Should I Trade In My Car or Sell It Privately?

Are you ready to get a new car? You usually have two options with regard to your current car: trade it in and use it as credit toward your new car or sell it privately. Selling your car privately does not necessarily mean writing “4 Sale” and your phone number in soap on your car windshield, but it does have its advantages over trading in. Trading your car in, however, can be more stable and a lot easier. Let’s explore the opportunities that both will present when trying to make a decision.

Trading in Your Car

Dealerships are always more than willing to take in your old car, partly because they can sell it for more than they pay you for it. Because of this, they make the process much easier on you in order to encourage you to trade in your car. The dealership will determine the trade-in value of your car and offer you a price that they will deduct from the cost of the new car. This price will be lower than what you could get selling privately, but it will allow you to avoid the hassles of selling your car privately. Selling you car privately can make you liable for future problems with the car; this is not the case when you trade in your car. Trading your car in gives you a tax advantage as well–if you get a $10,000 credit on a $30,000 car, you are only paying taxes on the $20,000 difference.

Selling Your Car Privately

Selling privately means one thing, more money. You are going to want to have your car in good condition, so it could cost you some extra money to repair your car to make it more appealing. You are going to have to get an assessment of your car then start to market it. You might consider putting it in the classifieds, using a service, or putting up a for-sale sign in your car window. Once you sell, you will have to transfer the title and registration to the new owner. If your car has minimal value and you have difficulty selling it, you could also donate it to charity and get some tax benefits. Overall, it is easier to trade in your car at the dealership; the convenience and the tax breaks make it a better option than privately selling you car.

What Works Best For You

So if you want to skip the hassles, then trading in your car is a good option. It allows you to get the process over with in a timely fashion. You may not get the best deal possible, but if you do not want to be stuck with a car you do not use for an extended period, this is probably what you want to do. If you want to get the best deal you can, then look into selling it privately. It may take you longer to sell it, and there is a slight chance you would have to trade it in eventually. But if you want to maximize your car’s value, then selling it privately is the best route for you.