HOW MUCH DO USED CAR DEALERS PAY for CARS? FIGURE IT OUT! 2022-2023 The Homework Guy Kevin Hunter

everyone wants to know how much the car dealers pay for the used cars because it's key to negotiations today I'm going to cover information that nobody is talking about and has never been covered on YouTube you my friend will no longer be in the dark on how much car dealers are paying for their used cars how awesome is that hi I'm Kevin hunter also known as the Homer guy and author of is that the best you can do this amazing video brought to you by YouTube's best channel on car buying and selling courtesy of the Homer guy team and our super high intensity training program for car buyers if you decide you like our message and want one of these awesome shirts or hoodies like this one we'll just check the merch shelf down below and suit yourself up there are three key strategies you can use to determine use car prices at a wholesale level and that information tells you exactly what car buyers are paying for their used cars you can choose to use one of the methods or all three to verify what wholesale cost of any vehicle is we are going to start by walking you through six vehicle scenarios on the market today for sale as of this recording and show you how much the dealer paid for these cars it is often said that Kelly Blue Book numbers are wrong you've probably heard it many times they get the trade wrong they get dealer prices wrong however you need to understand that even wrong numbers are useful when they are consistently wrong because if you know what the right numbers are relative to those wrong numbers you'll always know how to get access to the right information and that my friends is precisely what we're going to do here today we're going to show you how to use Kelly Blue Book to your advantage how to get dealers to tell you what the wholesale purchase price of a car is and how you can use your banker to get the ACV the actual cash value of any car on the market if you're a first-timer on the homework guide channel consider subscribing and leaving us a comment below add hashtag the homework guy if you'd like to response directly from Kevin or one of the homework I staff members we're always glad to help our loyal followers best part is there is no charge you can also email the team at info at the homework icon with a specific question or if you'd like a free contract review just blackout your personal information and send it to us we'd love to hear from you just be aware that we do get a lot of requests so just be patient while you wait for response back to you Kevin before we're done we're going to explain how you can get a dealer to tell you what any used car was purchased for and how you can get your banker to give you the actual cash value of any vehicle on the market that's coming up at the end before we do that we're going to start by giving you six scenarios of vehicles for sale right now in the market and how you can use Kelley Blue Book despite your understanding that these numbers are off to determine how much the car dealer paid for the vehicle some background and Kelley Blue Book for years car dealers have told the customers that Kelley Blue Book values are way off with the claim that it's outdated information they give no explanation beyond that they just say they're way out of date interestingly dealers use Kelley Blue Book numbers every day to send to their own bankers for in-house loan approvals and your own banker still uses Kelley Blue Book and that should tell you something what does the dealer know what does their in-house banks know what does your own banker know that you might not know and how to use this information to make decisions on car loans this gets so good well let me illuminate Kelley Blue Book updates their information on the odd months of the year the information that they put out online will be most accurate in the first week of January March May July September and November six months out of the year and all the odd months why then simple that's when they sync up their wholesale book values available to dealers and bankers only and then adjust their published trade values private party numbers and dealer retail numbers if you are looking up a vehicle in the early part of any odd month everything you see is reflective of current market values those numbers will move a little bit over the next 60 days but movement is generally so incrementally small that the little bit of difference it makes is almost no difference a majority of the time so if you understand all of this you now know that when a dealer tells you that Kelley Blue Book is out of date well they have never told you this story and now you're going to find out how to easily adjust any number on KBB to also get it right we're showing you the exact dealer listing for the vehicle and we're not going to hide the dealer who has it listed maybe you're in their neck of the woods and want to go wheel and deal on that specific vehicle well more power to yet all right let's get started cracking the code on how much car dealers pay for used cars every one of these vehicles that we go through we're gonna be looking at the load trade values on Kelly and showing you the bracket that the dealer is always targeting and then verify it with the other couple of methods that will show you at the end that's the number the dealer's gonna try to buy this vehicle every single time let's run through the scenarios the first vehicle is a black 2018 toyota camry LE has twenty six thousand three hundred forty one miles on it current dealer list is fourteen thousand nine ninety five if you booked this out in Kelly Blue Book let's jump over to the trade numbers on this so Kelly publishes a trade low trade mid trade high the only one that's important is to trade low it's at thirteen thousand seven thirty three what a deal is gonna try to do is buy this car from somebody trading it in at five hundred dollars below the trade low number or as much as $100 over so the range then becomes thirteen 233 to a high number of thirteen 833 a majority of the time those are the numbers that the dealer's gonna try to buy this vehicle at so let's take a $500 pack now a pack is commonly known as money dealer