The first thing car dealers don’t want you to know is what your trade-in is really worth. In order to completely understand the whole trade in value, you need to understand what the dealer will do with this trade-in, and many dealers don’t want you to know this.
Once a dealer has accepted the trade they are going to call the trade at 0 dollars. They never really paid you anything for it, so to them it is essentially a free car. If you are going to a new car dealer, they are going to either take this car straight to the auction or if they have a used car division, place it there for sale. At the auction they will get anywhere from a few hundred dollars to a few thousand. Your domestic cars like Ford and Chevrolet will get less, and your foreign cars like Nissan will get more.
Now the dealer has made all that money off of your trade and you essentially received nothing for it. A used car dealer will most likely fix your trade to almost perfect condition for a few hundred dollars and then put that car right on his lot and sell it for more that the car is actually worth.
The new car that you would be trading into is already marked up to offset the fake money that they are going to give you for your trade. So they are paid the same amount of money even if you didn’t have a trade.
In order to maximize your potential for getting more for your trade there are a few tips that have helped customers get more of their money back.
1. Tires should be free of too much wear. If your tires are bald and you want to trade this car in, go get some. They don’t have to be new. You can find some used ones cheap enough at many tire stores.
2. Make sure the car is clean. If you clean your car you will have a better chance and getting more. The dealer will have to clean or “recon” it, which will cost them time money. If it is money that they don’t have to spend it is more money in your pocket. In addition, a cleaner car represents a well taken care of car.
3. Fix any broken glass. Another thing the dealer does not want to spend money on to sell your car. You can usually go to any junk yard and obtain the glass for free or really cheap. Most places will install it for you small price. The glass is the most expensive part, if you have to buy it brand new.
4. Do your research. Cars depreciate every day. There are many websites out there that will give you an estimate of what your car is worth today. Such sites are KBB.com, Edmunds.com and the National Auto Dealers Association at NADA.com. NADA tends to be more accurate. But do your research and don’t over estimate the condition of your car.
5. Check the want ads. Find out what others are selling your car for. This will give you an accurate idea of the fair market value of your vehicle.
6. Know what repairs that the car needs. To the average person a brake job would cost about $300.00, to the dealer, about $50-$100. Call around and get prices on the items that the car is going to need to make it fully functional and safe. There are plenty of auto parts stores around where you can make a phone call and get a price on brake pads. Don’t let the dealer pull one over on you. Know what it costs.
7. Do your research on the car you are getting into. Know what other dealers are selling it for and what they would give you for your trade and go with the best deal. Just because one place is going to give your $2,000 for your trade and sell you the new one for $15,000 doesn’t mean it is a better deal then the dealer who is going to give you $1,000 for your trade and sell you the new car for $13,000. Do the math and be aware of what you are spending bottom line.
Anything that you can do to make your car look better will improve the bottom line. And the bottom line for dealers is they don’t want to spend money.