Many people feel like they are going to be taken advantage of the moment they set foot on a car lot.  That’s not necessarily true.  A car dealership is simply a business trying to maximize its profits.  You, on the other hand, are trying to get the best deal.  Yet, it’s easy to give up your negotiating power by saying the wrong thing.  Here are seven things that you should NEVER tell a car salesman:

1. “I LOVE this car!” – No matter how beautiful, fast, shiny or perfect the car is, don’t let your emotions show.  If the salesperson sees your excitement, then he knows he has the upper hand and will play on your emotions.  He will push for the quick sale at a higher price by telling you that the car is really hot in the market, they only have that one, and that someone else was looking it that very morning.  Bottom line – the less emotion you show, the more negotiating power you have when buying a car.

2. “I need a car today” – Few things are worse than being in desperate need of a car.  Except letting on that you are in desperate need of a car.  The salesperson will again smell the quick and easy sale.  He will know that you aren’t likely to take the time to shop around for a better price. It also means you are more likely to take whatever he happens to have in his inventory, even if it isn’t exactly what you want.

3. “I have a car to trade” – Dealers like to move money around to confuse car buyers about how much they are really getting in the deal.  If you mention your trade up front, you are opening the door to the “shell game”.  The sales person will focus on what you want to get for your trade and may artificially inflate the “trade allowance” to get you to say yes.  This leaves no room to negotiate on the price of the new car.  Furthermore, the salesperson may ask to appraise your trade, taking your keys and literally holding your car hostage until you agree to a deal.

4. “My monthly budget is $X” – Car dealers LOVE monthly payment shoppers.  Focusing on the monthly payment allows the salesperson to simply extend the loan terms to 60, 72 or even 83 months to get you the payment you want without discounting the price of the car.  Instead of getting a good deal, you will be losing hundreds to thousands in interest by paying for the car for six to seven years.

5. “I have bad credit” – Dealers make a commission from banks and other lenders when they sell the financing.   If you tell the salesman that your credit is “bad”, he may immediately submit you to a “sub-prime” lender with higher interest rates when, in fact, you may qualify for a better rate with a traditional lender.  You should never shop for a car loan without knowing your credit score, and don’t be afraid to shop auto loans and get pre-approved from an outside bank or credit union before you go to the dealership.  Then ask the dealer if he can beat the rate you already have.

6. “I’m thinking about leasing” – This is the same as telling the dealer that you are a monthly payment buyer.  The salesperson will focus on the lease terms to get you to the monthly payment you want instead of negotiating the price of the car.  Negotiate the price of the car first, then negotiate the lease terms.

7.  “I’m paying cash” – Most people think they will get a better deal if they offer to pay cash.  In fact, the exact opposite is usually true!  If the dealer can make money selling the financing, they will have more wiggle room on the price of the car.  If you tell the dealer that you are paying cash, then he has less incentive to negotiate.

The truth is that most car dealers do not “take advantage” of people – they are simply better at playing the sales game.  After all, they get more practice at it than you do.  If you don’t educate yourself and keep your emotions in check, then you risk leaving a lot of money on the table.