If you already own a car and are looking at buying a new one, you will most likely want to know how to determine a car’s trade-in value. You could take the offer a dealership or private seller gives you, but you will have more negotiating power if you do your research first. It’s important to know what your old car is worth, so you can make sure you get a fair price on the new one.
Consider car value calculators
Step 1: Use a value calculator. Determining the trade-in value of your car is as easy as going to a website designed to help you figure it out.
Popular and reputable sites include Kelley Blue Book and Edmunds. Both of them have car value calculators where you simply enter the information and hit submit.
Gather the car information
Step 1: Know the details about your car. You will be asked to provide specific information about your car. You will need to supply the make, model, year, mileage, trim, overall condition, and a list of add-ons.
If you do not know which condition your car qualifies under, there is a questionnaire that can help you. Conditions rank as low as poor, which is a car with significant damage and past repairs, and as high as excellent, which is a car in pristine condition.
It is important to answer the questions honestly, because it will not benefit you later on if you don’t. When you go to trade in your car, the dealer or individual will inspect the car and its records.
Make sure to choose the trade-in value option
Step 1: Choose the trade-in value. After you provide all the information and hit submit, you will be give three value options. They include retail value, trade-in value, and private party value.
Make sure you choose trade-in value or you will not get the right estimate for your transaction.
You may notice a significant difference between the values, but there are several other factors considered in each pricing structure. For example, the retail value will often be higher because it takes into consideration that a dealer has additional costs associated with reselling the car, such as advertising or storage fees.
Don’t be fooled by the classifieds
You may notice a similar car as yours being advertised in your local classifieds at a higher price. First of all, just because someone is asking that price does not mean they will get it. Secondly, people often paint a different picture on print that what appears in person. Lastly, there isn’t any way to 100% accurately compare your car to the one being advertised. You cannot possibly know the true history of the other car without owning it yourself.
Step 1: Negotiate the price of the new car. Once you have figured out what you consider a fair trade-in value for your old car, it is time to negotiate for your new one.
If you bring the information you obtained from the car value calculator, you will have backup to your claims. Remember to be realistic, but make sure you are being treated fairly.