Trading in a car allows you to sell your current vehicle to a dealership and apply its value to your next car purchase. This is an efficient way to approach the car-buying process. Here are all the details you need to know to trade in your car and purchase a new vehicle.
Trading in a Car You Own
Image via Kia Dot Com. If you own your vehicle, the trade-in process is quick and simple at any dealership. You will receive the full value of the car that you're trading in and can easily apply it toward a down payment on your next vehicle. Trading in your car at a dealership has many benefits over selling it yourself. When you trade your vehicle in at the dealership:
The dealership handles the paperwork, so you don't have to.
You'll get an immediate offer for your vehicle, so you're not waiting to find an interested party.
You can leave your old vehicle with the dealership and drive away in a new one, so you're never without a vehicle.
Trading in a Car You Owe Money On
If you still owe money on your vehicle, trading it in is a little more complex. You'll first need to determine how much you owe on the vehicle. If you owe more than the vehicle is worth, you're considered "upside-down" on your loan. In this case, the dealership will apply the value of the car toward the balance on your loan and roll the remainder of what you owe into the loan for your next vehicle.
This makes it possible for you to trade in your vehicle and get a new one, but it means that your trade-in actually adds to your loan rather than making it smaller. It's best to avoid this situation whenever possible and attempt to pay off enough of your loan to come out on top.
If your vehicle is worth more than what you owe on your loan, the dealership will pay off your existing loan first and apply the difference toward your next vehicle. This is a better situation financially because that excess amount counts as a down payment toward your next vehicle and will reduce the amount that you have to borrow.
Working with a dealership is a great way to trade in a vehicle that you owe money on because the dealership takes over the loan and helps you get into a new car before it's paid off, which is something you can't do with a private sale.
Assessing the Value of Your Trade-In
When you trade in your vehicle at a dealership, the dealer will typically:
Inspect the vehicle.
Take the vehicle for a test drive.
Provide you with an offer.
You can get a general idea of what your vehicle is worth before you visit the dealership by doing some independent research online. Tools like Kelley Blue Book can give you an estimate of your vehicle's worth based on the make, model, features, and condition. You can also get an online trade-in estimate through a dealership like Tom Kadlec Kia.
When you're submitting information for these estimates, it's important to use accurate details regarding the current condition of your car. When in doubt, err on the side of less quality rather than greater quality.
You might also shop around and get a trade-in quote from multiple dealerships for a well-rounded idea of what you can get for your vehicle. Ultimately, it's best to trade in your car at the same dealership where you plan to get your next vehicle so you can simplify the process of selling your current vehicle and applying its value to your next vehicle purchase.
How the Trade-In Process Works
To trade in your vehicle and purchase a new one, you'll need to have the proper documents on hand. When you go to the dealership, make sure that you have your:
Driver's license.
Vehicle registration.
Vehicle title.
Proof of insurance.
All vehicle keys.
Auto loan information (if applicable).
If you checked the trade-in value of your vehicle online prior to visiting the dealership, take a printout of this information with you, or take a screenshot of it with your phone. It's handy to have detailed proof of other offers, particularly if you need to negotiate for a better trade-in price at the dealership.
Contact the dealership ahead of time to make an appointment for your trade-in. Some dealerships have a limited number of team members who appraise trade-ins, so you can expedite your experience by reserving a time slot in advance. When you arrive, the trade-in experience will typically follow these steps:
If you're thinking about trading in your vehicle, you may have some questions about the process.
Is Trading in a Car a Good Idea?
Trading in a car is a quick way to get money from your existing vehicle to apply directly to your next car purchase. This is a fast and easy way to handle the sale of your vehicle.
What Do Dealerships Do With Trade-Ins?
Dealerships typically handle trade-ins in one of two ways. They either recondition the car for sale on their lot, or they sell it to another dealer. They might sell the car wholesale to a different dealership or put it up for auction.
How Often Should You Trade in Your Car?
In general, it's best to wait and trade in your car only after you've paid off the loan. If you still owe money on your vehicle, it's only wise to trade it in if your next vehicle will lower your expenses in some way, through lower insurance premiums or better gas mileage, for example.
In the right circumstances, trading in your vehicle is a great way to get into a new car quickly. Visit our team at Tom Kadlec Kia to learn more about how to make the trade-in process work for you.
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