumers can do an AutoCheck which tracks a vehicle’s history even if it’s moved to another state. Once a vehicle has been branded and that information is reported to AutoCheck, it remains on the record no matter how many states the car is moved through. The title may no longer indicate severe damage, but a vehicle history report will. “Washing” a title doesn’t wash away computer records. Every car at MAC comes with AutoCheck.

Paint thickness meters are fast and easy to use when you are looking for differences or discrepancies in the thickness of paint. For instance, we have found that on most German and Japanese cars, the paint thickness, using the paint meter is between 4 to 5 mils. We go around the car the first time, just putting the paint meter & gauge on each panel one at a time. Then we check the paint thickness on the whole vehicle.

For example, let’s say we start at a rear quarter panel. You put the paint meter on the left rear of the car. The paint meter reads 4.0 mils. Then go to the rear door and the meter reads 4.5 mils. Then the driver’s door reads 5.0 mils with the paint meter. That is within normal factory paint specifications. Then put the paint meter on the hood and it reads 10 or 12 mils. Since all the car factory paints normally run between 4 to 6 mils or 6 to 8 mils, when you get up to 11 mils and above the paint is either very thick or there is putty/Bondo underneath from a repair job.

Discovering hidden knowledge about the vehicle is the reason we use a paint meter here at MAC. Contact us today to arrange a demonstration.

Most lenders look for credit scores above 700 to lend to. In today’s economy maintaining a 700 plus credit or beacon score takes a lot of work and discipline. You must pay all of your bills on time and live within your means in order to maintain a positive credit rating.

Since interest rates are based on risk it is fair to say that the lower the beacon score, then the higher the interest rate. When consumers do not repay debts within the terms that they agree to with a lender their credit rating is affected. Once your credit is affected it can take years to repair it and get it back to a 700 plus score.

There are several factors that go into a credit/beacon score.
Some examples are:
a. The amount of debt you owe relative to the high credit a particular bank has loaned you (in other words your maximum credit line).
b. Slow payment history or in other words not paying a certain creditor on time.
c. Allowing too many creditors to pull your credit report. This happens when you are shopping for financing through a dealership or other potential creditor. When you sign a credit application you are allowing them to look at your credit and also authorizing them to send your credit to as many banks as they see fit.

When a conventional lender is not willing to take a risk on your credit as a result of a lowered beacon score then you are automatically moved over to what is referred to as the subprime market. The subprime market is primarily for higher credit risks. Remember the higher the credit risk the higher the interest rate—when you are placed in the subprime category you will pay more interest for items that you cannot afford to pay cash for. That means a higher interest rate on credit cards, cars, home loans, boat loans, etc.

So keeping on the topic of cars and the subprime market, let’s explore two different types of subprime lenders.

The first is the larger subprime lender: these lenders cater to the beacon scores that range from 600 to 690. They offer rates that are usually 6 to 8 percent higher than conventional rates so usually anywhere between 12.50 to 19.00%. Often, these lenders require a significant down payment to minimize their risk. The lender dictates the type of car you are able to buy as well as the loan terms. The lender charges the dealer a loan acquisition fee. This fee is basically profit in their pockets to offset their losses on the back end as their repo rates will be higher than conventional lenders. These lenders will generally require an automated debit from your checking account for monthly payments.

The next type of lender in the subprime market is the Buy Here Pay Here lenders/dealers (BHPH). When you are buying a vehicle from a BHPH dealer you are considered the highest credit risk. The average credit score for a BHPH client is 500 to 600. Most BHPH customers have usually been rejected by traditional dealers and the first category of subprime lender. These customers have most certainly not paid his/her bills on time or not at all.

BHPH car dealers know that their clients are high risk and therefore set an average interest rate of 29%. After doing research on the BHPH market most dealers charge the maximum the state allows. All BHPH dealers maintain detailed records of who your friends and family are and keep up to date information on where you live, work, worship and/or go to school. Generally they mail out free oil change coupons or some other type of gimmick or giveaway to get you to come in so they can update your records.

They all verify every piece of information on the loan application before they let you leave in the car and the average cost of the cars that they sell is $3,000 to $14,000. If you are forced to buy a low end cost car at about $3,000 they will require at least half of the cost of the car for a down payment. If you get to a higher value car then the BHPH dealer requires a more significant down payment and the higher value vehicles usually go to the established client or the repeat client.

Usually, the BHPH dealer requires a large down payment. The typical down payment is equal to about 60 to 70 percent of what the dealer paid for the car.

The average BHPH dealer does not spend a lot of money up front on the maintenance or repair of the vehicles they sell. This includes cosmetic items as well as mechanical items. They generally wait until the client pays them for 6 months or so. This tells them the trend of how that particular client will pay them for the life of the loan.

