How the Trade-in Process Works
When buying a new car, having an existing car to trade in is a great way to save money and make your final agreement with Towne Ford more attractive. Surprisingly, some people are still a little unclear as to what the trade-in process involves. Hopefully, the content below will enlighten more people on this subject.
First, some important trade-in knowledge
Before beginning the trade-in process, it’s important that owners are aware of an important fact. You will virtually never get as much money value for your vehicle when you trade it in as part of a new purchase as when you sell the car yourself privately. This makes sense when you think about it. A dealership will likely want to sell your car for a profit, even if only a small profit. That will be a big part of their consideration. When you’re trading-in, part of the deal is you lose some of the real monetary value for the sheer convenience of trading in your car while buying your new one.
Start the Process by Getting Your Car’s Estimated Trade-in Value
A good place to start is by getting your own estimate online on how much your car is currently worth as a trade-in. For that, you could use something like the Edmunds car appraisal tool, which is an easy way to gain an accurate idea on value. Do not confuse the trade-in value with the private sale value of the vehicle.
The best policy is to be brutally honest about your car when getting your own appraisal. The point here is to get the most accurate estimate possible so that you can have a good idea if you’re getting a fair deal from Towne Ford when the time comes. The goal is not to maximize the estimate by embellishing details about the car’s condition.
Next, It’s Appraisal Time
Armed with the knowledge of what your car’s trade-in value should be, you can now visit Towne Ford to get an appraisal. You may have to arrange this in advance if you want to avoid long waits during busy hours. Towne Ford will typically have someone who especially deals with appraising used cars and their appropriate trade-in value.
The good news is that dealerships are very aware that many will have looked into the potential trade-in value using platforms like Edmunds. This being so, they are not likely to differ wildly from the estimate you got, provided that you provided accurate information when getting your own estimate.
The first part of the appraisal will be what is often called a “silent walk-around.” A Towne Ford appraiser walks around your car pointing out all of the flaws and imperfections. The point of this is to strengthen their own negotiating position, of course. After the walk-around inspection, they will get into more detail, including inspecting the windshield, the fluids, the doors, hood, trunk, the buttons and switches on the interior and anything else they deem to be important. It’s also very likely they’ll conclude with a scan of the VIN to look up the car’s vehicle history report.
Finally, they’ll test-drive the car and see how it is on the road. The test drive will be around 3-5 miles, and certainly not more than that. They don’t want to add too many more numbers to the odometer. After the process, they’ll determine a value based on what they know they can do with it. For example, if they can only auction it, they’ll offer you a price somewhere below wholesale value. If they can sell it retail, then they’ll offer you something below retail value.
After That, You Can Negotiate on the Wider Terms
The appraisal is the principal part of the process. Once that is over, you can then factor in your trade-in quote to your wider negotiations. If you’re trading in as part of buying another car, then you can negotiate for how the trade-in impacts the overall monthly price and terms of your finance deal.
If you are trading in for cash, then you might have some room to negotiate on price, but it’s unlikely they’ll move much unless they had compelling reason to believe you could take it somewhere else and get a better deal.
The end of the negotiation is the end of the process, and that’s all there is to it.
Conclusion: Know the Process, and Avoid the Mistakes
When you know what happens in the trade-in process, you can easily avoid some of the key mistakes. Perhaps the biggest thing people get wrong is investing money in minor repairs, new tires or a new windshield in the hopes that it would increase the estimate they receive. In a private sale, these things would help, but not for trading in.
When you realize and understand that trading in is not the same as selling privately, you can avoid disappointment and other pitfalls.