If you are ready to upgrade your car, a likely first step will be trying to decipher how much your old car is worth. Several different factors determine the value of your car. Your automobile is going to probably be worth more if you sell it outright than if you trade it in. But when you take it to a dealership, you don’t have to worry about all the hassles involved in a private sale. Additionally, selling to a dealership may help you get best used cars deals and better financing options, or be able to afford that new car you have your eye on. In general, there are specific formulas in place to determine how much your old car is worth.
Car dealerships and apps or websites (like Edmunds) use standard formulas to determine the value of a used car. The problem is that things like condition and other specifications can sometimes be in the eye of the beholder. Setting the right price can make the difference between getting all you should for your used car, or having it sit waiting for months while the car devalues.
The different categories that are used to value a used car are:
Year, make and model
In general, the newer the model is, the more it’s worth — unless, of course, it scores lower in other categories. Just because you have a newer car, that does not make it more valuable if you have damage, fewer options or higher mileage. The first thing to consider may be the type of car that you are trying to sell. But the year and model are only two things that are used in the equation.
Style and upgrades
When the car was purchased new, even if not by you, there may have been several options and upgrades available. Things like trim, car mats or type of material used for the interior are all upgrades that affect the price of the car both at the time of purchase and over time. Other features that can be in this category are things like whether it is four-door versus two and the type of engine it carries.
To best decide how much your car is worth, you will need to know the specifics of the engine and transmission, such as if it has all-wheel drive. These are all factors that will affect the worth of the car. Upgrades such as navigation systems, leather, climate control options in the back seats and even a sun- or moon-roof are all things that can factor into the value. Knowing what you have is necessary to know how much it is worth.
If you aren’t sure which options or upgrades your car has, many of the websites and apps that you can use to determine the cost will go through a list of available options for your car. Sit in the car, bring the owner’s manual, or take stock while in it to answer the questions for a realistic value.
One of the most difficult decisions to make, is what type of “condition” your car is in. Just like any of your valuables, people tend to overestimate how good of a shape their car is in. Don’t discount those little things in the side, the burn hole in the interior, or the general overall condition of the inside. You may fool yourself into thinking it is in excellent shape, but you won’t be able to fool anyone who is considering buying it used.
The condition is not just about how many miles it has, whether it has unrepaired damage from an accident, or if it is older than dirt. Everything that affects the car’s appearance will affect the price. If you are a smoker, then that will likely have a bearing. If you have kids, that definitely will have a bearing too. Make sure to be realistic with your own estimation to come up with the best value for your car.
Overall, you are probably going to get the most money for your car if you sell it privately, but that doesn’t come without its own hurdles. Selling your car on your own will often take longer, and you must be available to show the car and have the time to sit and wait for it to sell. Weigh the pros and cons of selling it yourself versus using it for a trade-in to decide if the potential extra couple hundred dollars is worth it.