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What to Do with Your Car: Trade-in vs. Private Sale?

When buying a new car, many buyers no longer need their current automobile and want to either trade their car in at a dealership or sell to a private buyer. Both strategies offer advantages and disadvantages. Generally, trading a car in tends to be easier, but selling a car on your own can net you a better return.

Benefits of trading a car in

If you’re buying a car from a dealership, you’ll usually have no problem receiving an offer for your current car while purchasing your next vehicle. A trade-in vehicle offers you instant, up-front cash that you immediately apply to your vehicle purchase. 

The catch? You probably won’t be getting the most money possible for your car when trading it in. In order for the dealer to make money on your vehicle, they need to be able to re-sell it at a profit after accounting for the costs they incur when buying it from you and preparing it for sale, so the price they offer will typically be considerably less than the market value of the car or truck.

Trading your car in is a great way to get a quick return on your vehicle without any hassle. If you’re too busy to prepare and list your car for sale, or if you feel the sales process is more trouble than it’s worth, you should consider trading in your vehicle. That way, you can start enjoying your new vehicle as soon as possible. 

How do I sell my car?

If your top priority is getting the best financial return possible on your current car, selling the car yourself is probably a better option. If you conduct a private sale, you can usually sell the car for a price closer to its market value. 

To successfully sell your vehicle, follow these five easy steps:


Use a variety of online resources to research and evaluate your car’s market value. Cars depreciate over time, but some makes and models take longer to depreciate than others. Likewise, well-maintained cars with low mileage and an accident-free history will fetch better prices than others.

Defining your car’s value is essential to listing your asking price accurately and negotiating. The original purchase price of your automobile will be the primary source for establishing the used price, followed by mileage, service history and accident history. If you know a car’s market value, you shouldn’t accept a significantly lower price unless you have a good reason.

Many private sellers rely on Blue Book values, but it is usually also a good idea to look at listings for similar vehicles in your area. If you can get a feel for the low and high marks for similar vehicles, you’ll have an easier time pricing your car to sell. Of course, there’s nothing wrong with pricing your vehicle at the higher end of the scale if it is in good shape, but just understand that your listing won’t jump out at buyers as quickly as more competitively priced vehicles.

Prep your car for sale

Short of major repairs, there are several simple things you can do to improve your car’s appearance to attract a seller. First, make sure your car is clean inside and out. A prospective buyer will almost certainly want to test drive the vehicle, and a dirty car can be discouraging. A clean car can seriously improve the prospect of a sale and prevent a buyer from attempting to lower the price for minor imperfections.

Begin by washing and waxing the exterior and cleaning and vacuuming the interior. You may also want to shampoo the carpets and upholstery to make sure the vehicle smells clean and fresh. Hiring a professional detail shop to buff the vehicle can also be a worthwhile investment if the finish has grown dull over time. If the headlights are clouded, consider purchasing a product to remove the film on the plastic and restore the appearance. Fuses are relatively inexpensive, so if there are electronics or other components in your vehicle that aren’t functioning correctly, check the fuse associated with the item (these can be found in your owner’s manual) and make sure it isn’t blown. Finally, check all of the fluid levels, clean up any signs of minor fluid leaks, and consider replacing the windshield wipers.

List your vehicle

Many people rely on the Internet to shop for cars, so listing your car online is a great way to sell it. Listing your car online is also affordable and easy, and many public sites don’t even charge a fee or require a sales commission for your car to be posted. When listing your car, be sure to post a number of high-quality photos. Include photos of the interior and exterior so users can get a better sense of the vehicle. A consumer might become suspicious of the car’s condition if not enough photos are posted.

Next, write an accurate and compelling description of the vehicle. Include relevant facts like mileage, previous owners, and vehicle history. If you think your car might appeal to a specific kind of buyer (first-time car owner, college student, etc.), be sure to mention it. Finally, if your car has any flaws, defects or problems, mention them. It’s better to be honest in the car’s description so buyers can make an informed purchase.

Field offers

Once your vehicle is posted, with any luck you’ll receive interest from prospective buyers. In your conversations, answer buyer questions honestly and to the best of your ability. Admit any defects in the vehicle while continuing to emphasize the car’s selling points. If the buyer is interested, suggest a meeting in a public place or at your home. Allow the buyer to take a test drive, and ask to hold his license or a credit card while he’s driving. When discussing the sales price, you should anticipate an offer below your listed price. If the offer is earnest, attempt to negotiate a price between the offer and your original listed price. If the buyer is satisfied, accept the offer. The buyer should understand that the cost of registering the vehicle, transferring plates and obtaining tags falls on him or her, and the buyer should do so as soon as possible. Additionally, the buyer will need to pay a sales tax when registering the vehicle.

Close the sale

Once an offer has been made and accepted, you will need to provide the necessary documentation to legally transfer ownership of your vehicle and release yourself of future liability. Typically, this involves signing over the car title to the buyer with a notary present. A vehicle title serves as legal proof of ownership for a particular automobile and should have been included when you purchased your vehicle. If you’ve lost or misplaced your title, you will need to obtain a replacement from the Bureau of Motor Vehicles (BMV) before completing your sale.

To transfer the title, you may need the buyer’s name and address, the selling price, a mileage reading from the odometer and a signed, notarized bill of sale. You’ll also want to make a copy of the completed, notarized assignment of the title for your records. Requirements vary by state, so check with your local BMV to ensure you’re following all of the correct steps for transferring ownership, including contacting the BMV to confirm the title transfer once the sale is complete. Finally, once the sale is finished and you’ve ceased to be liable, adjust your insurance coverage to reflect that you no longer own the vehicle.

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