What are the pros and cons of trading in your car?

Here we will discuss the benefits of trading in a car for another car and the car’s trade in value. You want to trade in your car, and you want to know how to go about it. But first you need to know all the particularities about it, all the legal procedures and the easiest way to do it with you getting the best deal. So let’s deal with this matter.

Vehicle owners like trading their vehicles to get another one, why? Because it’s easy. A vehicle owner just has to drive to a dealer they want to deal with, sign all the appropriate documents needed. And then leave in another vehicle that they had wanted. That’s called trading. Now if their vehicle’s value was more, then traders apply trade in credits to reduce the payment for a new vehicle they taking. However, if the car’s trade in value is lower then you have to pay extra.

There is a difference in the 5% general sales tax customers will have to pay. That is, if the vehicle you are buying is more in value, most of the states will want you to pay a sales tax on only the difference between the price of the vehicle getting traded-in and the vehicle being bought, not the full GST that’s required for buying a brand new car.

Now the Department of Motor Vehicles in your state will tell you everything about the sales tax concerning the trade-in and new vehicle you are wanting to acquire.

But now dealing with the dealer. You will be losing dollars, from hundreds to thousands of dollars to the car dealer. The dealers will do their best to undervalue your vehicle if you have not thoroughly done your homework in knowing your car’s trade in value. When you do know the value of your vehicle then a lot of haggling might still be done by the dealer or the sales person to get the best deal, that is, exchanging your vehicle for the vehicle you want. It might be better to first sell your car and get an amount that will easily cover financing a new vehicle plus paying off the 5% GST.

The dealer might already have three or four cars of the same model you are trying to trade with or maybe the dealer does not want your particular model. No dealer will do you a favor and give you top dollar for a trade-in deal. If it is successfully traded-off, it’s because it was in fact high in value and the dealer has calculated it will be either sold off or successfully traded-off again. In any case the dealer does not stand to lose anything.

Get out the most value for your trade-in car

Do this to maximize the value of your car. Treat this process as a sale.

Make sure the outer appearance of your car is in the best condition it can be in. Dealers and used-car managers know that people are very visually attracted, so the estimates of your car will depend first on its appearance.

Take the estimates of the cost of repairs. That is if your car needs repairs. This will be appreciated by the dealer and can determine your car’s trade in value, in a more positive light, since you have paid for it to be checked, and estimations for repairs have been made, besides you being honest. Also your mechanic will probably give you the right estimation. The dealer’s mechanic might give a higher estimation, reducing the value of the car since the repairs would seem higher to deal with.

Do try to sell the car to a used-car dealer first. Following the advice at the beginning, making sure your car is in its best condition. Used-car dealers are usually looking for clean, well maintained, low-mileage vehicles for their collections. If you have a popular model, you might have a chance of getting a better bargain than selling it at the wholesale price its worth.

Guidelines for doing the trade-in negotiations

Get the best deal for your car by keeping the purchasing phase and the trade-in phase negotiations apart, do not mix them, or do not do them simultaneously. If the dealer mixes up the dealings, then figures can be manipulated and this could end up giving you a good price for the car but at the same time reduce its value in price compared to the car you want. And this means you would have to pay the difference and don’t forget the 5% GST that could be applicable in your jurisdiction.

Deal with the purchasing part first. This will tire the dealer and want him to seal the deal faster when it comes to negotiation the trade-off part. Otherwise you will be in trouble because dealers make good money dealing with trade-ins, they always under value a trade-in in some way or the other.

Keep your full attention on the end part of the dealing. Now you are going to pay the net amount and make signatures. Yes, it’s the net amount you are expected to pay that is all important. Read and understand the trade-in or sales contract before signing it. if there is anything wrong with any term or condition, ask the dealer about it, sign nothing. After signing and sealing the contract there is little you can do to make any changes.

We clarify the dos and don’ts for a trade-in undertaking

1: Determine the trade-in value of the car

Be frank about the car to yourself. A few trade-in cars can be considered in outstanding condition with little mileage on them. Many trade-in cars are considered clean by dealers if they have been maintained well. So get a few mechanics and dealer to estimate the trade-in value of your vehicle before you go off trying to trade it in for another vehicle. Definitely, you will have a better bargaining edge at the tables.

 2: The appraisal process

This step really deals with getting an offer. That means a dealer has estimated the value and has given you an offer for the car. Don’t just jump for it. You have just got an appraisal value which is a reference point for you by just one dealer. Check out other dealers and see what appraisals they give you.

Make sure to set up an appointment with the used-car manager for an appraisal on the car. Do this in the week when the dealer will most likely have more time to evaluate the value of your vehicle and there will not be other trade-in car owners with better prospects to compete with you. There might be no waiting or hectic, careless rush through in appraising your car. There is even the blind trade option. In this type of dealing you communicate with the dealer through phone and email. The vehicle identification number, photos of exterior, interior and odometer readings are all sent by email. The dealer then assesses the vehicle and proposes an offer. Trade-in always depend on the car’s condition, the dealer’s inventory and the demand for a specific model. There are special promotions around trade-ins too.

You have to outsmart the system. This is what you can do to give yourself a better chance. Go to a dealer that deals with another type of model other than your model. Now your car will not get rejected so quickly since the dealer’s inventory might not have your model type. Dealers usually like to keep a variety of models for trade-ins. Customers like to have a choice. Your car will be appraised more distinctively. It’s that easy and you use this same strategy with other dealers to get more appraisal offers to choose from to seal a deal. You will give yourself a wider option.

 3: Negotiate or Close the Deal

Now you have a number of appraisals from which you can select the best offer and decide to take it up or further negotiate for a better price. If all paperwork is in order, every legal formality can be done in 30 to 40 minutes. Deal with the best offer from where you can get the car you want. You will be giving the dealer business on both ends, and this might give you a better chance to lower the price of the car you want. Do make it clear you want to buy a car from the dealer at the very start. Then stick to the selling in your car. Mention the offers you have received for your car. All this will improve your chances for a good appraisal and trade-in deal for the car you want.

Our last words

Do think about the price you can get so all this research will be worth your time. Everyone has to do this digging. And it’s so easy through the net. So check other articles and then proceed towards your targets.