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Should You Trade In or Sell Your Car?

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If you’re a car owner and plan on upgrading your vehicle, the question of trading in versus selling privately is important to answer before you move forward with a purchase. It’s easier to trade in your car at the dealership and drive off in a new vehicle. But when is the easy solution not worth it?

Understand your situation

Before deciding if trading in versus selling privately is best suited for you, think about your situation. Consider knowing the basic information about your vehicle, such as whether your particular model is in demand and the difference in financial terms between a private sale and a trade-in:
  • In demand car. Most buyers are looking for cars with popular features, such as Bluetooth and smart car technology. If you are selling a car that is in high demand and has many marketable features that buyers are looking for, you won’t have a hard time selling it to an individual.
  • Not in demand car. Consumers are typically not in the market to buy older car models and do not come with any of the standard features that most modern cars have. Unless your older car is a classic car, you may want to consider trading in your car to an auto dealer.
  • Financial terms. The type of car and its condition will determine the sales price and potential profit you can gain. While trading in your car at a dealership is more convenient, you’ll likely receive a lower offer than if you were to sell your car to a private buyer because the dealership is going to turn around and sell the car again. To see what offer you can receive from a dealerships, you can often request a quote from their website. You can also search offers from other online auto vendors to see what type of offer you can get for your car. Or you can use sites such as Kelley Blue or the National Automobile Dealers Association to give you an average value. Knowing the value of the car can help you determine the best sales price.
First, determine whether your car is in demand or not, and understand the financial calculations and terms between a trade in and a private sale. Then you’ll be equipped with important information necessary to decide if trading in versus selling privately is best for you.

4 factors in trading in versus selling 

As you consider trading in or selling privately, there are four major factors that can help you make a decision: time and availability, marketability and condition, services and deals in your area, and convenience and value.
  1. Selling a car privately takes time and availability to dedicate to potential buyers. You should be able to show your car and schedule test drives for potential buyers. If you are not able to keep contact with buyers and have a hard time trying to schedule test drives, then handling a private sale may not be ideal for you.
  2. Familiarize yourself with the marketability and condition of your car. Whether trading in or selling privately, take the time to research the market for your particular car and the condition it is in. Some of the most basic information that buyers want to know includes the year, make, model, mileage, routine maintenance information, title and owners, as well as any repairs or issues the car has. Consider pulling out a history report on your car from various websites that will appraise the value of your vehicle.
  3. Search for alternate used car dealers in the surrounding area and the type of deals they offer. During 2021, an unusual shortage of used car availability occurred at major dealerships and at small used car dealers. Special deals and offers were hard to find and prices skyrocketed. This created an opportunity for people to sell privately.
  4. Convenience and its value vary between trading in versus selling privately. Trading in your car to the dealer is a quick and convenient approach for many consumers. This allows you to leave your old car and drive off the lot with a brand new one. Selling your car privately can take longer because you’ll have to find a buyer and negotiate the sale. But, if you’re looking for convenience and want to get more from just trading in your car to a car dealership, consider selling your car to a car buying service such as Carvana or Carmax.
Power Financial Credit Union improves the car purchase experience 

Power Financial Credit Union is here to help take the stress out of car buying. Our members can take advantage of a better car buying experience through our partner, Auto Advisors. They will get you the most for your trade in and help you find the car of your dreams. This concierge car buying service is free to Power Financial Credit Union members.

If you have any questions about Auto Advisors or about getting preapproved for a car loan, please call 800.548.5465