QuestionI'm in the market to buy a new(er) car. I've got my eye on a couple of 2013 models and a 2014 model at the local carmax. I'm still in the scouting process right now and I mainly have some questions about my trade in.
I have a 2006 Hyundai Tuscon. It's got over 174 thousand miles. It's just gotten out of the body shop because someone keyed it up and tried to break in a couple months ago. Mechanically I've had very few problems with it. My memory it's only been in the shop once because of mechanical problems. There was one AC problem last summer. It's also been in the shop for stuff like brake jobs, front end alignment, etc. I've done a couple aftermarket things to it - a new radio and a Satellite radio receiver. It needs a couple cosmetic fixes like the headlight lenses are foggy, the armrest broke and the door handle for my drivers door broke. But other than that it's solid.
Here are my questions:
1. Does the new radio/sirius receiver help my trade in value?
2. Would fixing the things like my armrest help my value at all? Or could it cost more money than it's worth to me?
3. I want my trade in value to be top notch because my credit isn't in great shape and I don't want to get raked over the coals financing. I also will soon be getting some money that I can put down on a new vehicle. Is my thinking correct here or do you have any other advice to offer?
I know that I'm asking a lot here but I want to make sure I'm on the right path before I lock myself into something for the next 4-5 years of my life.
AnswerPlease accept my apologies I had no idea this was sitting in my queue.
Let's get to your questions but first let me restate my policy on trade-ins when purchasing a new vehicle. My policy can be boiled down into three words… "Don't do it". Especially when you have a vehicle like yours that is all paid off. The only advice I can give you regarding your trade in is sell it yourself on craigslist and put another $1,000 to $2000 in your pocket. Handing the dealer the keys and title to your paid for trade only does one thing; it immediately gets turned into gross profit for the dealership. Without a trade you are in a position to negotiate only on the price of their car with nothing else confusing the negotiations; like the value of your trade in.
Now to your questions:
1. Does the new radio/sirius receiver help my trade in value?
Yes it helps your trade-in but only to the tune of $25-$50
2. Would fixing the things like my armrest help my value at all? Or could it cost more money than it's worth to me?
I would fix the armrest for sure because even though it seems like a minor thing it will impact the appraisers overall impression your vehicle in a very negative way and make it look like it wasn't cared for very well.
3. I want my trade in value to be top notch because my credit isn't in great shape and I don't want to get raked over the coals financing. I also will soon be getting some money that I can put down on a new vehicle.
Here is what I would do...if you have bruised credit (depending on how bruised...repos? Bankruptcy?or just late payments and collections? Any idea what your score is? if not go to creditkarma and check it out). Do you have any good auto credit history ..preferably your last car loan? Even if I had a this million dollars in the bank I would only offer to put 500-1000 dollars down (depending upon the price of the car you are after) That forces the dealer to shave down the price to structure up a buyable deal. (LTV). Your current car has a wholesale book value of approx $4,027 (assuming its a GLS and a 4x2...if its a 4x4 add another few hundred bucks) Your car can be bought at auction for about $1,000.00 below wholesale book or approx $3,000.00 and if I took it in on trade I would carry the car on my books with a value of $1,800-$3,000 regardless of what I show you for it as a trade in value. Remember; ...everything over this amount that you are given is a discount to the price. On the other hand ...You can sell this car on craigslist for mid book which is approximately $4,500.00 and if you want to sell it quick for $3,995.00 (and hold firm or discount no more than $200.00 when you sell it). The best way to get full value for your car on Craigslist is to have it detailed with special attention being paid to having the guy buff ot out to a high gloss finish ...seriously first impressions are the most lasting and your car should be waxed and standing tall. Whatever you do don't put $3,000.00 down out of your own pocket no matter what they tell you ... if they say they can't get your deal approved with less than that then tell them to show you some cars they did a better job of buying because they are obviously buried in the one they have you landed on.
4) is your thinking correct? Your thinking is mostly correct because at least you're giving it some thought before you actually show up and make an emotional purchase like most people wear your thinking jumps the shark is with regards to your trade-in should never trade a car in you should never negotiate car deal while you're sitting at the dealership staring out the window at it. You want to buy this next car without feeling like you just got screwed. Send some additional info on your credit to my personal email address roadloans@gmail.com and the city and state you live in and I will give you some banks that will preapprove you regardless of your credit history in your area. That will take away another way they can beat you and if you want I can hold your hand through the entire process...I usually have 2-3 people I am doing this for all the time but currently have no one....Whatever you decide when you get the survey they send you at the end if you can't give me all 10's then keep asking questions until you can ... it's my only compensation for the time I volunteer here.
Thanks
Roger The Car Guy
