Factors that Determine Car Trade-In Value

July 28th, 2022 by

If you’re shopping for a new set of wheels, consider trading up. Knowing what goes into determining your car’s trade-in value can help you maximize your return. Learn seven factors that appraisers use to calculate your vehicle’s worth before you start visiting dealerships, so you’ll feel confident driving away with the highest possible offer.

What Is a Trade-In?

Trade-in refers to the common car buying process of exchanging your car for credit toward the purchase price of another vehicle. Most of the time, this transaction occurs at a dealership. However, some private party sales do include trades.

When you buy a new or used car, you want to save as much money as possible, and trading in an older vehicle is one of the best ways to lower your cost. The amount your dealer is willing to offer in exchange for your old car could be in the thousands. That figure all depends on a range of factors we’ll discuss now.

Mileage Matters

Your automobile’s odometer reading could be a green light or a red flag for potential buyers. Even if your car has always been dependable, its trade-in value will take a big hit if it has more than 100,000 miles. The average person puts between 12,000 and 15,000 miles on their car a year. If you have a long commute, you’ve probably driven your vehicle farther than most people. This added stress could cause mechanical issues you may not find on the same model with less time on the road.

Take advantage of opportunities to leave your car at home by occasionally carpooling or using public transportation. You’ll keep your mileage low, which is good for the planet too. If you’re planning a road trip, consider using a rental car instead. Your efforts could help you cash in when it’s time for a new ride.

Regular Maintenance

Regular maintenance ensures your car performs reliably for you today and will increase its trade-in value in the future. Follow your model’s manufacturer-recommended schedule for oil changes, radiator flushes, brake jobs, and other services. Always keep copies of repair and maintenance records to show your prospective buyer how well you took care of your vehicle while owning it.

Options and Amenities

Not all options are as valuable as others. Some amenities positively influence your car or truck’s trade-in value, while others have the opposite effect. Commuters want extras that help the vehicle stand out from the crowd, such as:

  • Factory-installed sunroofs.
  • High-powered engines.
  • Leather upholstery.
  • Premium wheels.

If you want to maintain your vehicle’s trade-in value, avoid adding a bunch of aftermarket accessories. Every car shopper has their own taste, and finding someone that loves those performance-based upgrades as much as you do could be challenging.

Equipment like an expensive stereo may seem like a worthwhile investment. However, you probably won’t get your money back on high-tech accessories when you trade in your car. Some performance-enhancing add-ons can even void your car’s warranty, like suspension lifts or wheel kits.

Interior Condition

How well you treat your car’s cabin also determines its trade-in value. Whether you routinely eat and drink behind the wheel, take your dog for a ride, or smoke cigarettes, these stains and odors can adversely affect the dealership’s offer — by hundreds of dollars in extreme cases. People want to buy cars that have been gently used and lovingly cared for, and piles of trash are warning signs that appraisers don’t take lightly.

Before trading in your vehicle, take an afternoon and give it a thorough cleaning, including the windows and carpet. While you don’t need to restore your car’s interior to like-new condition, any effort you put into the task could be worthwhile in the long run. Many excellent products can help you tidy it up quickly.

Body Damage

Automotive experts grade the condition of used vehicles on a four-point scale: Excellent, Good, Fair, or Poor. Most vehicles fall into the Fair category, while very few earn the top-tier rating. Of course, door dings happen to everyone, but even one small dent can drop your value a whole rating level, and your dealership’s well-trained appraisers see it all.

To preserve your car’s body and paint finish, park your car in a garage or out of the elements. This habit will help reduce the risk of scratches, chips, and fading. Before trading in your vehicle, remove all bumper stickers and wash and wax your car and use touch-up paint to cover up any minor blemishes.

Color Package

Another thing to consider that impacts the trade-in value of your used car is its color. To ensure a good return, pick an automobile in a neutral hue, like black, white, or silver. These traditional colors never go out of style. On the other hand, a limited-edition color scheme may seem like a great idea at the time, but it may end up being a hard sell when it’s time to trade for something new.

Market Conditions

The dealership will also consider your vehicle’s current market value when calculating your offer. While you don’t control every factor that goes into determining your car’s trade-in value, you can be mindful of the market. The automotive industry is just like every business with inventory. It revolves around supply and demand. That means that even if you’re selling an award-winning Camry, a dealership that doesn’t have one will likely make you a better offer than one with a dozen on its lot.

Some of the most popular used vehicles are the same models that have always captured drivers’ hearts, like the world’s best-selling car: the Corolla. Some vehicles depreciate slower than others, as well. Toyota earned its reputation for quality because models like the 2022 RAV4, Tundra, and the Sienna retain far more of their original value than the national average depreciation rate of 49.6% over five years.

So, there you have it. Classic Toyota shared these seven factors that determine a car’s trade-in value with you. So, now that you know what goes into this process, contact us or stop by our showroom. Also, feel free to use our Value Your Trade feature where you can get a quote in minutes! We’ve been your trusted Tyler, Texas, dealership since 1994 and are ready to serve you.

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