uses to recondition a vehicle but pack is the acronym PA c stands for protected against commission so now on this vehicle they own it for fourteen three three three if you add a 1250 dollar profit to this vehicle it comes out to a price of fifteen 583 this vehicle is listed at fourteen nine nine five compared to most dealer cars this is a steal the actual dealer profit on this vehicle including its pack is eleven hundred sixty two dollars we go now to a red 2019 chevy cruze LT this vehicle has seven thousand twenty seven miles on it it's listed at the dealer sixteen thousand seven hundred ninety dollars this go take a look over here at where the trade numbers are on kelly blue look the low number in trade is twelve thousand 153 - in the five hundred and adding one hundred gives us a bracket of eleven thousand six fifty three up to twelve 253 now we're gonna assume that they paid the high dollar and then added five hundred bucks to it for lot pack that gives me 12 7-5 3 and adding a dealer profit of $1,250 brings me to a price of 1400 3 the reason why this number is important is because you could negotiate all the way down to that number from its list price of 16,000 790 and this dealer would still be getting a fair deal for them however at the price they have it listed at that is dealer fat of two thousand seven hundred eighty seven dollars on here so after all is said and done including their pack number if this dealer sold it to you for sixteen thousand seven hundred ninety dollars they will make forty five hundred and thirty seven dollars on this vehicle here's a silver 2016 honda odyssey SE forty seven thousand nine hundred sixty-five miles on it listed at nineteen thousand 495 we jump over here to the kelly trade numbers the low number again is fourteen thousand 125 that gives it a bracket of thirteen six twenty five to up to fourteen to twenty five that's what the dealer paid the person who traded this vehicle in now we jump over here and add a dealer lot pack of five hundred bucks on to this brings us to fourteen seven twenty five a dealer profit of $1,250 brings us to fifteen nine seventy five the dealer could sell that car to you and still be okay but they're trying to sell it at nineteen thousand four ninety five that is dealer fat of thirty five hundred twenty dollars on top of the profits I've already shared so total dealer profits come to five thousand two hundred seventy dollars on this vehicle next is a silver 2017 mercedes-benz e-class III hundred forty four thousand seven hundred thirteen miles on this vehicle current dealer list is twenty eight thousand seven ninety five he trade numbers on Kelley Blue Book the loan number shows twenty two thousand eight forty eight gives us a bracket of twenty two thousand three forty eight and twenty two thousand nine forty eight assuming they paid the high number and adding the five hundred dollar lot pack gives me twenty three thousand four four eight that'd be the number they show on the books now that they own it for at at twelve hundred fifty dollar profit to it were at twenty four thousand six ninety eight this dealer again has it listed for twenty eight thousand seven ninety five four thousand ninety seven dollars in additional dealer fat and this dealer will profit when all is said and done five thousand eight hundred forty seven dollars on this vehicle next is a silver 2019 Chevy Suburban for wheel drive LT 30 2004 75 is the miles it's listed at 42,000 995 we jump over to the trade numbers you see this has a low trade value of 35,000 944 that gives us a bracket of 35 for 4 for up to 36 Oh 44 we take that number and add $500 gives us 36,000 544 now our dealer profit of 1250 on that vehicle thirty-seven thousand seven ninety four is what you could negotiate down to this dealer has the vehicle listed again forty two thousand nine ninety five so the dealer fat is five thousand two hundred $1.00 this dealer if you should pay the number they have it listed at expects to make six thousand nine hundred fifty one dollars on this vehicle now the greedy dealer of the Week award goes to a white 2017 Lexus NX 200t this vehicle has fifty three thousand three hundred eighty three miles on it it's currently listed at twenty five thousand Oh 79 we jump over to the load trade number that is seventeen thousand nine sixty one the dealer bought this for a maximum of eighteen thousand Oh sixty one we add in a five hundred dollar dealer lot pack to give us 18 thousand five sixty one add a dealer profit of twelve hundred fifty dollars to bring us to nineteen thousand eight eleven that is what the dealer could sell that vehicle for and still be just fine however they have it listed at twenty five thousand Oh seventy-nine that is additional dealer fat a five thousand two hundred sixty eight dollars if you let them sell it to you for that number seven thousand eighteen dollars is the profit this dealer expects to net on this car now if you noticed in each one of these scenarios we were always using the low trade number subtracting five hundred or adding a hundred dollars to come up with a range and that is the number that will generally be showing up on the auction numbers and that's the number that will generally be showing up on the actual cash value numbers that your own banker has that's the actual number of vehicle can be purchased for and dealers always adpacks this $500 pack was just an example but in many cases it can be twelve hundred dollars or two thousand dollars and then they're still adding a dealer profit on top of that just so you understand if you want to know what a dealer is actually paying out of pocket for a car you have to look at the low trade number and it's always at the high end of number the dealer is targeting now everything you saw here relative to Kelley Blue Book and how to interpret their numbers to learn how much car dealers are paying for used cars hits the nail on the head with in very close numbers plenty closely enough for you to know what the dealer is likely paying within a few hundred bucks they don't very much outside of that however I promise I'd give you two more techniques to determine how much a car dealer pays for a used car and you're going to love how this works here's