If you’ve had a vehicle for any amount of time, eventually there comes a time when you either “junk it,” trade it in, or sell it. With trade-ins, you’re basically using what you’ve currently got in order to get some money off the new vehicle you’re purchasing. So, for example, you’ve got a 2006 Dodge Caravan with 125,000 miles on it and some rust. It’s probably worth $1000 to sell it to someone off the street, or you could trade it in… the dealer might say, “We’ll take that Dodge Caravan and give you $500 for it.” That $500 is essentially taken off the purchase price of your new vehicle.
Trading in a vehicle works well for those who don’t have the time or inclination to sell their older car or truck on the market. What are some factors that ultimately determine trade-in value?
Time is of the essence, always. Older vehicles aren’t worth as much as newer ones. So, you’re going to get more money for a 2014 trade-in than a 2006 one. Cars generally depreciate in value up to 65% within the first three years, so a vehicle that you paid $20,000 for three years ago might be worth $13,000 nowadays. Besides the year of the model, mileage matters, too. Anytime the mileage is over 100,000 red flags go up, since that’s when vehicles start having expensive problems.
Maintenance and Car History
How well has your vehicle been maintained? Is the “check engine” light on? Does it need a ton of repairs or not? Are there cigarette burns on the seats? Is there a bad odor inside? Does it still look good, or is the paint peeling? Does it have unsightly rust spots? How about “dings in the door?” Both the interior and exterior conditions of the vehicle are major factors in determining its trade-in value. If you’ve got dents in a vehicle that you’d like to trade-in, bring it to Impact Paintless Dent Repair first! The dent can be removed while keeping the vehicle’s original finish, helping retain the vehicle’s value.
Buyers generally want certain things, like automatic transmission and an air-conditioner that works well. They generally don’t want or need aftermarket/performance-based accessories. So even though a person buys custom rims for their wheels, that’s not a major factor in its true trade-in value. Even something simple like the color of the vehicle can play a role in how much money it garners if sold or traded-in. For instance, limited edition lime green may seem “cool,” but it’s not something most people want, so it can lower the trade-in value. Neutral colors like black, silver and white, though, are classic and in-demand.
Finally, where you are helps determine the trade-in value. A convertible isn’t popular in Alaska and a pick-up truck isn’t popular in Miami. Market-specific conditions matter in this regard.