When buying a new car, there are a couple of starting points for your negotiation: the car’s MSRP (listed on its window sticker) and the invoice price (the price the dealer pays for the car). But imagine trying to buy a new car without having any idea what its price is — that’s what happens if you try to trade in your car without knowing how much it’s worth.
Related: How to Get the Best Offer for Your Trade-In
Determine What Your Car Is Worth
Cars.com provides estimated values for used cars, which should give you a good starting figure for negotiations when you go to a dealership to trade in or sell your car for cash. But remember, it’s only a starting point.
It’s important to be honest about your vehicle’s condition when estimating its value. Many consumers minimize their cars’ flaws, but doing so will only leave you disappointed when the dealership offers you less than you’re expecting.
Mechanical problems, body damage or lapsed maintenance issues, such as bald tires, will likely lower your vehicle’s value and the trade-in offer. The same is true for interior stains, upholstery tears or foul odors: One dealer said if a car’s interior smells like smoke, he simply won’t take it because of how difficult such cars are to sell. In addition to the condition, other variables like mileage, accident history, and the reliability and brand appeal of the vehicle will determine its value.
It May Be Worth More Than You Think
While you want to be realistic about the car’s condition, you also don’t want to underestimate its value — especially nowadays. As the inventory shortage drained the supply of both new and used vehicles, average trade-in values shot up, reaching a peak of $10,050 in June 2022, according to J.D. Power. As new-vehicle supply gradually improves, trade-in values have started to drop: The average for February 2023 was estimated at $8,955. The good news? That is still more than double the average amount seen before the inventory shortage. If you want to make sure dealers are being upfront with you, ask them how they landed on the offer. Many will show you the places they’re checking to evaluate pricing. For example, they may look at what local auctions are paying for cars like yours that are in the same shape and with the same mileage. Many dealers want to create a transparent experience that gets you to come back, even if you’re not in the market to buy a car when selling yours.
Compare Multiple Offers
Sanity-check your offer by taking it to other dealerships and used-car retailers, including CarMax, to see what they are offering. Getting multiple offers and going with the best one is a smart way to ensure you’re getting the most money for your used car. But you should move quickly; if you take a couple of weeks to make all your visits, dealers may lose interest in your car.
One more tip: You may get more if you take your car to a dealership that sells the same brand. Many automakers have certified programs, where newer model-year cars with relatively low mileage can be resold as certified pre-owned vehicles. Because dealers are aware of the market demand for your model, they might be willing to go a little higher with their offer if your car fits those age and mileage requirements.
More From Cars.com:
- Should You Trade in Your Car or Sell It Privately?
- What Are the Used Cars With the Highest Rising Resale Value?
- First-Time Buyers: How to Sell Your Car
- How Should I Prep My Car for Sale to a Dealer?
- Common Mistakes When Selling or Trading to a Dealer