By doing it this way, I have reframed the transaction. The ball is in their court. They know I’m serious, and that if they don’t deal I’ll probably find someone else who will. So the pressure is on them to perform.

Does this always work? Of course not. Often, they don’t call back. But if they really want to deal with me — they’re the ones who have to come up with a starting price. Then, I can negotiate from a position of greater strength.

5) Beware of Add-ons. Car dealers love add-ons. They can be big revenue generators for the dealership — but, not always so good for the buyer. I know one luxury car dealer that puts expensive, non-factory tires on its new showroom cars. Why? Because if a buyer either likes the special tires, or is too inhibited to tell the dealer to pull them off and replace them with the original factory tires, the dealer makes an instant $800 extra on the sale.

While that may be a more creative type of add-on than some dealers come up with, add-ons are by no means a new idea. Beware of these budget busters when you buy a car. Little things like extended warranties, rust proofing, credit life insurance, and dealer-added accessories should be bought with caution, and a full awareness of what they do to the total price.

6) Learn How Trade-in’s Work. There are different strategies about trade-ins, but my experience selling cars taught me that trade-in pricing is often used to flatter and confuse prospective buyers. Here’s what I mean: Suppose you are interested in buying a car with a $20,000 sticker price. The dealer might offer you $6,000 trade allowance on your old car, leaving a trade difference of $14,000. Feeling pretty good, you say to yourself, "Wow, $6,000 for that old junker—that’s more than anyone else will ever give me! I’d better take this deal while it’s still on the table!" But in the rush of the moment you forget that you’re basing the trade-in value against the full, non-discounted price of $20,000.

If you really want to know what your old car is worth to the dealer, there’s a better strategy. Start your negotiation by telling the salesman not to factor your old car into the trade yet. Instead, ask for a price based on a "straight" sale without a trade-in. Then, when you finally hammer out a price of $18,000, say, "If I wanted to trade my old car in on the deal, how much would you give me for it?" Now, he’s stuck and has to tell the truth that the bottom-line is still $14,000 — and that they’re really only allowing another $4,000 for your old car.

It may hurt your feelings a little, but it will help you make a more informed decision. You may decide to sell your own car at a price closer to what the dealer would turn around and try to retail it for.

7) "Bait-and-Switch" Is Not A Forgotten Art. Have you ever seen a car dealer billboard or newspaper ad promoting a vehicle at an unbelievable price? Don’t be surprised if you arrive at the dealership only to find that "we sold the last one of those just last night, but I have something else that you’re going to like better." Then you find out that the "something else" is not only better — it’s also a lot more expensive.

Low-balling and bait-and-switch games are still around. Don’t let new car fever short circuit your common sense.

8) Don’t Put Too Much Trust In "Book Value." I am not convinced that a book value always has much relationship to what a car is truly worth in the real world. Remember, a car’s value is what a motivated and informed buyer is willing to pay for it. Book values can be based on wholesale value (what a dealer might pay to buy a car before he adds his retail mark-up). This number may not help if you want to know what your car may be worth to a retail buyer.