Most BHPH dealers do not report to the major credit bureaus in an attempt to control the client. So while you may be making on time payments, a criteria for improving your credit score, this information is not reported and therefore not affecting your score. This keeps the clients credit score low so they do not have the ability to move from a BHPH dealer to a subprime or conventional lender.

The average gross profit for a BHPH dealer is $4,500 to $6,000. This sounds extreme, but they are lending to clients that have a proven track record of not paying their creditors in a timely manner. Also it takes the full loan term for the dealer to collect his full profit.

The average loan term is 30 to 42 months. BHPH dealers collect their payments weekly to ensure they are the first to get their payments before their clients pay anyone else.

The automotive industry had a very difficult year in 2008. A credit crisis, volatile gas prices, both inflation and deflation, and other economic factors combined to create some unprecedented economic challenges for both new and used car dealers. While franchise sales and profits declined, BHPH dealers did not suffer the same fate.

The car industry lost approximately 5000 franchise and independent operators in 2008. Prudent operators will provide financing to better credit quality customers only after increasing their down payments and repayments from historic levels. Such increases will enhance their profits and cash flow and reduce their losses and mitigate risk. These changes are necessary because capital availability when America emerges from this recession will be more limited.

If you have had credit problems and you do not want to limit your choices please go see a representative at your credit union. These credit union employees are trained to help you understand your credit as well as guide you to make wiser financial decisions.

Please do not let your low credit score hinder you from going to your credit union and working to reestablish your credit score. Credit union representative can help get you into a car that is reliable with an interest rate that is based on your total picture.

Do not allow yourself to think that you have no options when it comes to buying a car. You are in control of your own credit and also what interest rate you will get when you do come in to apply for a loan.

Learn more about the car business with a free consultation with a MAC representative nearest you.

Franchise dealers have a checklist that they use when you purchase a new car and this is part of the reason the process takes so long. Each manufacturer sends consumers that have recently purchased vehicles from dealerships a survey. In that survey there are several questions that inquire whether a consumer was introduced to a service representative. The manufacturer offers incentives to each dealer that receives all 5′s or top ratings as a result of those surveys.

Now you know their motivation for steering you towards their service department. But when your vehicle is still covered under the manufacturer’s original factory warranty, the best place to have it serviced is at a dealership of your choice. That means even if you purchased the vehicle 500 miles from your home and there is a service department 5 minutes from your home, then be assured you will be welcomed with open arms to have your vehicle serviced at the closer dealership.

Revenue from service consumers accounts for a very large portion of profit for franchise dealers and therefore is essential for them to keep their doors open to serve. However, when your car reaches the point where it is no longer covered under the factory warranty you have a choice to make.

Franchise dealers or independent shops? There are pros and cons to each of these avenues, so answer the following questions and then decide. Do I have a trusted service adviser at my dealership now that does not try to upsell me repairs that my car does not need? Are my services completed in a timely manner? Is the staff at the dealership friendly and courteous? Do they respect my time? Can I afford their prices?

Independent repair businesses account for more than 70 percent of vehicle service and repairs according to the Automotive Aftermarket Industry Association (AAIA). This number is compared to 28 percent of non-warranty repairs by franchise dealerships. There are more than 130,000 independent repair shops in the U.S.

If for any reason you are not happy with your current mechanic or repair facility then it may be time for a change. When looking for a mechanic, start with an ASE certified mechanic so you will be assured they are up to date on the latest technology. But, most of all look for a professional that you feel totally comfortable with and who will answer as many questions as you have. Buying a car can sometimes be a headache and maintaining one can be too. Getting involved in the process and getting to know the people that work on your car will go a long way towards reducing a potentially stressful situation.

Contact MAC for a free car buying consultation

These devices can be used to store the images captured by the cameras as well as the text from each license plate. Some can even capture a photograph of the driver of the vehicle. These systems commonly use infrared lighting to allow the camera to take pictures at any time of the day. Usually a powerful flash is included at the intersection monitoring cameras, serving to both illuminate the picture and to make the offender aware of their mistake.

ANPR has also made its way to collection agencies around the US. These agencies are using this technology to locate their collateral when a client has failed to make payments on their loans. This technology is just one of the ways that car dealers and financial institutions are using to track their collateral.

So, at the end of the day, if you are past due on your car loan or you foresee a financial hurdle coming your way, it is better to communicate with your lender and work out a mutually beneficial arrangement than to take your chances trying to hide your vehicle. Hiding a car is never the answer to a temporary financial hardship and with ANPR at your lender’s disposal it is a lesson in futility.