Trade-Ins

Read this tip to make your life smarter, better, faster and wiser. LifeTips is the place to go when you need to know about Auto Loan Math and other Auto Loans topics.

What should I do to prepare to trade-in my current car?

Trade-Ins

If you intend to trade in your current car when you make your next car purchase, you need to do a little research not only on the car you intend on buying, but also on the car you intend on trading in. If you do not owe any money on the car you are trading in, then all you need to do is to conduct a quick search to find out how much your car is worth. This way, you will not accept a trade-in offer from the dealership which is too low for the value of the trade-in.

If you do still owe money on the car, you should do the same search to find out the value of the car, but then you should also call your current auto finance company to find out exactly how much more money you owe on the loan. If the amount you owe is much less than the trade-in value, then there should be no problem with the trade-in. On the other hand, if you owe more money than the car is worth, you will run into the situation of having negative equity on the car.

Although this is not a big issue with dealerships – they simply tack the additional money onto the new loan – you will need to be aware of the additional money needed on your next car loan so you can calculate your future car loan payments. If you have an enormous amount of negative equity versus the trade-in value, you may want to attempt to sell the car yourself instead of trading it in; the trade-in amount is almost nearly never as much as the full resale value.

   

Comments

Nobody has commented on this tip yet. Be the first.



Name:


URL: (optional)


Comment:


Not finding the advice and tips you need on this Auto Loans Tip Site? Request a Tip Now!


Guru Spotlight
Sherril Steele-Carlin