How Do I Know If A Dealer Trade-In Value Is Fair?

How Do I Know If A Dealer Trade-In Value Is Fair?

When it comes to getting rid of your old car (while buying a new one), the most preferred option is to trade it in. Many people choose the trade-in option because it is convenient and selling their car to a private party is not always easy. However, one of the complaints people have is they feel the car dealer’s trade-in value is not fair. Here we have shared some tips on how to find the trade-in price range of your car.

How Is A Trade-In Value Calculated?

There is no standard method to calculate trade-in values nor there are any specific laws governing this type of trade. In most cases, car dealers offer a wholesale price which might not be the fair trade-in value of the car. Car dealers take several factors into consideration while determining the trade-in value of the car. Some of the important factors are the make, model and variant of the car, engine type, service record, condition of the car, condition of the tires and the popularity of the model. If you want a fair trade-in value for your car, you first need to find out the trade-in price range of your car. Here are some tips to find out the trade-in price range of your car.

Use Car Value Sites or Pricing Guides

There are several car value sites with appraisal tools that will help you find a fair trade-in price range for your car. To get the trade-in price range, you need to provide information like the make, model and year of your car, as well as the mileage and several other things. You can also go to car dealerships to know about the sale price of cars similar to yours. The prices mentioned on car dealerships websites are retail prices and not trade-in values. Generally, car dealers expect to make a profit of around $1,200 in the sale of used cars. You can deduct $1,200 from the retail price to find a general price range for trading in your car. However, the condition of the car needs to be also considered. If your car is in bad condition, the car dealer might reduce the trade-in value significantly.

Spend Time to Know the Condition of Your Car

A visual inspection is not enough to get a real idea about the condition of the car. Hire a mechanic to conduct a mechanical inspection of your car and report any problems to you. If there are any major mechanical problems, get them fixed. You need to be realistic about the condition of the car. According to experts, a car in what’s considered “good” condition will get a higher trade-in value. Here is what a car in good condition looks like:

  • Shiny, recently waxed paint

  • No major scratches or dents

  • No stains on seats and carpets

  • Engine runs smoothly

  • Up-to-date service record

  • Tires are in good condition (good tread life remaining)

If your car is in good condition and the car dealer is offers a very low trade-in value, you can ask the sales consultant how he/she came to such a low figure. When you are armed with the right information, you can negotiate with the car dealer to offer you a fair trade-in value.