tell me what u know of trade ins...
09-29-2005, 01:16 PM
#1
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tell me what u know of trade ins...
im a little confused on how trade in works because il looking to trade in my Sti because im tired of trying to sell it private party (been 3 months no buyers) so i was wondering if the dealer devalues the car because i got some small door dings and scratched up rims.
09-29-2005, 01:32 PM
#2
My understanding is that the dealer will take the NADA book value for your car to the nearest "rated" condition and mileage and then adjust from there based on actual car condition. Basically, they'll offer a wholesale price for the car, with adjustments up/down for add-ons/damage.
09-29-2005, 01:35 PM
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ok, here is the best I can do
short version: they give you much less than you can get on the open market.
long(er) version: they give you much less than you can get on the open market. You do, however, get a tax break. If the car you want is 30,000 and you get 20,000 on the trade in you only pay tax on 10,000. That means you saved 20,000xwhatever your tax rate is in california. Add that to the trade-in value of your car for a more accurate statement of what you are getting on the trade in.
I have never traded a car in. I think 9 out of 10 times you will come out ahead if you can sell it privately. The dealer usually lowballs you on the trade so they can make money on it on the other side. They make a lot more money selling used cars than new ones I believe.
Also, a lot of dealers will try to give you a good trade-in price to get you in the door. What they do, afterwards, is keep the price of the car you are buying higher to make up for the difference.
From what I have read, the best way to make a trade-in deal work is to not even mention that you are going to trade-in while negotiating the price of the car. Get the price in writing, then tell them that you decided you wanted to trade in your car. Make the deal, AT THAT POINT, hinge upon the value you get on your trade in. Be prepared to walk if you don't like what you see.
Ok, that is all. Class dismissed.
short version: they give you much less than you can get on the open market.
long(er) version: they give you much less than you can get on the open market. You do, however, get a tax break. If the car you want is 30,000 and you get 20,000 on the trade in you only pay tax on 10,000. That means you saved 20,000xwhatever your tax rate is in california. Add that to the trade-in value of your car for a more accurate statement of what you are getting on the trade in.
I have never traded a car in. I think 9 out of 10 times you will come out ahead if you can sell it privately. The dealer usually lowballs you on the trade so they can make money on it on the other side. They make a lot more money selling used cars than new ones I believe.
Also, a lot of dealers will try to give you a good trade-in price to get you in the door. What they do, afterwards, is keep the price of the car you are buying higher to make up for the difference.
From what I have read, the best way to make a trade-in deal work is to not even mention that you are going to trade-in while negotiating the price of the car. Get the price in writing, then tell them that you decided you wanted to trade in your car. Make the deal, AT THAT POINT, hinge upon the value you get on your trade in. Be prepared to walk if you don't like what you see.
Ok, that is all. Class dismissed.
09-29-2005, 01:39 PM
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Wholesale = what the dealer pays for a car
Retail = what you pay for a car
The difference = dealer profit (usually a few grand)
When you trade in, the dealer will give you a certain amount for your car, say $25k.
Then they look at the price of the new car, say $35k. If you get them to give you more for the trade-in, they will sneakily raise the price of the new car to even it out. There is a lot of room on both prices so they are really sly about screwing you.
If I were you I would just lower your asking price and still try to sell privately. You'll get a good $5k less for it from a dealer so just drop your asking price by $2k-$3k and see if you get more calls.
Retail = what you pay for a car
The difference = dealer profit (usually a few grand)
When you trade in, the dealer will give you a certain amount for your car, say $25k.
Then they look at the price of the new car, say $35k. If you get them to give you more for the trade-in, they will sneakily raise the price of the new car to even it out. There is a lot of room on both prices so they are really sly about screwing you.
If I were you I would just lower your asking price and still try to sell privately. You'll get a good $5k less for it from a dealer so just drop your asking price by $2k-$3k and see if you get more calls.
09-29-2005, 01:42 PM
#6
Uh...ok. Let's try it this way then....
The National Automobile Dealers Association (NADA) publishes a book with values for used cars. They are the ones who track the depreciation schedules for cars based on many different factors.
The dealer will reference this book, which lists cost deductions or additions for certain option packages and mileage. i.e. if you have an '04 with 60K miles on it, the book will tell you how much to deduct for that mileage range. It will tell you to "add x dollars) for presence of certain options that increase the resale value of the car.
Once they've got a rough "book value" of your car, they will look at the actual condition of the car, and (in your case) potentially make small deductions for the body damage you mentioned.
