Before you can buy a new car, you’ve got to figure out what to do with your old one. You could always try to sell it yourself but if you don’t have cash for the down payment on a new car, trading it in may be the better choice. Trying to haggle with a car salesman can be a bit like pulling teeth. But just as you should take your time when buying your first house, you shouldn’t just accept the first offer someone makes for your old car.
Find out now: How much do you need to save for retirement?
Negotiating a better deal requires some homework and more than a little patience on your part, but it’s a smart investment of your time when you’re trying to get the most value possible. If you’re ready to put your bargaining skills to the test, here’s what you need to know.
1. Figure Out What Your Car Is Worth
The first step in negotiating a trade-in is to have a realistic idea of what your car’s value actually is. There are a number of resources available to help you pin down an appropriate figure, starting with Kelley Blue Book and Edmunds.
Comparing values on multiple sites should give you a range of values that you can use as a jumping off point. From there, you can take things a step further and have a used car salesman or three look at the vehicle and tell you what kind of offer they’d make.
Once you’ve got an idea of what the car is worth, you’re in a better position to set your own trade-in price. When the dealer opens up the door and asks how much you want for the car, it’s easier to start at the higher end and work your way down than to go in low and try to push the value up.
2. Make the Car As Appealing As Possible
Car dealers don’t want to pay a lot of money for a vehicle if it’s going to be tough to turn around and sell it for a profit. Getting your car in tip-top condition before you head out to the lot is critical when you’re planning on making a trade. Having it detailed inside and out, getting the oil changed or the engine tuned up and making sure that everything is in good working order can make it more desirable in a salesman’s eyes. Of course, before you do any major or expensive work, it’s a good idea to consider whether it will be worth it.
3. Time Your Trade Carefully
Certain times of the year are better than others to trade-in a vehicle, depending on what type it is. In the summer months, for example, car buyers have got their eyes peeled for convertibles but come winter, trucks and SUVs will be in high demand. Paying attention to what the trends are ensures that your trade-in is what people are looking for.
It’s a good idea to also keep an eye on where gas prices are when you’re planning to buy. If they’re fairly high and you’ve got something that gets great fuel mileage, that’s something that car dealers shouldn’t have much trouble selling. On the other hand, if you drive a gas guzzler and prices are sky high, the salesman may be more reluctant to cut a deal.
4. Be Firm About Your Limit
When you’re researching car values, you need to decide how much you’d be willing to take for your vehicle at the low end. Car dealers aren’t shy about trying to get away with paying you the least amount possible so you need to know where your cutoff is and stick to it.
If you make it clear that you’re willing to walk away, that puts you at an advantage, especially if sales have been slow and the dealer is shy of their quota. In that scenario, they may be a little more reasonable about giving you what you want or something close to it to put you in a new car.
Photo credit: flickr