Car Trade-Ins: What You Need to Know Before You Buy

Trading in your existing car when buying a new one can help offset the purchase price. But to get the best value, there are some important things to consider beforehand. Follow these tips to maximize your trade-in and make the process smooth.

How Dealer Trade-In Works

The basic process involves:

• The dealer assesses your old car and makes an offer based on condition, mileage and market value.
• This trade-in value reduces the price you pay for the new car.
• You hand over the keys and ownership of your old car to the dealer.
• The dealer takes care of the sale and transfer paperwork.

Trade-in values are generally below private sale prices. But it saves the hassle of advertising and showing the car to buyers. Dealers may also offer incentives or higher trade-in values to help finalize a new car sale.

How to Trade In a Car

Follow these steps for a streamlined trade-in experience:

• Research the current market value of your car using online tools. This gives you a target trade-in range.
• Address any mechanical issues or significant cosmetic flaws. This’ll maximize your valuation.
• Obtain quotes from multiple dealers to compare offers. Consider visiting dealers you’re not buying from to just assess trade-in value.
• Be prepared to negotiate to get the best price. Refer to market prices to support your valuation.
• Keep service records, ownership papers and spare keys ready for the handover. This makes the transfer simpler.
• Discuss the trade-in value early when negotiating the overall deal. A higher trade-in reduces the new car price.
• Consider the finance impacts. Trading in a financed car may limit options if you have negative equity.