On a regular basis, people calling into the radio show want to know whether it is best to trade their car or sell it themselves. These are unusual times with the used car market setting new highs due to the microchip shortage of new vehicles. As listeners know, I monitor auction prices weekly in an effort to bring you the most up-to-date market conditions.
Don’t Bank On Online Trade-In Values
Getting information on purchasing a new vehicle is easy these days. I know of no other business, except automobiles, where you can find out what a seller pays for his or her wares. Advantage: car buyer. However, this is not as relevant today as it once was due to the shortages.
When it comes to used car values, however, the waters get very murky. I have callers to the radio show all the time who put stock in what some of the online websites say their car is worth. There are a couple of things I always remind people of, and that is that most of these sites make their money selling ads and customer information to car dealers – and as I often say on air “KBB don’t write checks.” A car is only worth what someone is willing to pay for it. The same is true of the other sites that give online values.
Online Selling Has Gotten Easier
Computer programs have made getting an actual bid over the Internet much easier these past couple of years. Radio listeners hear me recommend this website as a place to get a true value on their vehicles in a matter of moments:
They have proven to be a good friend of my listeners and they make it super easy. Once you agree to the offer, they’ll pick the vehicle up and bring you a check.
Trade-In Evaluation Considerations
So, as a consumer, what do you do with your trade-in? Luckily, these past five years or so, new car dealers have had to be very aggressive with used car trade evaluations. If you have a nice, clean, average mileage trade-in, dealers actually really want your trade-in, and will step up and pay top-dollar for it, knowing it will sell fast and make a buck. I have seen dealers lose money on a new vehicle just to get the trade-in. Those cases are easy, and if your car fits the above criteria, you won’t have any trouble making a trade. In some states, like Texas, there is a sales tax advantage to trading in your car.
However, what if your car is old or has a lot of miles? Then the decision comes down to how willing you are to maximize the value. If a dealer is not going to re-sell your car, it is hoping to own it for what it can get out of it to a used car dealer, or at auction. They don’t really care about making money on it, but with low margins on new cars in most cases, it certainly don’t want to take a loss on your old family truckster.
Then the decision comes. Trade it or not trade it? I urge listeners to try to stay objective. Often, cars you have had a long time hold sentimental value to you, but not to anyone else. It is cute your child lost his or her first tooth in the back seat, but that doesn’t really help the value. Keep everything in perspective and try to see your car from the eyes of a stranger.
Selling It Outright Yourself
If you don’t trade it in and be done with it – which is the easy way – then you can withhold it and try to sell it yourself. Good, older cars are always in demand for those who are looking for their kid’s first car, or people who have cash, but cannot finance.
There are also some advantages to donating your car to charity, or perhaps you have a friend or relative in need who could use a good set of wheels that still has some life left in it.
For most people, trading your car in at a dealership is the easiest and safest method of upgrading your transportation. No matter how old or new your current car is, a dealer has a vested interest in being fair on your trade value, after all, the sale of a new vehicle is at stake.
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