- Columns - Current and Archives
- Looking Back by Jack Lebo - February 2012 >
- Murphy's Law - July 2013>
- Murphy's Law - May 2013
- Murphy's Law - April 2013
- Murphy's Law - March 2013
- Murphy's Law - February 2013
- Murphy's Law - January 2013
- Murphy's Law - December 2012
- Murphy's Law - November 2012
- Murphy's Law - October 2012
- Murphy's Law - September 2012
- Murphy's Law - August 2012
- Murphy's Law - July 2012
- Murphy's Law - June 2012
- Murphy's Law - May 2012
- Murphy's Law - April 2012
- Murphy's Law - March 2012
- Murphy's Law - February 2012
- Murphy's Law - January 2012
- Murphy's Law - December 2011
- Murphy's Law - November 2011
- Murphy's Law - October 2011
- Murphy's Law - September 2011
- Murphy's Law - August 2011
- Murphy's Law - July 2011
- Murphy's Law - June 2011
- Murphy's Law - May 2011
- Your Money Matters by Thomas Sottile - February 2013>
- Taking Care by Lisa Petsche - May 2013>
- Taking Care - April 2013
- Taking Care - March 2013
- Taking Care - February 2013
- Taking Care - January 2013
- Taking Care - December 2012
- Taking Care - November 2012
- Taking Care - October 2012
- Taking Care - September 2012
- Taking Care - August 2012
- Taking Care - July 2012
- Taking Care - June 2012
- Taking Care - May 2012
- Travel Articles
- There's Much To Like About Tybee Island, Georgia
- PA’s Little Town Of Bethlehem Has Giant History, Pleasant Surprises
- Savannah Style: History, Food, Architecture And Even Ghosts
- Vacationing Beats Back Winter
- Visiting The Inn At Pocono Manor
- Delights of Northern Ireland
- Tuscana Resort near Orlando
- Belfast To Commemorate Titanic
- Protect Your Home While Vacationing
- Nearby Hampton Roads, Virginia
- New 'Heritage' Travel Division Formed
- Lifestyle Articles
- PAE-300 ‘Personal Audio Enhancer’ Brings New Sounds And Clarity To Television
- Seniors Desire To Stay In Home Has Led To Innovative Housing
- ‘Pleasantly Plump’ May Not Pose Serious Health Problems After All
- Spring Hills Brings Home Care, Assisted Living to S. Jersey
- Sense Of Family Obligation Remains Strong
- Becoming Bilingual Thought To Delay Onset Of Cognitive Impairment
- Comprehensive Study Provides Foundation For ‘New American Diet’
- Is Alzheimer's A Myth?
- Living Alone, Without Loneliness
- Chocolate In Moderation
- Expert: Forgiveness, Gratitude Are Essential For Healthy Aging
- Expert: No Limit To Length Of Life
- Media-Based Pennsylvania Veterans Museum Is Historic Treasure
- Joint Task: Take Action To Combat Knee Pain
- Want Better Performance From Portfolio? Watch Congress
- Conscientiousness Key To Longevity
- Men, Women 'Retire' Differently
- Sleep Problems And Cognitive Issues
- Newsworthy
- Binge Drinking Is A National Problem — Even With Senior Citizens
- Study Warns Of High Cardiovascular Disease Risks Of Eating Yolks
- Study: 'Old' People Smell Better
- Depression, Anxiety Are Key Factors In Impact Of Parkinson’s Disease
- Study: Don’t Worry, Be Happy For Better Cardiovascular Health
- ‘Chore Connection’ Provides Unique Services, Volunteer Opportunities
- Study Reinforces Benefits Of Regular Colonoscopies
- Study: 'Senior Moments' Begin Earlier
- Three New Studies Suggest Aspirin May Prevent Some Cancers
- No Sure Bet: Seniors Must Recognize Potential Gambling Problems
- Coping With Grief
- New Recommendation Creates Debate Over Prostate Screening
- High Salt, Low Potassium Diet Linked To Increased Death Risk
- Medical Director At HCR ManorCare Receives APPLE Award
- RomneyCare Awful Lot Like Obamacare
- Grandkids Safer With Gram/Pop At Wheel
- AARP: Recession Hits Seniors Hard
- Antidepressants Can Increase Danger of Falling
- Poll: Low Marks For U.S. Healthcare
- More Good News For Coffee Drinkers
- Book Reviews
- We The People
- The Immortal Life Of Henrietta Lacks
- The Love Of My Youth
- The American Way Of Eating
- ‘Rin Tin Tin’
- Pity The Billionaire
- Classic: Uncle Tom's Cabin
- A Stocking Full Of New Christmas Novels
- When China Rules The World
- The Submission - Amy Waldman
- My Soul's Been Psychedelicized
