you how car dealerships rip you off

you how car dealerships rip you off using the Foursquare method so I graduated in December of 2010 with a finance degree when there was still blood in the streets and unemployment was at an all-time high so instead of sitting around on my couch watching Netflix and you know eating potato chips I decided to get a job couldn't find a job in finance so what did I do I ultimately got a job selling cars right so selling cars there's nothing wrong with that as a profession you can make a lot of money but at the end of the day I didn't just go to school for four years get my finance degree so I can do something that I can do without a high school degree right but I did learn a lot of valuable tactics and a lot of valuable skills that the dealerships use when trying to make money off of people right so if you've ever bought a car you may have seen this before this is what we call the Foursquare okay so up here you have your trade-in value this is the car that you're trading in over here you have the price of the vehicle that you're buying down here you have your down payment meaning the money that you're putting down towards the car if you're not paying cash and then finally you have the monthly payment down here meaning if you're financing the vehicle these will be your monthly payments so let's say for example you're trading in a 2006 Chevy Impala you want to get a new one right so you have a 2006 Impala with eight million miles on it what the what the actual car manager or the salesperson will do is in front of you they'll silently devalue your trade that's what we call devaluing your trade so while you're talking and he's asking you questions about the car you know he'll touch a little chip here a little dent there and notice that the wheels are scuffed it's all subconscious okay it's telling you that he knows that your car is a piece of junk right so right away he's actually silently devaluing your vehicle so when they come back to you with this Foursquare okay you're gonna have a trade-in value let's just say he wants to give you 4 grand for your piece of junk right they're gonna have a price of the car let's just let's just say you're buying a new Impala and we'll call this 24:9 these are all just hypothetical numbers down payment this is the money that they want you to put down let's just say four grand and then monthly payment they'll sketch out like three different scenarios right you'll have let's say five hundred dollars at sixty months four seventy-five at seventy two months and then they'll have like five seventy five or excuse me let's just call it four fifty at eighty four months okay so when they come back to you with this four square it's essentially a piece of paper with these four squares these are all meant to be negotiation pieces okay the dealership is really making their money on the monthly payment and also how much you put down so financing is by far the most profitable center within the whole dealership okay so when you go to the guys in the back to do paperwork and they're selling you rim insurance and warranties and all that stuff that's all junk for the most part okay that's the highest margin in the dealership the second highest is the service center so when you go to get your car serviced yeah you might as well be getting your rear end service because you're taking it right there and then lastly new cars are the least profitable area of the dealership okay think about it logically if you're a Chevy dealership and you get brand-new Chevy's what do you think of brand new Chevy's gonna cost it's gonna cost the same in Ohio as it does in Florida as it does in California as it does in Alaska it's a brand new car with an MSRP okay these dealerships are getting them for relatively the same price they can only mark up new cars so much the new car sale is the least profitable center for the dealership remember that the used-car is actually way more profitable than the new car and you'll see why that's exactly from this Foursquare so what will happen is you guys are negotiate on a car you pick out a car you like you test-drive it you like it you smell it you touch it all you're in love right especially when you're coming out of this piece of junk here so they sit you down at the table would you like a cup of coffee oh here's my manager you you know oh this is Mike yet nice to meet you thanks for stopping in today blah blah blah right it's all an act it's Hollywood so what they do is they come back with this for square this piece of paper that has these numbers on it and the numbers are meant to offend you okay they're meant to get you into kind of like oh my god these are so high what is this you know this is crazy because what they want to do is they want you they want you to beat them up too so you feel like you got a deal right it's all perception and perception is reality so the salesperson is going to say ok

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