Allocation: Also known as an incoming vehicle. This means that a vehicle is being built and sent to a dealership.
Dealer Cash: A manufacturer to dealer incentive. At a traditional dealership, this incentive is not always passed on to the customer.
Dealer Trade: If dealers do not have a vehicle in stock, they can trade with a local dealer to make the vehicle available to customers.
Documentation Fee: Dealers charge this fee to cover administrative costs associated with registration and title. This fee can range from $45-$500.
Drive Off: When leasing a vehicle, this is what the customer pays when taking delivery to reduce how much is being financed (includes any acquisition fees, taxes and licensing).
Invoice Price: The vehicle's cost to the dealer, not including holdbacks or other discounts.
MSRP: The suggested retail price from the vehicle manufacturer.
Out the Door Price: How much the car will cost the customer (includes the price of the vehicle, taxes, title, licensing fees, the documentation fee and any additional official fees).
Rebate: A manufacturer to customer incentive. Rebates are taxable in most states.
Upside Down: When the balance owed on a loan is greater than the vehicle's value.

When you make the dealer an offer, let them know that you are a serious buyer and you are ready to buy if the offer is appropriate. You should adhere to the following guidelines:

This question has been debated by many. An extended service contract can be a great thing to have, you just want to make sure it will be needed and it is at a fair price. It is like health insurance, if we knew we would never get sick we wouldn't buy it. Every manufacturer of cars has a shop and all cars breakdown. Often times, extended warranties serve as the auto dealers' big moneymakers. No matter how they spin the jargon, be sure you actually need one before signing anything! Extended warranties are nothing more than extended service contracts, which will cover the cost of certain repairs and problems after a car's factory warranty expires. Make sure to check the vehicle's original warranty and if there's any coverage left on it. Many warranties expire once you reach a certain mileage limitation or after a certain period of time has passed since purchase.

Example: If a car with a 36 month / 60km warranty has 15,000 kms on it but was purchased 3 years ago, it could be out of coverage. You should calculate how many kms you will drive per year and how long you will drive the car. If you are intending to keep the car a long time and drive a lot of miles per year, an attractively priced warranty might be a great decision.

More and more car manufacturers are surpassing the outdated three-year or 60000 km warranty, especially higher-end automakers. Acura, BMW, Cadillac, Volvo, Saab, Mercedes, Lincoln, Lexus and Jaguar are sold with four-year or 80,000-km warranties. Infiniti's vehicles have four-year or 120,000-km warranties. Hyundai and Kia offer five-year or 100,000-km warranties on new vehicles, plus 10-year power train warranties, which cover engine and transmission repairs. GM recently trumped all other warranties currently being offered by announcing a five-year warranty.

Most factory warranties are transferable to used-car buyers, but some warranties have restrictions, so be sure to check. If you paid to have your vehicle certified by the car manufacturer, then you have added warranty protection on your used vehicle.

Recently, many major car manufacturers including Honda, Ford, Lincoln, Mercury, Volkswagen and Volvo have heightened their warranties on Certified Pre-Owned vehicles. Several luxury automakers offer an additional two-year warranty on their Certified Pre-Owned vehicles. Others offer an additional twelve-month warranty after the new-car warranty expires. After determining how much coverage is leftover from the previous warranty, how long you plan on keeping the car and how much additional coverage you'll need, the next step is to negotiate your terms for an extended warranty.

Lastly, if you buy an extended warranty, remember that in most provinces you are allowed to cancel that contract at anytime and receive a prorated refund on the unused portion. Dealers don't always tell customer this, and some customers have sold cars and not asked for the refund when they were entitled to it.