What if Your Car Is Worth More Than the One You Are Trading For?

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Trading in your vehicle for another is usually a convenient process. Dealers are happy to take a used car trade-in, as they generate more profit than new vehicles. However, when it comes to trading down for a cheaper vehicle, it may become complicated, as dealers don't like to give cash back. In this case, you may pursue other options.

  1. Negotiate With Dealer

    • Dealers don't like to give money back on trade-ins. However, if a dealer can make money on the car you are trading in, he will be willing to negotiate with you. Before you can negotiate, you will need to know exactly how much your vehicle is worth according to used vehicle guides, such as Kelley Blue Book and NADA. You may want to check the dealerships in the area to see the prices for vehicles similar to yours. The dealer will try to give you the lowest price for your trade-in, but if you have these numbers in your hand, you may be able to get more money for it.

    Dealer Consignment

    • Some dealers may offer consignment for your trade-in if they are unwilling to give you the difference when they take your vehicle as a trade-in. Some dealers sell your vehicle and take a percentage of the sale price for their service. This option may be convenient and quick, as the dealer will market the vehicle and give it enough exposure to customers. However, you may need to have another vehicle available to drive if you need to leave yours at the dealership during consignment.

    Selling the Vehicle Yourself

    • The trade-in price for your vehicle is usually lower than what you can get through a private-party sale. If you are looking to get more money for your vehicle, list it through a local newspaper or by advertising it online. This option may take a little longer, but if you are willing to price your car slightly below its value, you may quickly find a buyer. However, if you have your vehicle financed through a bank, you may not want to lower the price to less than the loan balance. Otherwise, you will need to pay the difference.

    Considerations

    • Having a loan on the vehicle you are trading in may complicate the trade-in process. You will need to pay off the loan when you trade your car in. Part of the money will come from the loan proceeds for the new car, assuming you are financing it. The difference may come from the dealer if he is willing to give you the trade difference in cash. You will need to pay any deficiency yourself. Otherwise, the bank will not release the lien to your vehicle.

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