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What's My Car Worth

The Best Trade In Value Car Dealership

Are you heading directly to a dealership to trade in your car?  Have you ever stopped to ask:  What’s the best place to trade in my car?

Quick Answer:

From my personal and even professional experience, CarMax has traditionally offered people I know the best trade-in value for their cars.

However,

That’s not always the case, and sometimes, you’ll need to employ some tactics to make sure places like Carmax always give you their best value! Find out how below…

Key Takeaways

  • Thoroughly research trade-in prices before negotiating using sites like KBB and Edmunds.
  • Details and maintenance history justify higher offers – provide documentation.
  • Shop quotes from major online buying sites like Carvana and CarMax to improve dealer leverage.
  • Negotiate the trade-in price separately from the new car purchase.
  • Consider timing based on vehicle demand trends to maximize value.

The Best Way to Get Top Dollar When Trading In Your Car

Trading in your old car for a new one is a major challenge.

You might have never done this before and you are going in to negotiate with someone who does this multiple times a day.

How do you make sure you get the maximum value?

Follow these tips to boost your trade-in offer and save money on your next car.

See also: Can I Trade In A Car Without The Title?

Research Your Car’s Value Thoroughly

The first critical step is determining your car’s accurate market value.

You have your standard sites like Kelley Blue Book and Edmunds provide free trade-in estimates based on factors like mileage, condition, options and demand.

Be sure to price your specific trim, features and condition accurately. You might raise the tools offers, but this isn’t a video game where you’re trying to reach a high score!

The goal is to be honest so that if you show up to collect your offer and the dealer changes it up, you can feel more confident you have done nothing wrong, because the dealers strategy is to convince you that you just don’t understand.

Providing detailed maintenance records also helps justify a higher value.

Expert tip: Get offers from multiple dealerships! Being Armed with third-party valuation reports will allow you to negotiate from a position of strength rather than guessing blindly.

Top 7 Tips to Increase Your Car’s Trade-In Value

Here are seven proven tips from myself, other car dealers, and experts to boost your trade-in offer:

  1. Wash, wax, and clean the interior thoroughly. A detailed car shows you cared for it.
  2. Fix minor dents/scratches. Large repairs aren’t cost-effective, but a clean exterior appeals to dealers.
  3. Check for open recalls and get them fixed for free. This shows responsibility.
  4. Shop dealer quotes & online instant offers from sites like Carvana before negotiating. More buyer competition drives up bidding.
  5. Negotiate trade-in value separately from the new car purchase. This helps avoid dealers hiding profit between the two transactions.
  6. Ask the dealer to provide the trade-in figure in writing to prevent changes later.
  7. Time it right based on vehicle demand trends. Trading in an AWD vehicle in winter often yields higher offers, for example.

Which Online Sites Provide the Best Offers?

CarMax

CarMax consistently offers strong valuations based on current wholesale auction data. In our analysis, CarMax provided over $1,000 above other sites’ quotes for a 2014 Subaru Forester. However, you need to visit a store for purchase finalization after getting your initial online offer.

Carvana

Carvana focuses on convenience with at-home pickup. Their online quotes are mid-range but the process is extremely smooth according to customers. Carvana gave higher offers than KBB trade-in value on a 2015 Ford F-150 and 2015 Toyota Camry in our testing.

Vroom

Vroom also buys directly with home pickup. Their values matched or exceeded KBB trade-in prices in our analysis. However, some buyers report vehicle condition issues after sale finalization, so inspection diligence is key.

Cars.com

Cars.com provides an instant offer marketplace matching sellers with area dealer bids. This allows visiting a local partner for trade-in without negotiating blindly. Offers must be redeemed at a dealership though. Customers praise Cars.com’s seller tools and support.

Facebook Marketplace and Craigslist

Facebook Marketplace and Craigslist allow private party sales for maximum value as you can potentially get retail pricing. However, this requires more effort on the seller’s part including evaluating buyers, paperwork and avoiding scams.

Must Read: Common Facebook Scams and How To Avoid Them.

Trade-In Trick/Tip:

At any point, if you want to test the legitimacy of a dealership or a car buying services offer (You think it’s too good to be true) for your car/trade-in, tell them you are still considering the purchase but would be happy to take a check and sell your vehicle to them today.

  • If they are eager to buy your car at the same amount quoted without selling you anything else, you can be sure their number is low because they feel they can profit plenty without doing additional business with you
  • If they seem unwilling to pay out their offer unless you buy something else, then you can be more confident that their offer is fair because they’re signaling that without additional business they’re not going to make much on the car by itself.

Disclaimer: As with any advice that anyone gives you about car dealerships, nothing is 100% and these are just guidelines based on my personal experiences. Salespeople follow patterns but they aren’t always predictable, so you must assess the situation in front of you rather than relying completely on what’s happened to everyone else.

