How to Get the Best Value when Trading in an Old Car Upon a New Car Purchase
Here is a simple guide for trading in an old car and several tips on how to make the most from such a transaction.
What should you do with the car you are currently driving when purchasing a new one? If that vehicle is well maintained and is in tip-top condition, why not sell it or trade it in? In both cases, you could generate a significant amount of cash, which could possibly cover your down payment (partial or full) or your first few amortizations on your new car.
If you want to make the most from your old car, it is better to sell it yourself. But doing so could be tedious and could take so much of your time as to not be worth it at all. In that case, it would be advisable to trade-in, an option that would save you not just time but also a lot of effort.
Thus, it is not surprising that up to 40 percent of car buyers in 2018 expected to trade in their old vehicles, based on transaction data by Edmunds.
“Up to 40 percent of car buyers in 2018 are expected to trade in their old vehicles.”
If you are new to such a transaction, here is a simple, three-step guide for trading in an old car in time for a new vehicle purchase:
1. Get an appraisal for the old car’s trade-in value.
It pays to know how much your car is worth. If you are trading in your old car with the dealership, it would be advisable to have it appraised by a third party first, so you would not have any hesitation when the dealer gives you a trade-in price. Be honest when providing information during the appraisal process. It’s unwise to lie about the car’s condition because it will be appraised by seasoned car experts as you move forward in the process.
2. Get quotes from two or more dealers.
Obtain trade-in quotes from not just one but a couple or more dealerships. Getting several trade-in quotes can help you better understand the actual value of your old car. Of course, you can also easily determine the best offer for your old vehicle.
“Getting several trade-in quotes can help you better understand the actual value of your old car.”
3. Get into negotiations and close the deal.
Consolidate your appraisals and offers, pick the best deal, get to the negotiation table with the chosen dealer and close the deal. If you are having a hard time choosing between two dealerships with almost the same offers, pick the one where you intend to purchase your new car—a strategy that will give you greater leverage. It is best to come prepared beforehand. When the necessary paperwork is in order, the trade-in deal could be done in as fast as 30 minutes.
Here are more tips that can help you make the most of your trade-in:
- Observe strategic timing when trading in your old vehicle. It is better to dispose of your car prior to the renewal of its annual registration, so you won’t have to shoulder the cost of doing so.
- Don’t think that investing in car repairs would help raise the appraisal of your old car. Dealerships are experts in fixing vehicles. That is why they can easily tell if your car has undergone a minor or major repair upon appraisal. Whether dents are fixed or tires are replaced, your car would still get the same valuation without such repairs. It is better to instead spare your wallet from those costs and let the dealer handle them with their increased resources.
- Insurance claims impact your old car’s trade-in value negatively. Accident repairs paid by your auto insurer would reflect on the car’s history report, whether that repair is a major or even minor one. There is nothing you can do about it.
“Accident repairs paid by your auto insurer would reflect on the car’s history report, whether that repair is a major or even minor one.”
After trading in your old car and buying a new one, you should already start thinking about the possible trade-in value of your newly purchased vehicle after a few years, or when you need to buy a new car. By this time, you should know better about how to keep the valuation of your car high upon trade-in.