After your trusty car gives you years of service, there comes the time when you have to finally let it go. Herein comes the million dollar question. What should be done with used cars? There are usually two options available, one is to either sell it to another party and the other option is to trade it with a dealer. There are pros and cons with both these processes.
To sell or not to sell?
What is a trade off? This is usually where the car is given to a dealer who assesses the car’s value and takes that amount off the price of the new car that you are purchasing. The dealer will factor in various variables like the age of the car, its condition, etc and make a trade value for the car. The advantages of a trade include the fact that it incurs the least hassle of all. This takes the shortest time and there is not much fuss or annoying paperwork. Another advantage is that, once the trade is done there is no liability that the seller assumes. You won’t have to deal with issues like your car breaking down once it has been sold.
Other advantages of a trade include not having to prep your car up for a sale. Also, there are certain tax advantages that are to be had if you trade it. in many states, you only have to pay sales tax on the amount which is the difference between what you received as trade value and the price of the new car. In states with a high sales tax, this poses a distinct advantage. It is the most convenient next step for used cars. There are no advertisements to be given, or test drives which have to be arranged for the buyers.
The big disadvantage of a trade is that the amount that will be given in exchange for the car will be significantly lower than the price that you will get if you sell it in the market.
Selling used cars
To sell used cars, many factors have to be taken care of. The first step is to do an honest assessment of the condition of the car. You will have to take a call on how much money you would want to spend on some repairs on the car. Always keep in mind that there is a legal liability involved. To avoid any post sale problems with the buyer, make sure that the car is in good shape.
The second step is to determine the value of the car. Most auto dealers suggest using Kelley Blue Book values as a starting point. Also, get a trade in value and a retail value and then fix the price at a figure in between. Also, get an idea of the local market prices to get an idea of how much you should be charging for your used car.
After this comes the advertising phase. Place your ads in the classifieds, specially the used car publications. Calculate the costs involved in placing ads and make sure you regulate it. Once buyers start contacting you, start arranging for test drivers for the parties followed by negotiations. Once you have negotiated the price, arrange for the paperwork and also cancel your insurance on the car.
One last idea for used cars is to sell it through a dealer. In exchange for a certain amount of money, dealers can sell your used car. It becomes their responsibility to go through all the processes.
About the author
Tom has been an auto sales manager for the last five years. He has worked with hundreds of customers to help them select the right new car and sell junk car for a good value, using dynamic sales techniques. In his spare time, he loves going on long drives in the countryside.