Trading in your car while owing money

If your current vehicle still has an outstanding loan balance, carefully calculate if trade-in makes sense:

  • Compare trade-in value to loan payoff amount to determine if you have positive or negative equity.
  • Roll over loans cautiously – negative equity gets added to the next car purchase increasing total amount financed.
  • Weigh higher private sale prices if you have positive equity and can handle the process.

With preparation and research, trading your car can be smooth and lucrative when you’re armed with the right information. Use these tips as a playbook for getting top dollar on your trade-in.

How Does Trading In A Car Work In 2023?

A car dealership is in business to make money on a Trade In, and you should make no mistake- They Will!  Even when they take a loss, it’s toward a goal of making money some other way, usually through some incentive or bonus for selling a certain number of cars.

So, the first thing you should understand is how to trade in your car for the best value.

You may have seen or heard ads where a dealership claims to be paying more than retail value for trade-ins (These are called Trade-in Allowances).  They say things like:

  • Used vehicle prices are soaring
  • Used vehicle inventories are low
  • Used vehicles are in high demand
  • Threats over Tariffs are driving up used car values

Are these dealerships lying about these circumstances?  Actually, they usually are not.  But where they are misleading you is in the fact that:

You will be paid more than your car is worth.

You Won’t

-What will happen first is that you will receive an inspection where they will tell you that your car isn’t worth what Kelley Blue Book said it was, so they can boost their padding a bit more (Just in case). 

-The next step will be to take the remaining amount above WHOLESALE and build it into your purchase somewhere else.

That’s right, I said Wholesale.  

Dealers don’t pay retail for your car, they pay wholesale, so when a dealership promises above retail, not only do they have to find a way to get back to retail (The break-even point) but now they have to get back under it so that vehicle can turn a profit on their lot.

If, for whatever reason, things get hairy, the fallback will always be that the advertisement was written if you are purchasing a certain car.  Guess what?

That car isn’t going to be in stock.

How Do Dealerships Determine Trade-In Value?

To make things simple, Dealerships determine trade-in value by:

  • Inspecting your vehicle (Condition)
  • Comparing its condition against similar makes/models currently for sale
  • Checking retail prices (Usually through software programs, but also public listings)
  • Checking Auction Data to determine what other dealers are paying (Wholesale)
  • Assessing what you intend to buy and how much profit is available

You should take note that the figure they come up with is the absolute last you will ever be provided, if you are ever provided that number at all.

Remember:  A dealership is a business, businesses require profit or they can’t stay open to sell you more cars.

All of the number crunching and research they do is really to figure out where they will START their negotiation.  To properly combat what will inevitably be a low offer, you must be equally prepared with your own market research.

Tip: Most dealers don’t actually research the market; they rely on software tools provided by third parties.  If you can find specific vehicles in your area to base your figures on, they WILL doubt their original estimates, and this puts you in a better position-  

The position where they know you are on top of things!

Why Is Trade-In Value So Low?

Believe it or not, a lot of people research what their car is selling for online then head to the dealership and assume that is what a dealer is buying their car for.  

The Truth Is:

Dealers buy wholesale and sell retail.  Yes, it’s a simple business, but believe me, people just think differently about car dealerships for some reason.

Don’t get down about wholesale prices, though, because guess what?

Wholesale prices are no more firm than retail.  

Recently we ran an experiment with someone selling a car.  They visited two car-buying services (These places do not sell cars to the public) and one dealership.  From store one to store three, the price they were offered went up $400.  

So, which offer was the wholesale price?

Any offer you get can and will be beaten, but just like in car buying if you intend to exceed fair and get the maximum amount possible, you have to find the hungriest dealership, the dealer that does well selling your type of vehicle.

Getting The Max For Your Trade

If a “Fair” trade-in price simply doesn’t cut it for you (For whatever reason) and you want to squeeze every last dollar out of your car, then my honest advice would be:

My Final Advice: Don’t Trade- Sell Private Party!

A trade-in offer is low because you are being provided the ultimate convenience of not having to deal with the public selling your car by yourself. 

However, as with many things in life, there is a threshold at which your efforts outweigh the benefit.  

If you spend days and weeks drilling away and at hundreds of dollars on trade-in values while missing out on the thousands available if you simply sold it yourself, what have you saved?

Sources and References

You might also be interested in reading:

Steve Momot - Author

Steve Momot - Author

Steve, a seasoned expert in the automotive industry, formerly held a car dealer license in Florida. With extensive experience spanning across car trading and mechanical work, he founded Autohitch. His mission? To guide both buyers and sellers through the intricate maze of car purchasing, ensuring a seamless and informed experience. Outside of the automotive world, Steve has a passion for fishing and capturing the beauty of nature through photography.

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