Perhaps you have been looking at some of the newer cars on the market and have decided to upgrade your ride. Maybe your car is nearing the end of its life and you want to trade it in for a newer model, while there is still some value associated with it.
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How can you be sure to get the highest possible value out of your current vehicle, whatever your reason for trading it in?
Research the Value – Websites like Kelley Blue Book and Edmunds allow you to look up the value of your current vehicle. Input factors such as your car’s make, model, mileage, and estimated condition to get a ballpark value of what your car would sell for in your area.
You may have the option to select value for trade-in or sale to a private party. Trade-in values deduct the dealer’s costs to store, showcase, advertise, and sell your car. Run the report both ways to get an idea of the estimated costs of dealers in your area. This gives you some idea of the latitude the dealer has to work with.
Dents and other signs of wear may drop the value, and the effect may be greater with brands or models that tend to hold less value in the first place. If you are not sure how to compensate for condition or do not have time to do research, you can have your car separately appraised.
Detail Your Car – Your car must be as clean and presentable as possible. Consider having it professionally detailed. Minor scratch or dent repairs and even a complete repainting may pay off, especially if your car is an unusual (or unattractive) color. Are you a DIY person (or a cheapskate)? Make sure you are thorough if you take on your own cleaning. It is not enough just to remove the three-year-old French fries from under the seats and spray air freshener on the upholstery. Use a quality-approved cleaner for each surface, vacuum thoroughly, wash the windows inside and out, and deal with the sources of any smells. (An objective opinion may help regarding smells. Do not take it personally.) Look under the hood as well. Obvious oil sprays, cracking hoses, and corroded battery connections will leave a poor impression of your maintenance habits.
Gather Records – Thorough maintenance records can provide proof of proper care and increase the trade-in value of your car. You will also need records to document repairs for any past accidents that will show up on CARFAX or upon a mechanic’s inspection.
Do Not Offer First – Dealers are generally looking for a minimum margin of a few percent. If you suggest an amount before they inspect the car, you have given them latitude to increase that margin knowing you will accept it. Let the dealer offer first and see how that matches up with your research.
Shop Around – Your car may be more valuable to some dealers than others. Do not simply accept the first value that you are given, even if it fits within your expected range.
Separate Trade-In from Purchase – Beware of dealer manipulation when you are trading in for credit against the purchase of a different car. A dealer may pad the apparent trade-in value of your car only to recoup an even greater amount in other fees related to the purchase.
Separating these two transactions helps, since you are more likely to spot a charge that seems unusually high. You still have to go through the individual fees to see what is reasonable, and comparing the offers from different dealers gives you a greater chance of spotting an inflated fee.
Whether you are looking for a new Hummer, a Honda, or a Hyundai, by following these steps, you are likely to get the best deal for your current vehicle – and therefore pay less for your new one.
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