<prompt> Human: I have a friend who used to work for one of the largest and most prestigious car dealers in Texas. Today I sat down with him and talked about buying a new car and walked away looking at the experience in a whole new light. I figured Id share the things he told me with you guys. Im not saying he has all the answers, but he sold cars for a number of years and certainly has a great deal of experience.First, bring someone with you that you trust and is a bit more skeptical than you. I know this is pretty common knowledge, so I wont go too in depth, but you may think youre going to walk in and outsmart the salesman and heshe may get you excited about something you didnt realize before. Its nice to have a neutral third party, maybe even someone who doesnt want you to buy the car in the first place.Next, when you walk into the dealership for the first time, tell the salesman up front Hello, Im not going to be buying a car today, but I would like more information. Do this even if you are floating the idea of buying that day. This is going to bring the salesmans excitement level and expectations from Cloud 9 back down to earth. He is less likely to make promises and put pressure on you that he cant deliver on later and waste your time. By posing as just a person seeking information, you have increased leverage.Next comes the part on negotiating. Obviously Im sure you all know to never pay close to the MSRP on a car. My friend told me to shoot for around 4000 less than the MSRP. Lets say youre buying a new car that costs 30,000 MSRP. You offer the salesman 26,000. Of course he is going to huff and puff and tell you constantly there is no way they can do that low. So what do you do? You say thank you, Ill keep looking. Instantly he goes and talks to his manager. Keep walking away until you have the price where you want it. My friend told me that if you buy a car without talking to the manager at least once, youre leaving money on the table. The salesman doesnt have any leeway when it comes to price, but the manager does. My friend told me to try to walk away at least three times during the course of the deal. They will always go lower. Dont say yes until you speak to a manager.As far as discounts go, one thing he says many people dont realize is that every discount on the car can be negotiated separately. There isnt some package discount where if they offer you one they cant offer you another. One common trick that many people fall for is if the manufacturer is offering a discount, they take that discount and buy the car. By doing that you just effectively paid full price, and the dealer made 100 of what they asked for. Lets say you want to buy a Ford with a 30,000 MSRP, and Ford is offering a 10,000 manufacturers discount. The salesman excitedly comes out and says Great news, Ford is offering this 10,000 discount, we can sell you the car for 20,000. This discount just effectively brought the dealers original price down to 20,000. You can always negotiate further, and every discount can be negotiated separately. In other words, every discount is independent! If the salesman tells you he cant budge on one discount if he gives you another, hes lying. The manufacturers discount is always separate from the dealers discount.When you finally settle on a price with the salesman and sit down at the FI office, you may think youve just gotten a great deal and are ready to go home. This is what the dealer wants, because negotiating the terms of the financing is perhaps where you have the most leverage. At this point the dealer is tired and wants to make the sale. If youre financing, the dealer may tell you they called the bank and can get you a 5.5 loan. They may express this as an assumption and just breeze past it, like they dont have any control over the banks terms. This is wrong. The dealer will add an upcharge usually 1-1.5 on the financing. If you cant get them to budge, tell them you will just find your own financing. Do not trust the dealer to negotiate with the bank for you. Know the rate you want to finance for and negotiate to get that rate. Now that youre this far down the line, the dealer will do almost anything to make the sale. They already know they arent going to make a killing off of you, and theyre fine with that. Theyll just make it off the next poor guy or girl that comes in. At this point theyre offering you their warranties and all the bells and whistles you dont want to hear about. Although you might think that all these service packages and warranties are complete B.S., they are actually a good product that you may want especially if youre buying a luxury car. All of these warranties and service packages can be negotiated too! If the salesman offers you a warranty for 4,000, tell him youll buy it for 2,000. If he says no, tell him you dont want it. Youll get it for 2,000.At the end of our conversation, my friend conveniently told me a way to completely bypass all of the negotiations. Just walk in, find the car you want, and say show me the invoice, Ill pay 300 over it. If they say no, walk away. But this is a sureshot way to avoid all of the fees and charges they tack on the cost of the car. Youre paying them more than what they paid for it, even if its only a few hundred dollars. If theyre smart, theyll sell it to you.Hope this helps some of you looking to buy a new car! Ill probably add some more later.  <response>: When you are about to get to the final agreed upon price, you can negotiate even lower by eating into the dealer holdback.Also - you can typically find better deals to start with by looking at a dealers internet deals, and working with their internet sales rep. Not always, but its worth also looking at. Same negotiating rules apply.Another tip is the time of the month does make a difference. If a dealer needs to pick up sales towards the end of their month, they will sell a car at a loss in order to get their bonus money from the manufacturer for making monthly quotas. They end up profiting more from getting that bonus than they lost in giving you the car at below cost. 