For most Americans, a car is a necessity. It’s how you get to work, school, social activities and everything else you do. While it can be fun to think about buying a new car, the process of trading in an old one can be tiresome.
The transaction of buying one car turns into two transactions, and you are left wondering whether either of the deals you agreed to is a good one.
This is what to keep in mind when you are trading in your vehicle for your next one.
Why would they give a low offer in the first place?
The answer here is simple. The less they offer for your trade, the more profit the dealer has after selling it. In most cases, the car you are trading in is not going to the “used” section of the lot you are visiting. It is probably going to an auction. In short, your car being sold at auction means the dealer is not going to be able to sell your car for much money.
How do I know the offer was low?
The short answer is that the offer will always be low. If it seems “too good to be true,” keep an eye on the price of the vehicle you are purchasing. The dealer may be making up for a high offer in another place.
Keep in mind; typically, you will be far better off selling the car on your own. While the process is more labor-intensive, you will usually end up better off.
Before you go shopping, do your homework. Look at both estimator sites and used car sites to see what range you should be able to expect for an offer on your vehicle. You should go into the dealership with a good idea of what your car is worth.
The initial offer will almost always be low. Giving a low offer is key to negotiating. The dealer knows that if they give you an insultingly low offer, you will be happy with any higher offer from there; even if the next offer is just as insulting.
How can I avoid a low offer?
If you are trading in your vehicle, there are ways to avoid getting a lowball offer. Consider the following when talking to a dealer about your offer:
- Walk away. The most important concept to remember here is the power you have in walking away. Remember, the dealer you are talking to has a sales quota to make and has more to lose than you do if you walk away.
- Keep your trade separate. Dealers like to keep everything in the transaction together. Keeping it all together makes it easier to hide a lowball trade offer.
- Shop around. Don’t just shop around for the best price on your new car, shop around for the best deal on your trade, too. Do not be afraid to tell one dealer that you got a better offer from another place.