Here's how to get the most money possible for your old ride.
According to industry experts, used-car resale values should remain healthy this year. While that’s bad news for used-vehicle buyers, it also means that if you’re looking to trade in and trade up to a new (or at least newer) model, you should get top dollar for your existing ride. But how much you can rationally expect to receive for your current car or truck depends on a variety of factors, and it’s critical to know what your particular vehicle is worth before attempting to trade it in at a dealership or sell it outright to a private party.
Unfortunately, unlike a new car, a used vehicle doesn’t come with a manufacturer’s suggested retail price. A pre-owned model’s value is ultimately decided by the marketplace, specifically the buyer and seller, and can depend on a wide range of variables that include local supply and demand issues and, most importantly, a vehicle’s age, condition, and the number of miles on the odometer.
Checking Resale Values Online
Determine what your current vehicle is worth by searching online used-car pricing guides like Kelley Blue Book or Edmunds. They generate estimates based on your car's specific year, make and model, mileage, features, and cosmetic/mechanical condition.
With databases that are updated frequently, both sites base their estimates on data collected from wholesale auctions, both independent used-car and franchised new/used-car dealers, car rental and other fleet customers, leasing companies, and consumer private party transactions. Also considered are historical trends, current economic conditions, industry developments, and both seasonal and location-based supply and demand.
A used-car valuation site will walk you through the process step-by-step, but make sure you have all the pertinent information on your car – including make, model, color, trim level, the number of miles on the odometer, added options and, most importantly, its overall condition.
Be as specific – and honest – as possible, especially with regard to the latter consideration. For example, KBB considers a car in “excellent” condition that will bring top dollar to be one that “looks new and is in excellent mechanical condition,” while a vehicle that’s in “very good” shape is considered one that “has minor cosmetic defects and is in excellent mechanical condition.” If the car or truck is several years old, it’s most likely to be in “good” condition – which KBB says accounts for around 54 percent of all used models – meaning it, “has some repairable cosmetic defects and is free of major mechanical problems.” You’ll get far less money if your vehicle is in “fair” condition, which is described as having, “some cosmetic defects that require repairing or replacing.”
Edmunds classifies used cars as being either “clean” (some normal wear but no major mechanical or cosmetic problems), “average” (may have a few mechanical and/or cosmetic problems and may require a considerable amount of reconditioning), “rough” (several mechanical and/or cosmetic problems requiring significant repairs), or “damaged” (major mechanical and/or body damage that may render it in non-safe running condition).
How much you can rationally expect to receive for your current car or truck depends on a variety of factors, and it’s critical to know what your particular vehicle is worth before attempting to sell it.
After entering all pertinent info you’ll be asked to choose which of three types of price estimate you’d like to see. The first is a car’s “trade-in value,” which is what a new-car dealer in your area can be expected to offer for a used vehicle. This is usually the lowest price estimate given, as it assumes a dealer will have to subsequently mark up the price and perhaps recondition the vehicle to make a profit selling it to another buyer (though many less-than-perfect trade-ins wind up being sold at auction to other dealers).
The second price prediction you’ll see is the “private party value,” which is what a seller can expect to receive selling it to an individual on an “as-is” basis. This amount is usually higher than the trade-in value, though you’ll have to go through the trouble of advertising the car, fielding inquiries, and showing it yourself. Not only can that be a time-consuming process, many consumers aren’t comfortable dealing with strangers, conducting test-drives, and/or dealing with large cash transactions.
The third valuation estimate you’ll find is the “retail value," which is what consumers in your area have paid for similar cars at dealerships. This amount will usually be higher than that given for private party sales, and you’ll notice it will be much higher than a specific car’s trade-in value.
Consider other sources
While you’re at it, be sure to consult print and online car classifieds to see how these online price quotes fare compared to local for-sale listings placed by dealers and private sellers. Assume the asking prices you’ll see are negotiable and as such will likely be somewhat higher than the private party and retail values you've researched. Ignore “lowball” pricing, especially for out-of-state cars you might find on Craigslist and other sources that seem too good to be true, as they’re most likely to be scams.
If you’re trading in a recent-model car or truck, you might want to try shopping it around directly to the used-car departments of a few local new-car dealerships, and big used-car dealers like CarMax that can provide written offers that are typically good for a few days or a week after being inspected. Having a bona fide price offer in hand can be handy as a bargaining tool when trading in and buying a new vehicle; a used car’s trade-in value is usually applied to the new model’s down payment.
Whether you trade in your current vehicle or sell it outright to a private buyer, the buyer and seller ultimately determine a pre-owned car’s value.
But be aware that if you’re holding onto an older “junker” car, especially one that’s not running, your best choice may be to shop it among local auto wrecking companies who can come and tow it away to dismantle for parts, or to advertise it as being a “parts car” for garage mechanics.
While you’re at it, consider having minor repairs taken care of and dings and dents addressed before offering a vehicle for sale. Have the oil and filters changed, and perhaps even take it in for an extensive “detailing” that can bring the interior and exterior back to like-new condition. Gather past maintenance and repair receipts for potential buyers to examine. And be sure to have a copy of the car or truck’s title on hand, and make sure that it’s fully transferable.
Finally, keep in mind used-vehicle valuation estimates are just that – estimates. Again, whether you trade in your current vehicle or sell it outright to a private buyer, the buyer and seller ultimately determine a pre-owned car’s value. Also, remember that a model’s trade-in value or transaction price is always open to negotiation. Never accept a lowball offer, but by the same token, don’t expect top dollar for a car that’s in serious need of work.