How Does Trading in a Car Work?

May 31st, 2018 by

Trading in a Car

Trading in your current vehicle instead of selling it to a private seller can offer numerous benefits. You’ll enjoy the convenience of conducting both side of the transaction — buying and selling — at the same location at the same time. You’ll also enjoy major tax benefits if you live in an area with a sales tax. Read on to learn more about the trade-in process in Maple Creek, car loan rollovers, and selling your vehicle before test driving your next vehicle.

The Car Trade-In Process

To maximize your trade-in value, you’ll want to understand the process. First, you’ll want to understand the value of your trade-in through a service like Canadian Black Book. You’ll need to understand that dealers won’t offer as much for your vehicle as a private seller in some cases, but the tax advantages outweigh the sale price. Ensure that you properly clean your vehicle, have up-to-date service records, and present the vehicle in the best possible way.

Car Loan Rollover

If you have a loan on your current vehicle, you’ll need to understand the principles of equity and value. The value of your equity — that is, what you own free-and-clear in the vehicle — will be used in the trade-in value calculation. If you owe more on your vehicle than it is worth, then you will have an uphill battle where the dealer will likely tack on the negative equity portion as san additional amount added to the new loan.

Selling Your Car

If you decide to sell your car to a private buyer instead of trading in your existing vehicle, then there are a few factors you should understand before you dive in. First, you should ensure that you have positioned your vehicle as best as possible — that means cleaning the car, doing your market research, and finding willing buyers. You’ll want to avoid lowball offers and those who kick the tire. Finally, make sure that you can verify the safety of the transaction, especially when using listings sites like Craigslist. Soon enough, you’ll be ready to visit all the Swift Current restaurants and hot spots in your next new vehicle!

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