the second strategy for determining how much car dealers pay for a used car and this strategy actually gets the dealer to give you the information you want first find a used car you're interested in that's available on the market right now then write down all the pertinent information the year make model trim level and additional information about value added items like bed liners or step rails grille guards etc things like that you also need the exact miles on the vehicle I can't stress enough you need an exact description and the exact miles now take your current vehicle to a totally different dealer not the one you found the vehicle at you that you want and tell them you're just getting started car shopping and would like to know what they think your car is worth on traded it's key to make sure that they think you're interested in working with them meet the used-car manager or the vehicle appraiser who is going to book out your current car and be clear that you're not starting your shopping process until you have a good trade appraisal emphasize that you just want to make sure that it's fair use the word fair when they give you an appraisal they will likely give you a Kelley Blue Book printout that shows wholesale value that book value that only dealers and bankers have and you'll notice it is that the lowest number shown on kelley blue book or right below it in the trade value category as if your car is in rough shape review the printout until the dealer the numbers are off and then explain that you're aware of Manheim one of the largest dealer auctions with wholesale prices on cars ask the car appraiser to look up the car on the auction and then have him show you what it's going for on Manheim the car appraiser thinks he has you now because those Manheim numbers are going to be right in the ballpark of what he just showed you on Kel Blue Book moments earlier as he goes through the list of cars write down the price Manheim has for your car next to the Kelly Blue Book wholesale price that he printed out for you moments earlier now that you've seen both numbers Kelly and Manheim make it clear that you think the information you're looking at is fair good stuff to know now you tell him you have another vehicle you'd like to trade in and give him the specifics on the car that you found at another dealer lot he'll understand that one driver can't drive in two cars so it's not here however you want the same info on that vehicle too with you watching have him go through the same search on your prospective vehicle when you're done you now have the wholesale cost of the other car you were shopping for as well the dealer just showed you what that car went for wholesale boom was it that awesome okay here's the third strategy getting your own banker to give you the ACV the actual cash value of a vehicle you're interested in buying don't do this until you're pretty sure this is the vehicle that you want again find the vehicle you believe you want from any dealer or a private party seller be pretty confident this is the vehicle you intend to buy so you should already have done all the test drives done all the homework and ready to move forward to putting numbers on paper call your own banker and let them know you'd like to apply for a car loan explain that you plan to put 20% or more down and finance the balance for a reasonable term ask them for the book value on the vehicle so you know if the car loan is a good value for you and low risk for them the bank officer will give you the ACV or wholesale book value of the vehicle you're wanting a loan for courtesy of your banker you have the same information you could have gotten from the Kelley Blue Book method we explained earlier or the method of getting the car dealer themselves to give you the actual cash value of the car you now have that information from three sources if you're not confident with any of these like I said you can use one used to or use all three you'll be amazed how close those numbers are and that will be just as good as any information the car dealer has on any given day of the week as far as wholesale prices for used cars for any of you good guys in the car business salesman finance officers dealer owner is used-car managers wholesalers whatever you do if you want to contribute to our future content on this channel feel free to email us at info at the homer guy comm and put in the title salesman who wants to help put that in the title or whatever your job title is used-car manager wants to help you'll hear back from us just like the many others who helped us and you can be a part of solving the problem in the car business today all right if you appreciate the video today consider giving us a thumbs up and leave a comment down below using hashtag the Homer guide share the video on social media with your friends and make sure you join us on Facebook and Twitter too we post notifications and other updates on other social media sites and answer car buyer questions there too if you love what we do and want to say thanks for the tip the PayPal and cash app links that you see showing up on the screen here you'll find them in the description box down below the Homer guy team has helped millions of car buyers with videos free contract reviews market updates and much more and will always have your back with more great content thanks everyone for coming back we'll see you on our next video or stop in to say hello on Facebook or Twitter it's been a great ride producing video for all of you and hearing your feedback you guys Rock I'm Kevin hunter until next time take care everyone [Music]

Channel: Kevin Hunter The Homework Guy

Views: 184,114

Keywords: Car prices, Car prices set record highs, used car dealerships near me, car loan calculator, Auto sales, Used cars, Car, Cars, Car dealers, Automotive news, Car news, Automotive, Vehicle tax, Vehicle fees by state, Auto Shop, Car parts, Auto market, car dealer finance office, rebates for new cars, car loan scam, dealer rip offs, market watch out for this financing scam, what to do when a dealer lied to you, illegal things car dealers do, what to do if a dealership rips you off

Id: KpbbM08tzEA

Length: 17min 26sec (1046 seconds)

Published: Sun Jun 28 2020