- Reckless Endangerment
- O'Nan's 'Emily Alone'
- Baseball In The Garden Of Eden
- Leisure / Entertainment
- Music - Donald Fagen's 'Eminent Hipster,' Jimi Hendrix Release
- Music - Two CD-Set Features Elvis In Hawaii; Eric Burdon Has New Release
- Music - Billy Joel's 'Love Songs' Set For Release
- Music - Paul Anka Shows Off His Versatility With Compilation CD Of ‘Duets’
- Music - Elvis, Otis Redding Fans Treated To Compilation Sets
- Music - Even At Age 80, Willie Nelson Flaunts Staying Power With Duets Album
- Music - New 63-CD Set Spans Much Of Johnny Cash's Career
- Music - Preservation Jazz Hall Band Celebrates Anniversary
- Music - New Releases Spotlight Garfunkel, Los Lobos
- Music - Television Pioneer Ernie Kovacs Featured In Two New DVD Releases
- Music - Simon’s ‘Graceland’ Album Celebrated With Anniversary Release
- Music - New Releases of Hathaway, Heart Music
- Music - Willie Nelson Still Producing New Music
- Music - New Release of Elvis' Work
- Music - 'The Sound Of Philadelphia'
- Music - Dave Brubeck, Hank Williams Reissues
- Music - Janis Joplin Showcased On 2 New CD Releases
- Music - Paul Simon, Jimi Hendrix Reissues
- Legal Articles
- Adult Children May Be Left To Pay Nursing Home Costs Of Indigent Parents
- Make A Resolution That Provides Long-Term Security
- Dialogue Helps Control And Direct Legal, Financial & Medical Matters
- Life Changes Can Require Revisions, Updates To Estate Plan
- Wills Create Solid Foundation For Effective Estate Planning
- Keep Or Shred? Know What To Do With Personal, Financial Records
- Recent Court Ruling Makes It ‘Open Season’ On Adult Children In PA
- Assuring For Care Of Your Pet
- Reader Resources
- Links To Government and Social Services
- Senior Discounts / bradsdeals.com
- For Advertisers / 2013
- To Subscribe
- Contact Us
- Submitting Letters To The Editor
Your Money Matters by Thomas Sottile, Esq.
Car Sense: Don’t Get Used
When Buying A Pre-Owned Vehicle
By Thomas Sottile, Esq.
Contributing Writer
Back in the era of the silent movie, the villain was the gent with the shifty eyes and handlebar moustache tying up the fair damsel on the railroad tracks in the path of an oncoming train. Galloping into Hollywood’s mythical Wild West, the outlaws wore black-trimmed Stetsons’ and crossing gun-belts as they parted the bar room doors.
In the anti-establishment 1960s, where no one over 30 was to be trusted, the arch-typical reprobate was the used-car salesman. Chomping on a gold-banded cigar and wearing a checkered shirt and skinny tie over an ample midriff, this caricature became a political piñata for at least one presidential candidate. His cartoonish poster image was haunted by the caption: “Would you buy a used car from this man?”
Fast-forward to the present and the used car salespersons generally are younger than most of us are. They wear team-insignia shirts and compete for customer service awards. Instead of horse-trading out on the asphalt car lot, we now negotiate in the comfortable confines of a showroom with piped-in music and free coffee.
By the way, that low-mileage creampuff you want to buy was “pre-owned” and not “used” by the little lady who only drove it once a week to church and back. And about that 1966 red Corvette convertible with the black interior that caught your eye, just look up the vehicle history report online to find out who owned it and where it’s been. Has anything else changed? Let’s see.
It still comes down to a desk with you on one side and the salesperson on the other. In the middle is the set of keys for the car that you just test drove. He has the car and you have the money, out of which comes his commission. If you are so inclined to write a check for the sticker price, including tax, and title, license, and document fees, minus any trade-in value on your old car, your salesperson should smile broadly. His or her pay is based upon the difference between what the dealership owns the car for (invoice price), and what the buyer pays for it, with a deduction for the dealer’s overhead costs, known as the “pack.”
