First-Time Buyers: How to Sell Your Car

For_Sale_sign.jpg

Margot Hickson/iStock/Thinkstock

Whether you want to sell your car or trade it in, it's important to understand the process. Here's a primer, but if you want a deeper dive, check out our advice on How to Sell a Car.

Related: More #FirstTimeBuyers Advice

1. Clean the car out. Like, really clean it. Whether you're trading the car in or selling it yourself, a clean car shows much better than a dirty one. If a $100 professional detailing job is too much to stomach, a few hours and some elbow grease should do the trick.

2. Consider fixing major problems. Top off all fluids and replace burnt-out fuses or light bulbs. If your car has major cosmetic or mechanical problems, or things that need obvious changing (bald tires, for example), consider fixing them, especially if they affect the car's drivability. For any expensive repairs, you'll want to weigh their cost against the value they would add. A trusted mechanic should be able to help, but a general rule of thumb is that the older the car, the less likely you'll come out ahead on an expensive repair. A relatively cheap fix on a newer or more valuable car, by contrast, could be worth it.

3. Decide how to sell it. Trading your car in at a dealership is simple, but it adds another variable to the negotiation process and typically gets you less money than if you were to sell it yourself. A white 2008 Chevrolet Malibu 1LT with 60,000 miles, for example, would sell for $3,975 to $6,875 depending on geography and condition. Sell or trade it to the dealer, by contrast, and that range drops to $2,880 to $5,700.

4. Organize the paperwork. Make a copy of your vehicle title in preparation for getting rid of it. If you don't have the title, read Prepping Your Car for more info. If you plan to sell the car, itemize any maintenance and repair records with receipts to present to shoppers. Consider purchasing a vehicle history report, which is available on Cars.com, to give to prospective buyers. Print a bill of sale, which should have on it the car's vehicle identification number, a description of the car, the date of the sale, the purchase price, and the names and signatures of the buyer and seller.

5. If you're trading in, get multiple offers. Many dealerships will make you an offer on your old car even if you aren't buying one from them. Secure a couple of other offers in writing, and you'll have a backup if the dealership where you're negotiating on the newer car gives a lowball offer on the trade. That can throw a real wrench in the negotiations.

6. If you're selling, price and list it right. Estimate your car's value with a fair assessment of its condition, and factor in any repairs, if necessary. Search used-car listings in your area to see how other sellers have priced your model. List your car with lots of photos, and start the text with a phrase written to generate interest. Highlight certain features, including any aftermarket additions, and avoid generalities like "loaded" or "like new."

7. Find a buyer. Depending on the contact information you provided, expect to get voicemails or emails once you place the ad. Respond within 48 hours, and get the buyer's full name, email address and phone number. Highlight the car's selling points, without exaggeration, in your initial exchange, and encourage the shopper to meet you for a test drive. Follow up via email to confirm their identity, and beware of anything that doesn't seem right or check out.

8. Meet in public. Never agree to meet the shopper at your home, or drive to their home, for a test drive. Arrange to meet during daylight hours at a public place, like a large parking lot at a shopping mall or grocery store. Whenever possible, bring a friend or family member.

9. Accompany the shopper on the test drive or at least get their information. Ride along with the shopper during the test drive if possible. If they insist on going it alone, take a photo of their driver's license, or at minimum take down their name, address and driver's license number before handing over the keys. Most liability insurance covers anyone who drives your car as long as they have a valid driver's license, but check with your insurer for specifics.

10. Agree on a price, collect the payment and sign the paperwork. Collect a cash payment, if possible. A cashier's check is also acceptable, as long as you can verify its authenticity with the buyer's bank. Don't accept a personal check. Once you've verified payment, you'll generally want to sign the title over to the buyer and complete the bill of sale. Make copies of both, and notify your state's department of motor vehicles that you sold your car. The legalities of transferring ownership can vary by state, so check with the DMV for specifics. When you're through, don't forget to cancel your auto insurance or transfer it to your new car.

One final note: Watch out for scams. Deal with shoppers face-to-face and beware of anyone who wants to communicate only by email. If possible, avoid transferring the title to the buyer until the check has cleared or you've received full payment. If the buyer gives you a cashier's check, go to the issuing bank to verify its authenticity. Never accept a check for more than the agreed-upon price, and never wire money to someone who asks you to refund the difference.

See more fraud-prevention tips here.

In the market for a “cheap” car? Find cars priced at $6,000 or less near you.

First Time Buyers Selling Your Car Used Cars

Senior Consumer Affairs Editor Kelsey Mays likes quality, reliability, safety and practicality. But he also likes a fair price.  Email Kelsey