Learning whats involved in trading in a car will help you get the best deal possible.
How to Trade in a Car
1.
Probably not as good as youd like.
It always seems like an uphill battle to build (and keep) a decent amount in savings.
But what if your car breaks down, or you have a sudden medical bill?
Ask one of these companies to help… Thats because the dealership has to make a profit on the trade in.
Otherwise, it wouldnt be a good business deal for them.
Did you know?
If you have positive equity in your car meaning you owe less than what its worth thats good news.
Of course, the best situation is if you own your current car outright with no auto loan.
Then the entirety of your cars trade-in price would be applied to lower the cost of your new car.
Itll just be assessed at a lower value.
Either way, check that you get the offers in writing.
As you compare quotes, you could get dealers to increase their offers to match or beat the competition.
Just like you might haggle the price of a new car, trade-in offers are also negotiable.
Double check that the price of your new car is what youre expecting.
Its a fairly quick, easy process.
This can be especially helpful if youre financing your next vehicle.
Trading in your old car means youll pay less in sales tax for your new vehicle.
This is because the dealer needs to make a profit on the resale of your trade-in vehicle.
Limited Options for Your New Car Purchase
A trade-in is a two-part transaction.
This means, you have to get your new car from whichever dealership youre trading in your old car.
The dealership absorbs the cost of having to clean, repair and market your vehicle to potential buyers.
The trade-in value will also be lower than the price youd get selling your car to a private seller.
Nicole Dow is a former senior writer at The Penny Hoarder.
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