If you purchase that pre-owned late-model creampuff for $20,000 and the invoice price is $17,000, it generates $3,000 over what the dealer bought it for. Subtract $1,000 in dealer overhead, and the seller’s commission on the profit, usually 25% or 30%, would be around $500 (.25 x $2000 = $500). As the profit decreases, so does the salesperson’s commission which no doubt he calculates in real time as the offers and counter-offers fly back and forth across the desk.
To a buyer, the pricing of vehicles on the back lot may seem incomprehensible with the same makes and models being sold for significantly different prices. But rest assured that the salesperson trotting along beside you almost always knows the invoice price. On some lots all of the vehicle sticker prices are raised by the same amount, say $4,000, over what the dealer paid. This makes it easy for the salesperson to know instantaneously by power of subtraction what kind of latitude he or she has to set the price on that offer you can’t refuse, and make a profit as well. Hence, bringing that $21,500 hatchback down to $19,950, if you are able to buy it today that is, still sets up a profitable transaction for the seller.
In entering into any significant business deal, such as a vehicle purchase, to be forewarned is to be forearmed. The public library has information available which is critical to any prospective buyer. Consumer Reports and other similar publications compare and rate cars, SUVs and trucks against competitors in their class for year after year, with archived copies in the reference section. Key factors are scrutinized including: cost, safety, fuel mileage, recalls, reliability, and overall owner satisfaction.
Also, the internet allows a prospective buyer to scour the market for the same or similar vehicle makes and models and find out what the community at large thinks is a fair used-car price. The Manufacturers’ Suggested Retail Price (MSRP) for a new car also can be found online. Telling the salesperson what you know already may be a great way to begin talking about what you think is a reasonable cost for a particular vehicle.
How we pay for that dream machine is another matter. Generally, the buyer has two choices: to pay in full or to finance over time. Financing increases the total cost of the car by the interest charged on the credit. Also, annual percentage rates (APRs) usually are higher and loan periods are shorter on used cars than on new ones.
The Federal Trade Commission’s (FTC) Used Car Rule (www.ftc.gov) requires dealers to post a Buyers’ Guide in every used vehicle they offer for sale, with the exception of motorcycles and recreational vehicles. The guide must state if the vehicle is being sold “as is” or with a warranty, and what percentage and types of repair costs will be paid by the dealer. A relatively new used car may have part of the original manufacturers’ warranty still in effect, which can be passed on to the next purchaser in most cases. Consumers also have the right to get the car inspected by an independent mechanic before buying it.
The Buyers’ Guide informs us to get all promises in writing, with mention of any major mechanical or electrical problems we should look out for. An important fact is that the guide becomes part of the sales contract and overrides any contrary provision. For example, if the guide says that the car comes with a warranty and the sales contract says the car is sold “as is,” then the dealer must give us the warranty described in the guide.
To achieve total transparency is most advantageous in any transaction. When bargaining for a used vehicle, however, certain important facts like what the vehicle costs the dealer and the true value of options and add-ons usually are not known to us right off. But we can take a tip from the astute blackjack player who calculates the probabilities of a winning hand based on the unseen cards remaining in the deck. Through our research and due diligence on all aspects of the deal, we can learn when to stand on our own bottom line, know a fair offer if one is made, or recognize that it’s time to walk off in another direction.
*
Thomas Sottile is an attorney in Media, PA. He retired from the U.S. Postal Inspection Service after 23 years as an investigator and attorney.
Car Sense: Don’t Get Used
When Buying A Pre-Owned Vehicle
By Thomas Sottile, Esq.
Contributing Writer
Back in the era of the silent movie, the villain was the gent with the shifty eyes and handlebar moustache tying up the fair damsel on the railroad tracks in the path of an oncoming train. Galloping into Hollywood’s mythical Wild West, the outlaws wore black-trimmed Stetsons’ and crossing gun-belts as they parted the bar room doors.
In the anti-establishment 1960s, where no one over 30 was to be trusted, the arch-typical reprobate was the used-car salesman. Chomping on a gold-banded cigar and wearing a checkered shirt and skinny tie over an ample midriff, this caricature became a political piñata for at least one presidential candidate. His cartoonish poster image was haunted by the caption: “Would you buy a used car from this man?”
