6 techniques to increase your car’s trade-in value

The vehicle industry has been challenging to manage over the last several years amid inventory shortages and soaring costs. But in September, for the first period in five months, the median price of new automobiles declined somewhat. Used vehicle prices steadied, too, according to Kelley Blue Book.

If the market changes have inspired you to trade in your automobile for a new pair of wheels, don’t race to the dealer and miss a fantastic offer. First, take actions to increase your car’s trade-in value. These include analysing your automobile’s current worth, addressing technical concerns and making sure your car looks its best.

Do your homework

Knowing the worth of your automobile is vital, especially if you want to trade it in. Conduct research to ascertain your vehicle’s current trade-in value. You may use sites like Kelley Blue Book and Edmunds to determine its current market value, however you should also be honest with yourself regarding repairs and your vehicle’s condition.

Also, bear in mind that you’ll earn less for your trade-in than you’d make if you sold your automobile on your own.

“Many people think they have the opportunity to get the top value, however dealers taking in the trade require a margin of profit and are going to give you less than the trade-in price stated on these sites,” explains car expert Lauren Fix.

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Take care of recognised mechanical concerns

The mechanical and physical condition of your automobile are significant determinants of value. So, it’s preferable to handle any concerns that are very straightforward to remedy.

In general, small repairs that don’t cost anything out of pocket and have the potential to boost the resale value of your car are worth considering. This could involve simple aesthetic improvements like as dents and scrapes or replacing lights that are out.

Research repairs that boost the resale value of your automobile and the expenditure connected with each repair to determine which repairs will be the most cost-effective.

You can also check the National Road Traffic Safety Administration database for potential vehicle recalls impacting your automobile. Recalled components may be repaired free of charge, and the additional work may boost your car’s worth.

Keep receipts for maintenance and repairs, and check your files for outdated ones. These might verify to the dealer or purchaser that you taken care of the vehicle. Consider getting a car history report for the car for the dealer to analyse when considering your trade-in.

Make sure that your automobile looks its best

Fix points out that a clean and well-maintained automobile is more likely to obtain the best trade-in value.

“Clean the vehicle within and out,” she advises. “Detailing the car is comparable to staging a home for resale.”

Shop around potential trade-in value

Zach Shefska, the co-founder and chief executive officer of Your Auto Advocate, thinks it’s crucial to “shop around” your automobile for trade-in potential.

“Get as many competitive quotes for your exchange as possible before engaging with the dealer,” he recommends.

For example, you should collect quotations from Carvana, CarMax and any other big used vehicle dealers in your region before discussing your trade-in with the dealer you want to purchase from. You may use these data, together with other research you perform on pricing, to determine your car’s basic worth.

Negotiate trade-in price separately

By negotiating the sale of your vehicle and purchase separately, you can guarantee you obtain the greatest trade-in value possible and the best cost on the new car you’re purchasing.

Shefska warns that shoppers look out for dealerships who attempt to merge the two purchases into one deal. They do this because there are more chances for a dealer to gain money while working on two deals at once.

It’s also a good idea to have the trade-in offer in writing. This protects you against the dealer altering or going back on its offer for whatever reason. A formal offer is particularly vital if you leave the dealership to look around more and return to the same dealer later.

Time your trade-in

Trading in your automobile to get another vehicle may work better certain times of the year than others, depending on the time of year, make and model of your vehicle. Weather conditions in addition to circumstances might potentially play an influence in the offer you get.

Financial adviser Matthew Kircher of Fairpoint Financial Management says he just timed his trade-in value depending on demand.

He got a new 2021 Toyota 4Runner and sold in his previous Ford Escape in January 2021. He was clever about scheduling since he understood that all-wheel-drive SUVs would be in great demand throughout winter and shortly before the spring college term.

“We waited until the perfect time to trade in our old vehicle to boost its value,” Kircher explains. “We also timed it perfectly, having the best offers for new vehicles occuring at the same time.”

The first two quarters of the year might also be a good time to trade in a car since buyer demand tends to be stronger. Dealers need more automobiles available on their lots to match the demand and may give a greater price for your trade-in.

Trading in a vehicle when you owe money on it

Trading in may not be the correct decision if you’re still paying off your automobile, especially if you owe more than your car is worth. You may wish to postpone your next automobile purchase or sell the car on your own to earn a greater price. But if you trade it in, the equity that is negative doesn’t simply evaporate and is likely to transfer into the future auto loan.

The Federal Trade Commission (FTC) recommends against selecting a dealership that offers to “pay off your loan no matter the amount you owe.” While a dealership could pay off your previous loan, it must make up the difference someplace – and that “somewhere” will ultimately come up with you.

“Dealers may include negative equity in consumers’ new car loan,” states the FTC. “That would increase the amount they pay each month by adding principal and interest.”

The bottom line

Ensuring you obtain the greatest trade-in value will help you get a cheaper price and payments on the new or used car you desire. It’s certainly worth it to conduct your homework, perform much-needed repairs, freshen up your car and obtain numerous quotations.

When it’s time to purchase, utilise the same research skills to compare vehicle loans. A dealership you’re dealing with could provide in-house financing, but that doesn’t imply it’s the best bargain. You may be able to obtain preapproved for a car loan online with better conditions and use the loan offer as leverage in negotiating a bargain on your next automobile purchase.

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