Is trading a vehicle in really all that stupid?

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Good friend told me never trade-in as you are always leaving thousands on the table.

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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

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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

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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.

Fords current rebates include 1500 trade assist


If you choose not to trade in, you will likely lose 1500 of the stated rebates also

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I'd probably get $24k private party and $21-22.5k for trade-in according to KBB.

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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.

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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

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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.

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But if I can get within $1500-2000 of the private party value listed on Kelley Blue Book

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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.

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It's also dumb that you can't add most of options

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Adding options falsely inflates the book value. There's often a substantial difference between book value and market value.

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

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.