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Is trading a vehicle in really all that stupid?
Posted on 2/11/14 at 5:46 pm
Posted on 2/11/14 at 5:46 pm
About to flip my truck for a newer model.
Good friend told me never trade-in as you are always leaving thousands on the table.
But if I can get within $1500-2000 of the private party value listed on Kelley Blue Book, it's almost a tax for convenience as opposed to listing on Craigslist, Autotrader, etc. and waiting for a potential buyer to come out of the woodwork.
Also, I'm looking at a new 2013 and those being priced aggressively. If I am unable to sell my current vehicle in a timely manner, I will probably have screwed myself on very aggressive current pricing.
Good friend told me never trade-in as you are always leaving thousands on the table.
But if I can get within $1500-2000 of the private party value listed on Kelley Blue Book, it's almost a tax for convenience as opposed to listing on Craigslist, Autotrader, etc. and waiting for a potential buyer to come out of the woodwork.
Also, I'm looking at a new 2013 and those being priced aggressively. If I am unable to sell my current vehicle in a timely manner, I will probably have screwed myself on very aggressive current pricing.
Posted on 2/11/14 at 5:47 pm to okietiger
i am a 100% buy used and pay cash guy. no problem trading in one for another.
Posted on 2/11/14 at 5:51 pm to okietiger
quote:
Good friend told me never trade-in as you are always leaving thousands on the table.
you need to compare how much more you would get private party vs the amount you save in tax by trading in. I recently traded a car in and it was pretty much a wash
Posted on 2/11/14 at 5:55 pm to ljd4662
I'd be leaving between 1500-2500 on the table if I trade in.
BUT, there are rebates ending soon at Ford dealerships plus they are aggressively pricing new 2013 models to get rid of them.
So I might make $2500+ in a private party sale over a trade in but I could screw myself by not finding the vehicle I'm looking for at the current price they are going for.
BUT, there are rebates ending soon at Ford dealerships plus they are aggressively pricing new 2013 models to get rid of them.
So I might make $2500+ in a private party sale over a trade in but I could screw myself by not finding the vehicle I'm looking for at the current price they are going for.
Posted on 2/11/14 at 5:55 pm to ljd4662
quote:Yes, a lot of people are unaware of this. The value of a trade in is subtracted from the price of the new vehicle for tax purposes.
you need to compare how much more you would get private party vs the amount you save in tax by trading in. I recently traded a car in and it was pretty much a wash
Posted on 2/11/14 at 5:58 pm to eelsuee
I'd probably get $24k private party and $21-22.5k for trade-in according to KBB.
Posted on 2/11/14 at 6:14 pm to okietiger
Fords current rebates include 1500 trade assist
If you choose not to trade in, you will likely lose 1500 of the stated rebates also
If you choose not to trade in, you will likely lose 1500 of the stated rebates also
Posted on 2/11/14 at 6:19 pm to okietiger
quote:
I'd probably get $24k private party and $21-22.5k for trade-in according to KBB.
If those numbers are accurate then you would come out the same financially either way. Might as well just trade it in and avoid the extra work.
Posted on 2/11/14 at 6:31 pm to okietiger
quote:
I'd probably get $24k private party and $21-22.5k for trade-in according to KBB.
Probably is the key word... Do you have the title in hand?
If not, good luck.
I just traded in a vehicle. I had it listed for almost a month with no inquiries, traded it in for exactly what I wanted for more than I would have gotten private party if you include the tax incentive. Also, because I didn't hold the title, it was easy as shite trading it in.
Posted on 2/11/14 at 7:02 pm to okietiger
If they will offer you trade in within 2k like you said, you'll end up getting what you would in private party after the tax credit.
Posted on 2/11/14 at 7:18 pm to ljd4662
quote:
you need to compare how much more you would get private party vs the amount you save in tax by trading in. I recently traded a car in and it was pretty much a wash
No, it wasn't a wash.
When you do it with a dealer you also get an implied warranty. If you drive the car off the lot and three days later the wheels fall off you can get your money back. Try that with a private deal.
Believe it or not a Nobel Prize winning paper ( LINK) was written on this topic. The idea is that a private seller of a used car can't credibly prove the car is working properly or otherwise offer recourse, so private sellers tend to get bad prices. This is the reason why Obamacare compels people to buy insurance or face penalties - otherwise people who are healthy would tend to pass it up.
Posted on 2/11/14 at 7:36 pm to foshizzle
Anyone who pays cash for a vehicle with these interest rates is an idiot
Posted on 2/11/14 at 7:48 pm to okietiger
quote:
But if I can get within $1500-2000 of the private party value listed on Kelley Blue Book
Unless you've had dealers make offers already, you are being extremely optimistic with these estimates
I believe NADA clean trade is what most dealers use to price trade ins. That's the number you should be hoping for.
Posted on 2/11/14 at 8:36 pm to Croacka
Damn why is NADA so much lower than KBB? It's also dumb that you can't add most of the options on the NADA website like you can NADA. Very weird.
Posted on 2/11/14 at 8:46 pm to okietiger
quote:
It's also dumb that you can't add most of options
Adding options falsely inflates the book value. There's often a substantial difference between book value and market value.
Posted on 2/11/14 at 9:09 pm to okietiger
I haven't used NADA much, I've just heard dealers and other insiders mention it as what the dealers usually use to appraise vehicles
This post was edited on 2/11/14 at 9:10 pm
Posted on 2/11/14 at 9:15 pm to Croacka
Most dealers will look at the avg auction price of a vehicle over the last few months to determine a trade value, we don't have access to that info
Posted on 2/11/14 at 10:34 pm to Croacka
Well if this dealer offers me $17k (NADA value) for a truck that should sell private party at $24k, I will literally do this in the dealership:
This post was edited on 2/11/14 at 10:35 pm
Posted on 2/11/14 at 11:06 pm to okietiger
I traded my vehicle in at ford a couple months back. They were 1,000 off of KBB private party, eventually. I was satisfied. It was one of the hardest parts of the deal though. They low balled at me first, then had to come back twice. The salesman literally told me "write the number you want for your car and I'll make it happen." I wrote the number and before he could even turn to walk to his manager a new write up was in his hand with the number I wanted. The games that are played at a dealership are ridiculous.
ETA: My trade is wasn't close to 25k though.
ETA: My trade is wasn't close to 25k though.
This post was edited on 2/11/14 at 11:07 pm
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