How to get the best trade-in value for your car

How does trading in a car work?

Most consumers trade in their used car to afford a new one. If you trade in your existing vehicle at the dealership, you can use the trade-in money as a down payment on a new car. If you’re not buying a car, most car dealerships will still purchase your used car, especially if inventory is low. However, you’ll get a better offer if you trade in your car for a new one than you would if you sold it for cash.

Turn data into insights with Excel

Make better decisions backed by data and insights

Learn more

You can trade in your car in a few simple steps:

• Research your car’s worth
• Prepare your car for trading it in
• Negotiate with your dealership
• Close the deal

How to boost your car’s trade-in value

As you prepare to trade in your car, take the following steps to ensure you get the best value for your old ride.

Research your car’s current market value

Learn the value of your trade-in before you visit the dealership, so you’re prepared to negotiate a fair price with the salesperson. There are numerous online resources you can use to evaluate your car’s worth. However, your car’s actual value may be lower than its average market value if it needs significant repairs. Learn the cost of the repairs and subtract them from your car’s value so you’re prepared for the negotiation process. You can also repair your car before you visit the dealership if the value of your trade-in outweighs the cost of repairs.

Make sure your vehicle is in good condition

Ensure that your car is in good running condition – otherwise, it might be rejected from the dealer. Making the necessary repairs before trading it in will raise your car’s value. It’s especially important to make any minor repairs that won’t put a large hole in your pocket. This includes fixing things like dents, scratches, broken lights, and cleaning your car’s dirty exterior. In addition, check to see if any of your car’s parts have been recalled. You can get recalled parts fixed for free, which will boost your car’s trade-in value at no additional cost.

Negotiate the best offer

If you’re purchasing a new car, experts recommend negotiating your new car’s price and your trade-in separately. Secure your trade-in before bringing up buying and get the offer on paper so your dealer can’t revoke or change it. Most car salespeople will negotiate everything as a bundle, so if you’re getting an unbelievable trade-in deal, you may be paying for it elsewhere with a higher interest level or price on your new car.

To get a better idea about the trade-in value of your car, get multiple quotes from different dealerships, used car sellers, and online sites. If you find a competitive quote, you can bring it to the dealership to negotiate a better offer.

Time your trade-in well

If you can, wait until the end of the month, fiscal quarter, or year to trade in your car, as that’s when your vehicle will fetch the highest price due to increased demand.

Remember that you can say “no”

If you’re not getting a fair offer, you can always keep your existing vehicle and try to sell it elsewhere. Your dealership is trying to profit from the trade-in, so they can’t pay the full value of your car. Therefore, some car owners choose to sell to private parties since they’re usually willing to pay closer to the car’s true value. The only downside is the loss of convenience you would get from trading your car in at the dealership.

Once you close the deal, don’t forget to discuss the terms of the sale and when you can expect a payment from the buyer or dealer. If you find a good deal, you may want to act quickly as the market is always changing. Want to buy a car but aren’t sure how to go about it? Check out this article to learn the pros and cons of leasing vs. buying.