I went to a dealership and found a new "demo" car for sale at a $4,000 discount. Is buying a demo car a good idea?

Dealerships are always trying to unload "demonstrator" cars (or "demo cars") -- that were driven by the managers or salesmen but are still legally new. The car salesman may tell you that the demonstrator has been immaculately maintained since it was driven by an "executive." He may also assure you that you can get a far better deal on this demo car than you would get on a brand new car. Don't believe it.

While a discount of $4,000 may seem generous at first glance, my experience tells me that the selling price of a demonstrator car is often not much less than if you bought the same car brand new. And if you take into account the fact that there is considerable mileage on this "new" car (which, for some manufacturers, gets subtracted from the mileage allotment of your Factory Warranty) and the fact that demo cars often receive lots of abusive wear and tear that may not be noticeable at first glance, the demo suddenly doesn't seem so attractive.

Best Advice: avoid any offers to buy a demo car.

What is the difference between a demonstrator car and a used car? Aren't they both considered used?

A demonstrator car (or demo car) is a new car that has been driven by the dealership's salesmen, managers or executives but has never been registered with the state.

A used car is any car that has been registered.

Rule Of Thumb: Once a vehicle has been registered, it is legally considered "used". If the vehicle has never been registered (regardless of how many miles are on it), the vehicle is legally considered "new." Demo cars, therefore, are still considered "new."

Read More About Car Buying:

- Car Buyer Secrets
- Car Buyer School
- Car Buyer FAQs

Michael Royce is a consumer advocate and former car salesman. For more car-buying tips and advice, visit his Beat The Car Salesman website.