What are the best practices for trading in a car?

I have a 2013 Hyundai Elantra SE with 21,000 miles, a loan left to pay off, and am looking for something like the new Ford Explorer or Hyundai Tuscon.

What are some beneficial ways of approaching this task?
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Kyle SantosCustomer RelationsAsked:
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JohnBusiness Consultant (Owner)Commented:
Most cars depreciate very quickly.

Walk in, get the best price on the vehicle you want, and then say you have a possible trade-in. See what they will give.

If you are not happy, advertise the car in the local online classifieds. You would be responsible for certifying the car for sale on your own whereas the dealer takes this risk and so take that into account.

Look for Blue Book values on line to get an idea before you start.
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Scott GorcesterCTOCommented:
John makes some good points in his reply. First go online to KBB.com and look up the value of your car. You will see "trade in" value and private party value. Trade in value is what the dealer may offer you for your car and is also known as "wholesale". Private party value is what you can expect to get if you sell your car to another individual. This can also be called "retail value".

Once you know what the trade-in value and private party value is you can compare that to what you owe on your car.  If you owe less than the car is worth the difference is called "equity" and if you owe more than the car is worth its called "negative equity".

Once you have this information you can pick out the new car you want at the dealer and negotiate with them. If they say we offer you $6000 for your trade you can say "according to KBB.com (kelley blue book) shows the trade-in value is around $7200, this may cause them to increase their offer. You can also find new car prices and dals on kbb.com.

Good Luck!

Scott Gorcester
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Michael-BestCommented:
Make sure the car is clean and polished inside and outside.
If the engine bay is dirty get it steam cleaned,
Make sure everything about the car works as it should, if not fix it first.
Have all paper work for the car and any receipts for service in dated order and presentable in a multi page clear file binder (this shows you are caring and organised when it come to your car)

Suggested reading on trading in a car:

http://www.carsdirect.com/used-car-buying/how-to-find-used-car-trade-in-locations-online

http://www.bankrate.com/finance/auto/4-steps-to-boost-car-trade-in-value-1.aspx

http://www.bankrate.com/finance/auto/8-tips-for-negotiating-a-car-trade-in-1.aspx

http://www.edmunds.com/sell-car/trading-in-your-used-car.html

https://www.carbuyingtips.com/trade-in.htm

http://www.tada.ca/10-useful-tips-on-trading-in-your-vehicle
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n2fcCommented:
Also, keep in mind that while you may get more money for a car that you sell privately, and thus may be tempted to do so, in most states you will save on sales tax when trading a car in instead.  This may offset the benefit as well as the increased hassle of dealing with potential buyers!

Another potential source of good pricing info is https://www.truecar.com/#/

As stated... DO YOUR RESEARCH FIRST!

and treat the purchase and trade-in as two SEPARATE financial decisions!

Most car dealers look to confuse buyers by COMBINING the two as a "net deal" so you are unsure if you got a good price on EITHER! Armed with the proper research, you can turn the tables on the dealer by KNOWING what the right price should be on YOUR "net deal!"
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nickg5Commented:
I'll give you my experiences and those of friends and family.

A. If you trade it in to a dealer you will get a fraction of it's resale value which is what they will do with your car. Sell it for RETAIL. Some will offer high discounts with your trade-in and the fact is they would have given you most of that discount off the sticker price to begin with.

B. Are you wanting to get rid of your car to buy a new one? Beware of dealers. We hear car dealers on the radio offering new cars at $50 over factory invoice. Wow, what a deal. No it is not. 15-20% profit for them is already built into the invoice price.

C. You best route for selling and buying is to go with individuals. Sell your car on Auto Trader or Ebay or Craigslist. As far as buying if you buy from an individual do not be afraid to ask them to let you take it to your mechanic to check it out.
Many individuals are desperate to sell, loss of job, relocation to another state, etc. There are websites where you can check out the history of the car for accidents.

D. We bought a 1996 Mitsubishi for $1,100 from a student. They were graduating and needing to sell. Their need to sell got us a good price.

E. We will never buy a new car from a dealer. The exception might be a demo car that has a few thousand miles on it. Used cars we will always buy from an individual or maybe a company that has a fleet. Or a at car auction and we have those locally once a month. Look for highway miles vs. someone who drove 150 miles a day around some big city.

F. Dealers know how to use saw dust to make a transmission run smooth. Also other tricks of the trade.

G. I personally bought 7 cars on Ebay and site unseen, only seller description, took a bus to them, and drove them anywhere from 300-500 miles home and sold for 100-200% profit. No telling what kind of trouble I would have had with those cars if bought from a dealer.

Sell yours to an individual.
Buy you new or slightly used one from an individual.
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JohnBusiness Consultant (Owner)Commented:
As I noted earlier, selling retail will incur selling costs to be taken into account and may (not likely) incur liability costs if the vehicle is (unintentionally) misrepresented. Be careful, in other words.
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Kyle SantosCustomer RelationsAuthor Commented:
Thanks for the guidance and helpful tips, best practices towards this endeavor!  We did great this weekend!

We did research on the following 2016 midsize SUVs:

The Ford Explorer
Hyundai Tuscon
and
Mazda CX-5

The CX-5 had the best reviews and highest safety ratings so we went to check them out.  We went in my car and did not bring the trade in car so we had a reason to walk out if we didn't like what we saw.  It turns out it was instant satisfaction with checking out the CX-5 and test driving the vehicle.  We asked for $12000 trade in towards the CX-5 and after some negotiation they accepted without even seeing the trade in car!  That was pretty cool.

In the end we got what we asked for trade in value and got ourselves a nice Mazda CX-5!

zoom zoom :D
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JohnBusiness Consultant (Owner)Commented:
@Kyle Santos - Thanks for the update and I was happy to help you along the way.
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