Sunday, June 10, 2012

How to Negotiate for Auto Financing with a Vehicle Trade-In

Whether you are buying a new car or a used car, you can look into options for a vehicle trade in for great deals. A trade-in is a beneficial way to bring down the overall cost of your new vehicle, and consequently, your auto loan amount. However, before you begin negotiating, there are a few things you should be sure to do. It is important to enter into negotiating with your car dealer as prepared as you can be.

RESEARCH YOUR VEHICLE’S CURRENT VALUE

The trade-in value of your car is dependent on its blue book value on the open market. Finding the value of your car is not difficult and can be done on the Internet. Nonetheless, be sure that you use a reliable resource, such as the Kelley Blue Book. The Kelly Blue Book takes into account factors such as the age, condition, and mileage of the car, as well as its luxury and safety features. However, you should find both the retail and wholesale values of your trade from more than one reliable source. This will put you in an informed bargaining position with your dealer.

PREPARE YOURSELF AND YOUR VEHICLE

Before going into the dealership, give your current vehicle a good cleaning: pick up any trash, vacuum the interior, and wipe down the windows. It may also be worth it to have any dents and scratches taken care of beforehand, as such imperfections may give the dealer cause to give you a lower trade-in value for the vehicle. Similar to selling a house, you want to remove all personal items from the vehicle and make both the interior and exterior as appealing as possible.

UNDERSTAND THE DIFFERENCE BETWEEN ORIGINAL AND AFTERMARKET PARTS

A car’s engine ages and wears as it gleans miles. And while the other parts continue to age and wear, if a new engine is put into an old car, that particular engine will not have those cumulative miles on it. The same is true for all components of the vehicle, including options such as the audio system, brakes, tires, and other parts. If you have replaced any parts of your trade-in vehicle or added any new options to it, be prepared with any receipts and paperwork for those parts. The less work that the dealer must do to your trade vehicle, the more likely it is that you will be allowed a higher trade-in value for it.

BE FAMILIAR WITH THE MARKET

It is important that you research the current market for your trade. If your intention is to trade in a V8 sport utility vehicle whose fuel economy averages 18 miles to the gallon, you cannot expect to get a high trade-in value from a dealership when consumers are more interested in purchasing hybrids. If the dealer is going to have your used car sitting on his lot and garnering little interest, it is unlikely that you will get a high trade value.

SHOP AROUND

Be prepared to shop around. Having researched your car’s wholesale and retail values, as well as the values of any aftermarket options, you know what range your trade value lies within. And if you feel you are not being given a fair deal, feel confident to search for a better deal.

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