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Don't Lose Money Selling Your Car

Used car prices are at record highs. That’s not great news if you’re shopping for a used car, but if you want to sell, your car might be more valuable due to short supply.

The nuclear and natural disasters in Japan caused decreased new car inventory, which increased demand for used cars, but Melanie Kovach, general manager of the private seller group at Autotrader.com, says that other factors are at play. “Japan has kind of exacerbated supply issues,” Kovach says. Americans are generally holding onto their cars longer, which combined with less attractive financing, has increased demand because fewer used cars have been on the market, she added.

What’s my used car worth?

Currently, demand is generally for smaller cars or what Kovach calls “non-special, average cars”, but hybrids are also becoming increasingly valuable due to high gas prices.

Kelley Blue Book provides consumers with an idea of fair prices for used and new cars, but it’s important to know what prices are like in your area. Kovach says that the “current market is above the traditional values. Kelley Blue Book is a great tool, but search in your market to see what cars are on sale for.” If you’re considering selling or trading your car, Kovach says, “You’ll get thousands more by selling [your car] yourself than by trading it in at a dealer.”

When dealers take your car in as a trade, they need to make a profit to sustain their business. We used Kelley Blue Book to illustrate how much money you can save by selling your car privately rather than trading it. The examples used are for prices in the Washington, D.C. area. These prices are for cars in good condition that were built in 2006, have an automatic transmission and 60,000 miles on the odometer.

Using these values, you could earn at least $1,510 more by selling your car privately rather than trading it, which is money you can use as a down payment on your next car. Granted, if you decide to sell your car yourself, there are some downsides. Advertising your car, interacting with buyers and gathering the necessary paperwork to complete the sale takes time and patience that isn’t required when you trade it in.

Make/Model

Type

Private Party Value

Trade-In Value

Difference

Mercedes SLK350

Convertible

$22,565

$20,600

$1,965

Acura MDX Sport 4WD

Midsize SUV

$18,775

$16,775

$2,000

Toyota Prius

Midsize Hybrid, Hatchback

$16,835

$15,125

$1,710

Nissan Frontier King Cab SE 2WD

Compact Pickup

$12,210

$10,275

$1,935

Ford Focus SE Sedan

Compact Sedan

$7,810

$6,300

$1,510

Make a quick, profitable used car sale

“Think like a dealer. Merchandise your car in order to get the most money,” says Kovach, who also encourages sellers to advertise. “People who advertise their cars generally get about 15 percent more than those that don’t.” It’s important to expose your car to the most buyers, and to represent it accurately. Here are some tips that will help your sale go smoothly.

1. Price your car accordingly

Go online and research what cars like yours are currently selling for. A steep price tag can keep you from selling your car quickly, but a price that’s too low might deter buyers as well. Kovach says that when a car is priced too low, buyers will wonder what’s wrong with it. If you’re selling your car for less than the competition because of an accident or needed repairs, provide those details in your vehicle description.

2. Bring back that new car smell

Buyers will think that a clean, shiny car is more attractive than one that hasn’t been washed in a year, so it’s time for a thorough cleaning inside and out. If you don’t want to clean it yourself, take it to a detailer so that it looks as attractive as possible.

If your car has small issues such as burnt-out light bulbs or fluids that need topped off under the hood, fix these small problems. Buyers will appreciate that your car has been properly maintained, and won’t be able to point out these issues when they negotiate the price.

3. Take photos

A picture is worth a thousand words, and good photos will help potential buyers decide whether or not to contact you about your car. Take pictures of the interior and exterior, as well as shots of the tires, trunk and odometer. If your car has problem areas, don’t exclude them just because they aren’t glamour shots. “Disclose problems because you don’t want to waste your time or theirs,” says Kovach.

4. Provide a detailed description

Cover the basics about your car, such as year, make, model and mileage, but also highlight anything that makes it stand out. Information about your vehicle’s options, as well as maintenance records and recent repairs, will give buyers a clearer image of what to expect.

Have you bought new tires or upgraded the stereo? Make it known in your vehicle description. Are you the original owner? Is your car garage-kept or accident-free? Answering ‘yes’ to these questions will attract buyers looking for a car or truck with a clean vehicle history.

Ultimately, your car will sell when you and the buyer agree on a price, but by following these steps, your car will be better-marketed to used car shoppers. As a result, you’ll likely have a quicker sale and walk away with more money in your pocket.