Cars are expensive, there’s no question about that. The good news is that buyers have a lot of options at their disposal when it comes to purchasing them. For instance, buyers with good credit can either lease or finance a vehicle to own. Leasing consists of making monthly payments until it’s time to turn the vehicle back in and the latter consists of making monthly payments until the vehicle is paid off. Then there is the cars for cars option.
Most vehicle purchases require some sort of down payment. To accrue the money necessary for a car down payment, you can either save until you have a reasonable amount in hand or you could try selling an existing car or trading it in and putting what you get from it toward your down payment. This post will take a closer look at trading in a vehicle, when it makes sense and when to consider selling it by owner instead.
Trading in a Vehicle 101: What You Need to KnowTrading in a vehicle is simply the act of taking said vehicle to the dealership where you plan to make a new vehicle purchase. While at the dealership, your car will be assessed and you’ll be given the dollar amount that the dealership is willing to give you for it to put toward your new vehicle purchase. That’s the pleasant thing about trading in a car versus selling it by owner – you only deal with one party (the dealership), the appraisal process is fast and easy, and the dealer will handle all the legal logistics regarding the title of the vehicle.What’s more is at the end of the day, you’ll be able to put what you’ve earned off your trade in toward your new vehicle purchase right then and there, which helps lower the overall purchase price.Another neat benefit about trading in a vehicle is that you can use trade in value as a bargaining chip when it comes to shopping different dealerships for a new car.
Trading in Versus Selling by OwnerWe’ve already detailed many of the benefits of trading in an old car for a new car above. Selling a car also has its share of benefits, namely that you can often get more for a car when you sell it by owner than you could by trading it in. Depending on the vehicle you’re looking to unload, the difference between trading it in and selling it could be the difference of anywhere from several hundred dollars to several thousand dollars. But when you sell a car, you’re at the mercy of the buyer. So, for instance, it could take weeks or months to sell, which can be unappealing.Plus, you should make a point to be around when interested parties want to come, see and test drive the vehicle, which can be inconvenient. Finally, you also have to handle all the paperwork and title transfer details yourself as well. This last part is generally pretty simple, but it’s an additional step within something that’s so easy and streamlined when it comes to trading a vehicle in.
So, what’s better when it comes to netting the most to put toward a new car – selling it by owner or trading it in? That choice is yours to make. Generally speaking, if you have a classic car or a less common vehicle that will be highly sought after, it’s worth it to sell by owner. But if you’re just looking to trade in a car in the easiest and most convenient way possible, you really can’t beat going the trade in route.