How To Get A Better Deal
Understanding your current car’s value.
A sometimes-overlooked aspect of buying a new car is selling your old one. Of course, you want to get the best possible deal and the most cash. But for convenience, you may simply choose to use it as a trade-in at the dealer when buying your new car.
If that’s the case, be sure to determine your current vehicle’s value ahead of time. Understanding your car’s resale value before car shopping enables you to get the best value for your trade-in. Also, consider keeping your trade-in a separate transaction from the purchase to get the most money. If you feel the dealer is not offering what you want in or is not offering an equitable trade-in figure, shop elsewhere.
Consumer Reports notes that a trade-in is a “an easy way to dispose of your current car…but You will get less money than selling it yourself. At best, you should expect to get the vehicle’s wholesale value. To get the best price, you will probably have to haggle with an experienced salesperson over the trade-in value.”
That’s not the easiest thing to do.
Selling the vehicle on your own – it’s often a better deal.
When you use online sources like Craigslist and Facebook Marketplace, you can usually get a better selling price and put more cash in your pocket. However, Consumers Reports states that selling it yourself “requires considerable effort, including placing ads, taking phone calls, dealing with strangers, and giving test drives. You’ll usually get the most money for your car, somewhere between the vehicle’s retail and wholesale values.”
A drawback to selling it yourself is potentially not having the funds for your new vehicle’s down payment. It will depend on your sale’s timing and if you need a new car before you sell the old. You will still need to negotiate a deal with a buyer, but it should be easier than dealing with a car salesperson.
Source: Consumers Reports.
If you’re using sites like Craigslist or Facebook, there are tips to keep in mind. Forbes.com offers insight into making a successful (and safe) sale:
- Do an extreme cleaning. This will make your vehicle more appealing.
- Take pictures on a sunny day. A clean car featured in a beautiful backdrop will encourage a faster sale.
- Set up a secondary email, like ford2003, to get messages. It will help keep your data private.
- Use the safe spot where you will meet buyers as your Craigslist or Facebook location.
- Price your car low—say, at a 20% discount to the Kelley Blue Book price. The Kelley prices may be somewhat above market, and you want your ad to attract responses.
- Be relaxed about the test drive. Perhaps take a picture of the potential buyer’s driver’s license.
- Bring papers to the test drive: a print-out from Kelley showing your buyer that he’s getting a bargain; a photocopy of your title; two copies of a contract of sale reciting the price, your name, and the prospective buyer’s name.
- Arrange a quick closing. If you have a deal, explain that you want the balance in the form of a cashier’s check.
- Call the bank to ensure the check’s legitimacy.
- Prepare for the sale with the DMV.
- Remove the plates immediately following the sale.
If there is anything we can do to help sell your old car (or buy new), reach out! Our loan experts can help answer any questions you may have.