Trade in Car: How to Trade in Your Car to a Dealership

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There comes a time for all of us when the current set of wheels just isn’t doing it any more. Maybe it’s worn out, maybe you’ve outgrown it. Perhaps you just want a new toy. Either way, for most of us, a new car means getting rid of the old one.

There are a couple of popular ways to do this; either advertise and sell the car yourself privately, or; trade the car in with the dealership or car yard where you’re buying the new car. Typically, there are pros and cons for both.

On the selling privately side, the biggest advantage is that you will, on balance, get more for it than if you traded it in. The cons are nearly everything else. You need to spend money on making sure the car is in good and roadworthy condition, spend more money advertising your car, you need to field the phone calls and enquiries, prepare to give up the time for prospective buyers to inspect and test drive the car and then fill out all the paperwork the seller will need to prove they’re the new owner. And you might have to be very, very patient as there’s no guarantee the new owner will show up that week. Or even month.

The alternative of trading in a car is much more appealing to many people. Yes, you will receive less for the car as a trade-in versus a private sale, but the rest of the deal is much simpler. You don’t need, for instance, to advertise the car, arrange inspections or greet complete strangers in your driveway every Saturday morning (not to mention let them drive your car). The paperwork involved in a trade-in is all part of the deal for the new car and you don’t need worry about getting a roadworthy as that is all the car dealer’s problem. And that, simply, is how to trade in your car.

Neither should you feel a need to fix the things wrong with the trade-in vehicle. In the vast majority of cases, a car dealer will have an on-site mechanic or a mechanic they use frequently who can keep labour costs down. Ditto for replacement parts as a dealer will be buying these bits and pieces on a wholesale or trade account, while you’ll be paying full retail. Put simply, the dealer will be able to fix these problems cheaper than you can. The same goes for replacing tyres or renewing registration that’s about to run out.

If you are trading-in on a new or newer car, the valuation you’ll be offered for the trade in car is not the most important number. That becomes the change-over quote, the difference between the car you have and the car you want. So don’t get hung up on the dollar value of the trade-in if the dealer is also offering you a sharp price on the new car. That said, you don’t have to accept the dealer’s first offer of a trade-in price, and remember that everything in Car Dealer Land is negotiable unless you’re buying a brand-new, say, Honda now that the Honda sales experience has moved to a fixed-price, no discounting, no-haggling model. Even so, that doesn’t mean your trade-in price can’t be something to negotiate.

Neither does it mean that you can’t go to the next suburb and try another dealer, particularly if you’re buying a brand-new car which all dealers are likely to have stock of.

Generally speaking, a used car is worth more as a trade-in (or a private sale) if it has some of its factory warranty remaining (provided it has a full service record). And a lot of sellers have found that buyers are a lot keener on a car that has travelled less than some nominal distance (such as 100,000km). But for our money, we’d always take a car in good condition with a service history over a car that might have travelled fewer kilometres but lacks the same provenance.

If there’s a best time to sell your car in this way, it’s probably around the end of the month when sales staff might be struggling to meet their monthly targets and will be keen to do a deal. Don’t forget the end of financial year, too, when dealerships jump on the EOFYS bandwagon and offer sharp deals to generate a bit of buyer interest. A dealership that is over-stocked is another good sign of when to sell your car, and dealers in this situation likely to be ready to do a deal, but in these days of limited car supply, finding an over-stocked dealer is a pretty rare thing.


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