Every so often, it’s time to trade in your car for something newer and more reliable. But where do you begin? There are plenty of factors to consider when trading in your car, including price, the number of miles on the car, and whether you still owe money on it or not. Use these five steps to guide you through the process of trading in your car, from start to finish!
It is important to do your research and understand the trade-in process in order to maximize the amount you receive for your trade-in.
You should first determine how much your vehicle is worth so that you will feel empowered to negotiate and increase your chances of getting a fair price.
You can find out the value of your car by using free online appraisal tools such as Houston Direct Auto, rather than waiting for a dealer’s opinion. Make sure you use an estimator tool that takes into consideration features of your car beyond its make, model, year, and mileage in order to get a better sense of what your car will sell for.
In addition to internal factors, external factors affect the value as well. If gas prices are high, a car with better gas mileage might be more in demand than an oversized truck.
In the process of trading in a car, you not only need to assess the state of the vehicle, but you will also have to assess your current finances so that you will be able to afford to replace the traded in car with a different car.
When trading in a car with a loan, you need to make sure that the car’s trade-in value will be enough to repay the remainder of the loan. You can compare this by talking to your lender to see how much the remaining loan will be. Shop around to ask the different dealers for trade-in quotes and determine how much each will offer for your car.
Keep in mind that if a dealer offers to pay your loan off for you, they will want to sign you up for a new car loan, at the payoff balance as an opening balance.
Trade-in doesn’t always need to start with you going to a dealer; instead you can have them come to you and give you their price. Online estimators, such as Houston Direct Auto linked to dealers that can estimate your value, can be helpful if you know the necessary details about your car.
Purchasing your vehicle where you start may be beneficial in the long run.
If a car owner is able to go back to the same dealership where he or she purchased the car, they may be able to negotiate a better deal since they have a history there, according to Meghan Davlin of the Illinois Fuel and Retail Association.
4. Refresh your car
When it comes to trade-in values, a cleaner car is more likely to sell. Take the time to clean the interior and exterior of your car so you can show it in the best condition possible.
true Car’s senior vice president of business development, Alain Nana-Sinkam, says to make sure your car is clean and presented in the same way you would want to receive it if you were buying it. as well, if there were minor issues you had planned to correct before the trade, make sure they are addressed so the car arrives at the dealer as you expected.
Keeping your vehicle in good condition will increase its value. Don’t fix the vehicle for more than you expect to sell it for.
If you have any service records, be sure to keep them.
Check your vehicle’s recall alerts at this time, as any defective components could lead to a safety hazard. A recall usually involves the repair or replacement of a vehicle part at no cost to the customer.
It’s best to make an appointment in advance if you’re going to a car dealership because it can be a busy place. It is important that all the information you provided online is correct before the dealer evaluates your car.
ask to be present with the appraiser so you can ask them questions about how they determine your vehicle’s value, says Joe McCloskey, president of McCloskey Motors in Colorado Springs. This information is generally shared with you by dealerships, and having it can help you better understand how and why the dealer values your vehicle.
Ensure you have the title, registration, and all keys with you. If you don’t have the title because you’re trading in a car with a loan, be prepared to give the lender’s details.
In any case, you’re under no obligation to accept the car dealer’s initial trade-in quote; negotiate your car’s trade-in value instead. Dealers typically start with the lowest possible price. Tell the dealer the price you found seems too low in light of offers you found or your research.
Negotiate the trade-in value of your car separately from the price of your next vehicle to ensure you are getting the best trade-in value.
When should you trade in your car?
Trading in your car is all about deciding if it is a good idea to do so based on its equity. Equity is the difference between what you owe and what it is worth today.
Negative equity, or owing more on the loan than the car is worth, should be avoided when trading in your vehicle. Trading in your car will still leave you with a balance on your loan, which is challenging.
It is best to wait until you are no longer underwater on your car before you trade it in. If you must trade it in, you may wish to consider buying a less expensive vehicle to reduce your losses.
Having positive equity, on the other hand, allows you to use the additional value from your vehicle toward the purchase cost of the new one.