Should I Trade In My Car or Sell It Myself?
In the current market, your vehicle may be worth a lot more than the dealer will give you.
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While many shoppers meticulously research the vehicle they plan on buying, what you do with your old car shouldn’t be an afterthought. In the current market, your vehicle could be worth more than you think, and how you sell it could increase your payout by thousands of dollars.
With the chip shortage causing production delays and limiting dealership supply of new cars, many people have turned to the used market for their next vehicle. That larger buyer pool can raise the value of your car, so before you even talk to a dealer, consider your options. If your car still runs reasonably well, you can:
Trade it in when buying your next one
Sell the car to a different dealer
Or sell it privately
The best option for you comes down to how much you value money and your time.
The Easiest Option: Trade In Your Car
Dealerships make it easy when you’re wondering if you should trade in your car or sell it yourself — trading in can be a simple process that’s built into your new vehicle purchase. The dealership will appraise your vehicle and make you an offer. If you accept it, the dealer will deduct the agreed-upon amount from the price of the car you’re purchasing, reducing your down payment, your monthly payment, or both.
This method requires the least amount of time and hassle, but you’ll likely pay for that convenience with an offer that’s lower than the vehicle’s true worth. That’s the only way the dealership can make a profit when it resells your car. On the plus side, in most states, you’ll pay taxes only on the difference between the cost of the new vehicle and the amount received for your trade-in.
Also keep in mind that it is perfectly acceptable to negotiate the value of your trade-in, particularly right now with the shortage of vehicles forcing dealerships to make higher offers to stock their lots. Check your car’s value via sites like Kelley Blue Book, Edmunds, and Autotrader and go into the negotiation with confidence. If the dealership won’t give you an acceptable number, others likely will.
More Time and (Maybe) More Money: Shop Your Car Around to Other Dealers
Given the current car shortage, another dealership may be willing to pay more for your old ride. It’s just a matter of finding a motivated buyer. You can try calling local dealers, but a large, nationwide chain may have deeper pockets. In 2021, virtual dealerships such as Carvana offered used-car sellers significant dough for their vehicles. And the process is easy: Simply input your vehicle’s information and condition into an online form and you’ll receive an instant offer.
What’s more, this method allows you to sell a car with an existing loan with minimal hassle, presuming the offer exceeds the amount due to the bank. The dealer may send a truck to pick up your car or require you to drop it off somewhere. Once that happens, the dealer will pay off the balance of your loan (if you have one), and issue you a check for the difference.
The Biggest Payday: Sell Your Car Yourself
While trading your car in can be very easy, selling it yourself privately may be the best option for netting the highest dollar amount for your car. It also typically requires the largest time commitment. This is an excellent option if your vehicle is paid off or if you have the funds to pay it off prior to selling it.
As with the other options on this list, you should start by determining the value of the car. Then you need to decide what to ask for and what’s the lowest you’ll take when a buyer tries to negotiate. Have all that figured out? Great. Now it’s time to cast a wide net.
The simplest way to sell your car is to list it online. Advertise it on social-media marketplaces as well as on community boards and your profiles. You can also publish a listing on classified-ad sites (Craigslist, Hemmings, Autotrader, etc.) to extend your reach. Be sure to include as many details as possible, including service notes and logs, photos from every angle (including under the hood and chassis), and perhaps even a walkaround video. This will — hopefully — save you from having to answer the same questions over and over again.
If you’d rather not deal with internet strangers, alert your friends, family, and coworkers of your intent to sell. They may know someone who’s in the market. And if you have a highly visible place to park your car that sees a lot of traffic, try putting your vehicle out on display with a “for sale” sign in the window. Make sure to note the model year, mileage, sale price, and contact information on the sign.
Lastly, be sure to look into your state’s laws with regard to private sales. Some require you to obtain a bill of sale or follow various vehicle-transfer requirements in addition to signing the back of the title.
