One of the most common mistakes car owners make when it comes to purchasing a new vehicle is falling into the trap of trading in their old one. While the thought of reducing your down payment as well as overall monthly payment by trading in your current vehicle is tempting. In reality, you usually can get way more by selling it than trading it in. Of course, the dealerships don’t want you to know that. Kelley’s Blue Book has become famous for providing car owners with estimated values of their vehicle depending on its condition. This has become a source of frustration for dealerships and car owners alike as the owner expects to get the price quoted when usually it is way lower than that We have come up with a few good reasons why should say NO to trade-ins and YES to selling.
Your Car Is Always Worth More
Based on experience, we can tell you with confidence that whatever your dealership offers you—your car is worth much more. The dealership is in the business of making money and they are going to do whatever it takes to earn a profit when it comes to your car. Most of the time if you see a lower ticket price that’s slashed from the original price you can be sure your trade-in will be less than your online quote. This is due to the fact dealerships will use the discount already in place as the amount of your trade in which can off-set their costs and leaves you with less than you bargained for.
Gives Dealership the Upper Hand
If you decide to trade in your vehicle rather than sell it you are giving the dealership the power in your car negotiation. Now they know you are looking to use your trade in as the down payment so not only can they choose the price they want to value your car at but they can also determine other aspects of your car sale. You are better off coming in with a cash down payment so you can be the one in charge of negotiations. If you choose to do a down payment AND trade in, you will find yourself in a better position to get more cash for your old vehicle.
Condition Doesn’t Matter
If your car is in new condition with low mileage, you would assume you would get more for it in trade in, right? WRONG. Most of the time dealers have a certain “allowance” for trade ins so you could end up with the same amount of money as the person who just pulled in with a clunker that looks like it should have been taken off the road years ago. This is why selling can be so much more to your advantage. If you don’t have the cash for a down payment, you are better off selling the vehicle and using that money to go towards the new car. Trading in is usually never worth it.