Tips from our Sales Departments:
- Trade-in values vary widely, as physical condition, mileage, potential
mechanical problems, normal wear and equipment specifications must be
considered.
- Lease vehicles may also be traded in, and the remaining period/balance
on the lease determines how much your new monthly payment is affected.
- Use your trade-in vehicle as a point of negotiation when purchasing a
new car. Dealers sometimes give fantastic deals as further incentives
to buy new or pre-owned vehicles.
- Trading in a vehicle you do not fully own or are leasing can save you
costly monthly payments. Consumers often switch to vehicles that better
meet their needs or fit their budgetary requirements.
- Trading in your current vehicle is an easy way of partially offsetting the cost of buying a new or pre-owned model.
Why trade-in?
Trading in your current vehicle towards another can partially offset
the cost of the new vehicle. The trade-in's net value goes towards the
purchase or lease of a new car. Conditions of a trade-in vary depending
on who owns the vehicle.
If you own the vehicle, trading-in means
that you're selling the car to the dealer for some determined price. As
a result, the price of the new car goes down, only.
If you are
leasing a vehicle and do not own it, trading-in means that the seller
of the new car agrees to pay the outstanding costs associated with the
lease. Depending on the financing of the new vehicle and the
outstanding balance on the old one, trading-in can either raise or
lower the new car's price.
Why is it beneficial to trade-in?
When you trade-in you don't have to worry about selling the vehicle
yourself or any of the associated costs (advertising, showing the car,
etc). A dealer may offer a price you could not get yourself as an
incentive to purchase a new vehicle. If the trade-in has known problems
that could plague you later (when the buyer returns complaining),
selling the car to the dealer eliminates the bother. Trading-in a lease
car may relieve you of, in the long run, monthly costs you cannot
afford. Sometimes people trade in lease vehicles because of poor gas
mileage or lack of practicality.
Why decide against trading-in?
If you think you can get a better price selling privately, and it's
worth the time, money and effort, do not sell to the dealer. Some cars
are of special interest and dealers will not always recognize those
interests.
What happens to a trade-in?
Some are kept by the dealer and resold as used cars. Many are sent
to auction and purchased by other dealers for resale. Dealers know that
auction prices often will not match the sum credited toward a new
vehicle, but they absorb the losses as sales incentives.
How much can I expect to get?
Check used car values in guides issued by organizations such as
Edmunds.com or the National Automobile Dealers Association (NADA).
Often both trade-in and private sale values are listed. Factors such as
mileage, overall condition, damage and known mechanical problems
heavily influence the trade-in value.
