Filed under: car buying, car buying advice, car dealer, north jersey | Tags: best time to trade car in, car trade in value, trade value
So it’s prime car-buying season, and you’re thinking it might be time to move up to a bigger and better vehicle… but what about all that money you still owe on your current car loan?
Ideally, you want to be at or near the point of having equity in your vehicle. This is the point where the value of your vehicle is higher than the amount you still owe on it, which means you should be able to get out of the car without any financial penalty (and in some cases, some extra cash in your pocket).
So how do you find out where that magical point of equity is?
Well, your monthly invoices from your auto loan bank should display the payoff amount somewhere on the bill, so that’s the amount that your car’s value needs to cover in order to be in equity.
As far as your vehicle’s current value, there are tools online that will approximate your car’s worth, such as the popular consumer tool Kelley Blue Book… though it should be noted that these figures are often a bit too generous, and that’s assuming that you input the correct information.
Automotive dealers on the east coast estimate used car values using Galves, which provides average values for vehicles sold at used car auctions around the country. This is a more accurate representation of what your trade-in is worth.
But the most accurate value you can get from your trade-in comes from visiting the dealership and having the Used Car Manager appraise the car. When the Used Car Manager can see and touch your vehicle, he or she can tell you exactly what you can expect to get for your trade.
If your car is appraised at a value higher than what you owe on it, then you’re free to get out of that old thing and into a brand new vehicle… And of course, car dealers are happy to sell you that brand new vehicle. So don’t be bashful about taking your car in to a dealer to have it appraised; we’re happy to place a value on your car, and if it means selling you a new one, we’re usually willing to put even more value on your trade-in.
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