It's a bittersweet farewell indeed, but, every now and then, it’s just time to get a new car. The question is; what to do with the old one? You could be looking for an upgrade of the model you’ve been using, or sometimes a vehicle becomes too expensive to maintain and you’d prefer a downgrade. Insurance premiums could go up as the cost of sourcing parts becomes more expensive, and instalments become too costly. Perhaps your warranty is about to run out, or maybe your car manufacturer is set to close their doors and ship out of South Africa, discontinuing the car you’ve been driving. These are common factors, and are worth taking into consideration before deciding on how you'd like to go about selling your existing vehicle.
There are generally two options when it comes to getting rid of your old car. You could trade it in to the dealer, which will give you a nice down payment on your next car, or you could sell it yourself.
How to decide, and when is the right time to make that leap? After all, making the right decision could save you a large sum of money.
First thing's first; you need to know the true value of your vehicle.
A well-looked-after car is a desirable car. If you’ve managed to keep receipts of any repair work with your service history book, you’re already doing well. It’s worth spending some money to have any bumps or dents repaired, as well as keeping it clean. This will increase the value of the vehicle.
If you’re happy with the state of the car, you could do your own research by keeping an eye on car retail websites and seeing what your car could be selling for. Speak to a few dealerships and check what the average price is. If yours has any special features, such as leather seats, then these could also increase the value.
Remember, you don’t have to sell your vehicle at the same dealership where you’ll be buying a new one.
Let's say you own a Peugeot, though. Generally, you’ll get more money if you sell a Peugeot to the Peugeot dealership. You could then take that money over to wherever you’d like.
If you’re planning on trading in, negotiate on the price of the new car with a dealer before even mentioning that you’d like to trade in. Also, it helps to do this toward the end of the month. Salesmen have a target to hit, and that’s your bargaining power.
Cars that are still under warranty will fetch a higher price. Generally, the value of your vehicle depreciates at a rate of 15% - 20% per year. So, by the fifth year your vehicle could be worth half of what you originally paid for it.
Certain models, such as the VW Polo or the Toyota Corolla, continue to be popular and hold their value for much longer.
Once your warranty runs out, the value of your car will plummet. Likewise, if the manufacturer has ceased distribution to whichever country you live in, you’re going to have trouble acquiring parts or performing proper maintenance, etc.
Luckily, the first option you have is usually incredibly easy. To trade your car in, you'll need to take it in to the dealer, who will make you an offer based on a number of factors. These could be the age of the car, the model, the mileage, the condition, or the make. You then put that money toward buying a new car, or take the cash and run.
Usually, you don’t need to deal with any paperwork because the dealer will take care of it all for you. Drive in with your old car and drive out with your new one.
Seems pretty easy, right? Of course, the downside is that you could get a lot more money if you were to sell your car privately.
Typically, you could get 10% - 15% more money if you sell your car privately. Unfortunately, it’s also a lot riskier, and you'll have to put up with a number of inconveniences. Not only will you have to field a bunch of inquiring phone calls, but you’ll also have to make yourself available according to the schedules of prospective buyers.
Scam artists, in particular, pose a big threat. You’ll also have to put yourself at risk of hijacking and robbery by allowing complete strangers to test drive the vehicle. And let’s not even get started on the paperwork. Road worthy tests, the vehicle’s full service and accident history, change of ownership, these cost money and time.
However, if you know your car and you’ve had experience in selling cars in the past, these shouldn’t cause too much of a headache for you.
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