For years, dealerships have been using a tactic called a “four square”—a sheet of paper divided into four boxes where the salesperson will write down your trade value, the purchase price of the vehicle you’re buying, your down payment, and your monthly payment. At the top, there’s usually a place to sign your initials to indicate that you intend to buy the car if you like the deal.
The details of the technique may have changed over the years since Consumerist reporter Ben Popken talked to car salesperson Allen Slone about the four square in 2007—we’ve seen “deal sheets” or “order sheets” without the four boxes—but the basic formula remains the same.
“It looks really unassuming on its face, but it’s designed to make you pay more and not realize what’s going on,” Slone explained in the Consumerist article. Salespeople will write in big letters, turn the sheet over, and write over and cross out numbers to make it as confusing as possible, all in an attempt “to wear you down and make you sign.”
Zach Shefska says the whole point of a four square is to focus a buyer’s mind on a monthly payment instead of the total price of the vehicle. “Sales managers are trained to talk about monthly payment. By talking about monthly payment, you’re obfuscating variables that are profit centers for the dealership,” he says. For example, dealers can raise the price of the vehicle but lower the monthly payment by stretching a loan from three years to six years.
Sometimes, salespeople will ask you to initial a piece of paper next to a written promise that you’ll buy the car if the numbers are agreeable to both parties. Ray Shefska says this is an attempt to shame buyers into purchasing a vehicle even if they aren’t ready.
“The sales manager can come out and say, ‘Doesn’t your word mean anything?’” In reality, Shefska says, “It’s just a ploy to say you signed it, you committed to it—there’s nothing legal about it, but it allows you to try and shame the customer into completing a transaction.”
How to avoid it: CR’s Shenhar says to negotiate the vehicle price separately from the financing. CR usually recommends that you get preapproved for an auto loan from a bank or credit union before you reach out to a dealership. That way the dealership can’t try to manipulate the length of the loan or the interest rate. If the dealership offers a lower rate, you can take advantage of it instead.
At the dealership, use a loan calculator on your phone—like this simple one from the Dallas Federal Reserve Bank—to figure out what the price you’ve negotiated will translate to as a monthly payment. Put in your interest rate, your loan term in months, and the total purchase price of the vehicle, and it will show you what your monthly payment should be and how much you’re paying in interest charges alone. Use it to double-check the dealership’s math, too.