Fast-forward to the present and the used car salespersons generally are younger than most of us are. They wear team-insignia shirts and compete for customer service awards. Instead of horse-trading out on the asphalt car lot, we now negotiate in the comfortable confines of a showroom with piped-in music and free coffee.
By the way, that low-mileage creampuff you want to buy was “pre-owned” and not “used” by the little lady who only drove it once a week to church and back. And about that 1966 red Corvette convertible with the black interior that caught your eye, just look up the vehicle history report online to find out who owned it and where it’s been. Has anything else changed? Let’s see.
It still comes down to a desk with you on one side and the salesperson on the other. In the middle is the set of keys for the car that you just test drove. He has the car and you have the money, out of which comes his commission. If you are so inclined to write a check for the sticker price, including tax, and title, license, and document fees, minus any trade-in value on your old car, your salesperson should smile broadly. His or her pay is based upon the difference between what the dealership owns the car for (invoice price), and what the buyer pays for it, with a deduction for the dealer’s overhead costs, known as the “pack.”
If you purchase that pre-owned late-model creampuff for $20,000 and the invoice price is $17,000, it generates $3,000 over what the dealer bought it for. Subtract $1,000 in dealer overhead, and the seller’s commission on the profit, usually 25% or 30%, would be around $500 (.25 x $2000 = $500). As the profit decreases, so does the salesperson’s commission which no doubt he calculates in real time as the offers and counter-offers fly back and forth across the desk.
To a buyer, the pricing of vehicles on the back lot may seem incomprehensible with the same makes and models being sold for significantly different prices. But rest assured that the salesperson trotting along beside you almost always knows the invoice price. On some lots all of the vehicle sticker prices are raised by the same amount, say $4,000, over what the dealer paid. This makes it easy for the salesperson to know instantaneously by power of subtraction what kind of latitude he or she has to set the price on that offer you can’t refuse, and make a profit as well. Hence, bringing that $21,500 hatchback down to $19,950, if you are able to buy it today that is, still sets up a profitable transaction for the seller.
In entering into any significant business deal, such as a vehicle purchase, to be forewarned is to be forearmed. The public library has information available which is critical to any prospective buyer. Consumer Reports and other similar publications compare and rate cars, SUVs and trucks against competitors in their class for year after year, with archived copies in the reference section. Key factors are scrutinized including: cost, safety, fuel mileage, recalls, reliability, and overall owner satisfaction.
Also, the internet allows a prospective buyer to scour the market for the same or similar vehicle makes and models and find out what the community at large thinks is a fair used-car price. The Manufacturers’ Suggested Retail Price (MSRP) for a new car also can be found online. Telling the salesperson what you know already may be a great way to begin talking about what you think is a reasonable cost for a particular vehicle.
How we pay for that dream machine is another matter. Generally, the buyer has two choices: to pay in full or to finance over time. Financing increases the total cost of the car by the interest charged on the credit. Also, annual percentage rates (APRs) usually are higher and loan periods are shorter on used cars than on new ones.
The Federal Trade Commission’s (FTC) Used Car Rule (www.ftc.gov) requires dealers to post a Buyers’ Guide in every used vehicle they offer for sale, with the exception of motorcycles and recreational vehicles. The guide must state if the vehicle is being sold “as is” or with a warranty, and what percentage and types of repair costs will be paid by the dealer. A relatively new used car may have part of the original manufacturers’ warranty still in effect, which can be passed on to the next purchaser in most cases. Consumers also have the right to get the car inspected by an independent mechanic before buying it.
The Buyers’ Guide informs us to get all promises in writing, with mention of any major mechanical or electrical problems we should look out for. An important fact is that the guide becomes part of the sales contract and overrides any contrary provision. For example, if the guide says that the car comes with a warranty and the sales contract says the car is sold “as is,” then the dealer must give us the warranty described in the guide.
To achieve total transparency is most advantageous in any transaction. When bargaining for a used vehicle, however, certain important facts like what the vehicle costs the dealer and the true value of options and add-ons usually are not known to us right off. But we can take a tip from the astute blackjack player who calculates the probabilities of a winning hand based on the unseen cards remaining in the deck. Through our research and due diligence on all aspects of the deal, we can learn when to stand on our own bottom line, know a fair offer if one is made, or recognize that it’s time to walk off in another direction.
*
Thomas Sottile is an attorney in Media, PA. He retired from the U.S. Postal Inspection Service after 23 years as an investigator and attorney.