How Does Trading in a Car Work?


Quick Answer

Trading a car in is a relatively simple proposition that involves taking a vehicle to a dealership, agreeing to a trade-in value, and then signing some paperwork. It pays to do homework ahead of time to ensure the best value for the vehicle.

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Full Answer

People who want a different car have two options for the current car: either trade it in or sell it on the open market. Both have pros and cons; selling it brings more money, while trading it in means less hassle.

A person who decides to trade in a car needs to do a little work before going to the dealership. Finding an estimate is as simple as looking up the value of the car on the Internet on sites such as Edmunds.com or KBB.com. Entering the year, make, model and condition of the car provides enough information for those sites to return a pretty close estimate on what the car is worth as a trade-in.

Once armed with this information, the seller should thoroughly clean the car inside and out. The seller then takes the car to the dealership and gets an appraisal while picking out a new car. He then has the option of accepting the trade-in offer, negotiating, or refusing it outright and walking away. Some dealerships like to low-ball offers to customers in the hopes of obtaining a good deal. A seller should not be afraid to negotiate and stick to his guns to receive a fair offer.

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