When Is the Best Time to Trade in a Car?
If you are looking to trade in a car, you’ll want to know the best possible way of optimizing your sale. Trading in a car is a decision that almost everyone faces at some point and involves a number of factors. One thing to remember is that a new car begins to depreciate in its value from the very moment you drive it off the dealer’s lot. The loss can be up to 25 percent of the full value in the first year alone although the depreciation level drops after this period. However, it will rise again once the vehicle has more than 50,000 miles on the odometer.
You can determine the trade-in value of your vehicle in several ways. The simplest is to check the Kelley Blue Book. Just search for your vehicle in the book, locate the vehicle condition and find the appropriate mileage. This will give you what the Blue Book assesses to be true resale value of your car.
This is all well and good in terms of providing a guide but what is more important is the actual price a dealer will be prepared to pay when you trade in. To come up with a realistic figure, visit several local dealerships and ask the used car manager what price he'll give you for your vehicle if you trade in with them.
How much equity do you have in your car? It can be an important factor during the trade in process. If you are at the stage where you do not owe too much money on your car, it can be a good time to trade in right away as the price you will receive will give you extra money to use as a down payment on a new model after you pay off the outstanding balance on the old car.
As cars age, they tend develop mechanical and cosmetic problems. After about 50,000 miles, you will probably notice your repair bills increasing and the amount of repairs growing. Often they will be minor problems, but a continual stream of bills can soon add up.
Keep an eye on these issues, especially if you still have car payments outstanding. Many drivers find that their old model is "nickel and diming" them to death as the repair expenses mount. At this point, you should definitely consider cutting your losses and trading in the vehicle on something newer. In the long run, you will definitely end up saving money.
Time of Year
A good time of year to trade in a car is just before the new models of car come out. This is when the dealers want to clear their lots prior to receiving the new cars and will offer the greatest discounts on unsold models. You will be in a strong bargaining position and can get a better deal on your trade-in if you want to purchase a new car.
Age of Car
You will get the best price when you trade in a car if you trade it before the odometer turns over on 50,000 miles. At this point, it should still be operating well and not costing too much in terms repairs. Ideally, trade in when the odometer reads between 30,000 and 40,000 miles for the optimum price.
Armed with the knowledge of when the best time to trade in a car, it is sure to be a financial win for you!