Should You Trade Your Car in at the Dealer or Sell it Yourself?

You just came home from the auto show with a case of “new car fever”. After walking what seemed like miles of aisles, the smell of new leather and flashy models in revealing outfits worked it’s magic and you’ve convinced yourself you deserve a new car. But what do you do with your trusty 2005 Toyota Camry with 72,000 miles on it? The easiest thing to do is just trade it in at the new car dealer, but there is a price to be paid for convenience. Car dealers pay “wholesale value” on trades and collect “retail value” when they sell that same car on their used car lot, the difference can be significant. A quick online search says wholesale value on your car is around $7,620, but retail value is $9,620. If you retailed the car yourself that $2000 difference could pay for a well deserved vacation in a warm place in chilly February! That incentive alone has convinced you that selling the car yourself is worth the time and effort.

You’ll want to start by having the car professionally detailed, your local car wash will know someone in the area that provides that service. What these guys and gals do to an older vehicle is nothing short of amazing. Don’t skimp here, get their best appearance package which will normally run under $200. That will include an under hood cleaning, buffing of the cars exterior and a through interior scrubbing. But I must warn you, when you see that old friend buffed and polished you may have second thoughts about getting that new car!

Now that the car is cleaned, we need to find a buyer. Start by passing the word to friends and co-workers that you’ve got a real cream puff Camry for sale, priced under $10,000. With new car prices skyrocketing just about everyone knows someone in the market for a clean used car. I don’t recommend selling to relatives, they’ll want you to drop the price or worse yet, ask you to accept payments over time.

No buyer found among friends and co-workers? Time to move on to phase two, offering it to the general public. Craigslist offers a fast, convenient, and free way to reach thousands of potential buyers. I’ve bought and sold several cars on the site but certain safeguards must be taken. Never have anyone come to your home, offer to meet them at a public place such as a Starbucks or Subway restaurant. Most will want to take a test drive and I recommend you have a friend follow you in their car while you ride with the perspective buyer. Never allow that person to take the car out by themselves, there’s a good chance you’ll never see it again or they’ll bring it back overheated and smoking after recreating the chase scene out of the movie “Bullitt”. I once let an elderly couple take an Oldsmobile station wagon I had for sale out for a test drive by themselves. After 45 minutes they finally returned and confessed they had the car up to 80 mph on the expressway, burning a quarter tank of gas in the process. To make matters worse they didn’t buy the car, claiming it was way to big for them. Gee, couldn’t they have determined that before taking it out for a ride?

If your car is clean and priced right it shouldn’t take long to sell but make sure you know your State’s laws regarding title transfer and sales tax due on a sale. A quick call to your local Department of Motor Vehicles will answer all of your questions.

Sure, the whole process can be time consuming and a hassle, but those memories will quickly fade as you lay on that warm beach sipping an umbrella drink, paid for by the profit on the sale!