Trading in your old car for a shiny newer model is by far the most convenient way to upgrade your set of wheels. Although you will get more money selling it yourself, most dealerships will fall over themselves to sell you a great value second-hand car. The trick to getting the best deal is to do your homework and be a savvy negotiator. Follow these three steps to win at trading in.
Step 1: Estimate your car’s value
When you do your homework, you will come across three types of valuations:
Retail value: The average price a car dealer would sell your car for.
Market value: If you were to sell your car privately, this is the price that you could likely sell it for. The evaluation is based on things like mileage, vehicle condition, service history and accident reports.
Trade value: Less than the retail value, this is the amount of money that a dealership will give you for your old car. It could be more or less than market value - it all depends on demand and on how many similar models they already have on the floor.
To know how much you’ll get for your existing car, use Santam’s free online car calculator to get an estimation of what your vehicle is currently worth and what the market value is of the vehicle you’re intending to buy.
Step 2: Shop around
Although you’ve probably already lost your heart on your next car at a specific dealership, don’t allow your deal to be at the mercy of one salesperson. The more evaluations you have the better!
Print out prices from the likes of Autotrader and Carfinder, and visit three to four dealerships in different areas to find out what they’ll pay. You are likely to get more for your car if you visit a dealer that sells your brand of car so be sure to include that in your appraisals. When a dealer asks what you want for your car, start with the highest evaluation and produce the proof to back up your asking price.
Step 3: Negotiate the deal
When you’ve done your homework and found the car of your dreams, it’s time to seal the deal. Don’t waste your precious Saturdays driving around – use email to start your negotiations or call a few dealers to test the waters. If you get a bad feeling about the deal over the phone or someone doesn’t even reply to your email, move on.
Be sure to have all your car’s papers and maintenance records with you, and to give it a good clean beforehand. Once you’ve sussed out the right dealership, keep a cool head. Experts always advise to keep negotiations for your new car purchase and your trade-in separate. It’s best to not show your interest in another car before you’ve dealt with the trade-in.
Best of luck with trading in your car! If you are considering getting a car loan, this article on vehicle financing will help you understand the jargon and get the best loan possible. Want to ensure your car is adequately covered? Speak to your broker or call us on 0860 444 444 to request a quote. Visit our car advice page for more useful tips or find out more about Santam’s comprehensive car insurance.