Know the Value of Your Existing Car
Whether you decide to sell your car or trade-in the car, you need to pay-off the loan. This is the reason why you first need to know the current pay-off amount and get an idea of the highest trade-in value. If you are not aware of the amount to be paid off, you can check out with the leading auto value websites. Here you will find any one of the two situations – either the trade-in value is more than what you owe (which is better) or the trade-in value is lower than what you owe (which increases the complexities).
Next, visit the dealers from where you want to buy your new car and offer your existing car for a trade-in. Once the dealer has appraised your car and offered an amount, see whether it is more than the pay-off amount or not. If it isn’t, make sure you negotiate the value further. Make sure the difference between the trade-in value and the purchase price of the new car is the least.
If you are satisfied with the offered trade-in value, you can proceed with the rest of the formalities. The amount you now owe to the dealer is the difference in the price (of the trade-in amount and new car purchase price) plus the pay-off amount and any other taxes or charges that are applicable.
Now if you apply for a fresh auto loan, you will owe the above money minus the down payment amount (you pay to the bank or any the financial institution). If the trade-in value is more than the pay-off amount on the previous loan, the difference amount will work as the down payment for the new loan. If you are satisfied with the numbers, you can proceed with the deal. Otherwise, you can check out with other dealers as well.
In most cases, a trade-in is the most suitable option, if you owe money on your existing car. You should avoid carrying forward any old debt, since it will increase the financial burdens further. So make the right decision while trading-in or selling off your old car. Get your trade value.