Tips For Trading In Your Car

Owning a car is a major expense, so if you are trying to budget your money then you should seriously consider holding onto your car for as long as possible and using it in the most economical way.

However eventually there will come a time when you need to trade your car in, because if you are constantly spending money on repairs then keeping that car make no financial sense in the long run.

So if you decide to trade in your old car for a new one, what should you do? Here are some suggestions.

Clean Your Car

If you are trading your old car in you want to make sure it looks as good as possible, as the way you car looks will affect the amount of money you will get for it.

Give the car a thorough wash, and make sure it is clean inside and out.

Use a vacuum cleaner to remove dirt from the seats and carpet, and clean the insides of the windows to remove any finger marks.

If there are any small mechanical faults with your car, try and get those fixed too.

Generally speaking, used car dealerships will pay a lot more attention to how clean your car is than private buyers, which they may then use to determine how much they are willing to part exchange your car for.

If you are a smoker, then expect to receive less for your car (if you smoke inside it) from used car dealerships. However if you are selling privately to another smoker, this will be less of an issue.

Unfortunately smoke can be very difficult to remove from car fabrics, although you may be able to temporarily disguise this somewhat with an air freshener.

Seal The Deal First

If you want to trade in your car at a car dealership, don’t tell them you are planning to trade in your car right away.

First find a car that you want to buy, and then let the dealer make you an offer.

After you have bargained down the price, tell them that you want to trade in your old car.

This way the car dealer can’t factor in the trade with the price of the new car, meaning you will get a better deal overall.

Find Out How Much The Car Is Really Worth

Before you make an offer on a car you like, it is worth finding out how much the car dealership paid for that car. This can usually be done by contacting the “consumer reports auto price service” or googling that term.

Although you will have to pay a small fee, you should be able to find out how much the dealer paid for that car plus each option.

One you have this information decide which options you want, add them to the basic cost of the car, and then use the number you come up with as your first offer to the dealer.

Negotiate

Once you know how much a dealership paid for the car you are interested in, your aim should be to get it for as close to that price as possible.

However in most cases the dealership will be unwilling to sell it to you for the price they paid, and so will make you a counteroffer.

Your job is to make a counteroffer in response to their offer, which should be about 2% higher than your original offer.

In general, you should never pay more than 5% of what the dealer paid for that car.

Know Your Cars Worth

Before trading in your car always know what it is worth by looking up your cars value, such as with the national automobile dealers association guide.

Once you know what you car is worth, you can then subtract that cost from your new car.

Carrying out this step will also protect you from dealers who tell you your car is worth less than it actually is.

It is also worth pointing out that how much you old car is worth has nothing to do with how much the new car you want to buy is worth. Some dealers may try to give you less for your old car by using this trick.

Financing

If you walk into the dealers with pre-approved financing from your bank or credit union, this will prevent the salesperson from using financing as a bargaining tool.

Selling Your Car Privately

Generally speaking, you are likely to get more money for your car if you sell it privately rather than if you were to trade it in at a car dealership.

Once you decide how much your car is worth, advertise your car at a slightly higher price than its actual value.

A good place to advertise is with classified ads, as these will allow you to advertise your car for free or at a minimal fee.

The disadvantage of using classified ads is that you are limited to buyers in your local area, which may result in a long delay before your car is sold or your car not being sold at all.

To expand the reach of your advert try online marketplaces such as eBay, but be aware that these will charge a fee for using their services.

Since most people will naturally try to negotiate the price down, by advertising your car at a higher value any negotiation that occurs should still result in you getting a good deal for your car.

All the steps that have been listed for trading your car in at a car dealership applies to selling it privately. So make sure your car is in good condition, and looks presentable.

Car Agreement

Once the deal has been made the buyer should sign an agreement which includes the price of the car, the name of the buyer and seller and the date of the sale.

Your agreement should also include the words “sold as seen” or “as is”, to protect you from any claims the buyer might make against you later on should they have problems with that car.

Payment should be made in cash, as unless you know the person very well it is not a good idea to accept a cheque.

Overall if you can arrange for a private sale you are probably better off doing so rather than going through a car dealership, as in most cases you will get a higher return on your car.

However if you are in a rush to sell your car, then part exchanging it at a car dealership may be the best option for you.

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