Dealers take trade-ins (read: buy cars from owners) at a "wholesale" price (i.e. trade-in value), and then they sell the car at a "retail" price, which is in line with what the car is worth on the market. The difference between what they pay for the car to buy it from you during trade in and what they will resell it for is usually in the thousands of dollars. Some of that money covers costs associated with reselling it, and the rest is profit.
There are 3 car values: Trade-in (wholesale), dealer purchase (retail), and private party (which is usually somewhere in the middle of the other 2). YOu can visit www.kbb.com or www.nada.com to find the estimated trade-in value of your car.
Hope that helps.
The National Automobile Dealers Association (NADA) publishes a book with values for used cars. They are the ones who track the depreciation schedules for cars based on many different factors.
The dealer will reference this book, which lists cost deductions or additions for certain option packages and mileage. i.e. if you have an '04 with 60K miles on it, the book will tell you how much to deduct for that mileage range. It will tell you to "add x dollars) for presence of certain options that increase the resale value of the car.
Once they've got a rough "book value" of your car, they will look at the actual condition of the car, and (in your case) potentially make small deductions for the body damage you mentioned.
Dealers take trade-ins (read: buy cars from owners) at a "wholesale" price (i.e. trade-in value), and then they sell the car at a "retail" price, which is in line with what the car is worth on the market. The difference between what they pay for the car to buy it from you during trade in and what they will resell it for is usually in the thousands of dollars. Some of that money covers costs associated with reselling it, and the rest is profit.
There are 3 car values: Trade-in (wholesale), dealer purchase (retail), and private party (which is usually somewhere in the middle of the other 2). YOu can visit www.kbb.com or www.nada.com to find the estimated trade-in value of your car.
Hope that helps.
09-29-2005, 01:58 PM
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Cons: you will get much less for your STI than you would by selling it yourself,
Pro:Easy,fast and in Canada the trade-in value is deducted from the new car's price ie:tax savings for example:
Lets say that they will give you 15,000$ on your trade in and the new car will cost 25,000 before taxes....... 25K-(minus)15K equals 10K, that means that you will only pay tax on that 10K.
I would suggest that you stay patient, and sell privately, even with the tax break, you'll probably come out of it a winner compaired to trading her in,
Goodluck,
Pro:Easy,fast and in Canada the trade-in value is deducted from the new car's price ie:tax savings for example:
Lets say that they will give you 15,000$ on your trade in and the new car will cost 25,000 before taxes....... 25K-(minus)15K equals 10K, that means that you will only pay tax on that 10K.
I would suggest that you stay patient, and sell privately, even with the tax break, you'll probably come out of it a winner compaired to trading her in,
Goodluck,
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09-29-2005, 02:06 PM
#10
Originally Posted by theSTIguy
the car is financed for the another year can i pay the bank whatever i owe now in a lump sum so the car is all mine?
09-29-2005, 03:12 PM
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You can also go to www.kbb.com (kelley blue book), and they answer your questions there.
My personal advice is to work the new car price first. Don't even mention a trade. If you're asked, then say you haven't decided or that the car you're looking at may be a second car.
After you ge the price for the new car, then decide you want to trade in the old car. This helps alleviate the dealer "stealing" or low balling your trade. Sometimes dealers will try to give you a lower price on a car knowing up front they will rip you off on the trade.
Also know that your trade right now may not be worth as much due to all the incentives car manufacturers have been handing out for new cars. That automatically pushed down the worth of the older vehicles.
My personal advice is to work the new car price first. Don't even mention a trade. If you're asked, then say you haven't decided or that the car you're looking at may be a second car.
After you ge the price for the new car, then decide you want to trade in the old car. This helps alleviate the dealer "stealing" or low balling your trade. Sometimes dealers will try to give you a lower price on a car knowing up front they will rip you off on the trade.
Also know that your trade right now may not be worth as much due to all the incentives car manufacturers have been handing out for new cars. That automatically pushed down the worth of the older vehicles.
09-29-2005, 06:50 PM
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try Autotrader.com. your car will be posted for sale until sold.. ..i've sold two vehicles through the trader web site recently....or try your local CARMAX, they are known for high trade values. Worst case scenario, our local NISSAN dealer took my 04 FORD $500.00 below KBB wholesale for a brand new 05 NISSAN vehicle. Depends on the vehicle, dealers can buy their used cars at auctions $3 or 4$ thousand below NADA wholesales.
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Last edited by Ztalker; 09-29-2005 at 06:55 PM.
09-30-2005, 03:05 PM
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Originally Posted by kcobean
Auto loans are simple-interest loans, and *most* do not have an early pay-off penalty, but you should refer to your loan contract for specifics.
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