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Tips on ensuring a fair price when trading in your car

Tips on ensuring a fair price when trading in your car

Lindiwe, a young career orientated Charted Accountant who graduated top of her class. Lindiwe has been working for a well-known accounting firm for the past three years and is climbing her way up the corporate ladder. A very detailed driven young lady whose tendency is to do thorough research – this definitely assisted her when trading in her vehicle.

 

 

Having recently been promoted I was able to trade-in my “first” car at last and upgrade to something a little more stylish. This was incredibly exciting – but rather daunting at the same time.

 

I wasn’t really sure where to start, but I knew I had to sell my old car first. It seemed like I would get more money for it if I sold it privately, so I thought that must be the obvious thing to do. How would I advertise it though, and how much could I ask for it?  Initially that seemed to be the trickiest part, but as I was sitting in the canteen at work looking through other peoples “Car for sale” adverts on various platforms, a colleague sat next to me and asked if I was buying a car.

 

 

I told him that I was wanting to upgrade, but first I needed to sell my old car and I was trying to figure out how to sell it and get the best price for it.   Evan advised me to rather trade my old vehicle in and pointed out some valuable tips, that I honestly had not even thought of. 

 

 

“Although you’ll probably get more money selling your car privately, don’t forget that this comes with a lot of hassles and safety risks, such as hijacking or even car theft”, he advised.  He went on to say that I would have to answer a lot of phone calls and arrange test drives with complete strangers.  He then told me a story of a friend of his who had been the victim of a scam where the purchaser produced a fake proof of payment. What a nightmare!  It didn’t end there – he also told me that I would have to take my car for a roadworthy test and process all the forms such as the change of ownership myself. All of these costs add up and this process takes time. So, Evan recommended letting a dealership take the car off my hands, as this would be a much more convenient and safer option.

 

 

The very next day, I took my car to a dealer not far from the office. A very over excitable young salesman started throwing words at me - retail price, trade-in price, book value….  He came up with an offer which made me feel rather deflated.  I politely thanked him, went back to the office and thought to myself; “Umm… I need to seriously google all these strange terms…”. 

 

 

I realised that I needed to understand how a trade-in price was calculated and needed to get my head around those different terms that were thrown at me, so that I could be much more prepared when I visited the next dealer. I did my research, and this is what I found:

 

 

Retail price: This is the price of the car when someone buys it from a dealer. The selling price: trade-in price plus the dealer’s profit/mark-up. If you sell privately, you will get the retail price.

 

 

Trade-in price: This is the price that the dealer will pay you for the car. This will go towards settling your vehicle finance or you’ll receive it as cash towards another car.

 

 

Book value/’book value’: Dealers may talk of the blue book value – this is the industry-accepted dealer valuation book by TransUnion on which they will base their price.

I then realised that I needed to get a better idea as to the value of my car, so my next steps were to do my own research by keeping an eye on retail sites. Evan suggested looking at the Imperial Auto website, as he had found the articles useful and the filters ensured dodgy private sales and potential scams were filtered out. I felt comfortable doing this as I know that Imperial Auto are a reputable company.  During my search, I did and I noticed that the vehicles with special features such as a fancy sound system, leather seats and mags were able to fetch a better price. I then phoned and visited a few different Imperial Auto dealers to see what the average price was that I could get for my car.

After this exercise I felt a lot more confident and was ready to go to my chosen dealer and look at a new car and see what deal I could get as a trade-in for my old car. While I was doing my research, I found a few other handy tips, so before I went, I made sure my car was nice and clean and I took my service book with which luckily for me showed a full-service history.

 

 

I ended up at an Imperial Auto dealer, they were absolutely amazing.  They showed me various options for a new vehicle and arranged for a professional valuator to look at my old car.

 

The valuator was extremely thorough, and he talked me through the factors that would affect the price he would offer me.  This is my ‘selling my car’ checklist :

o    Popularity of vehicle make and model

o    Year of first registration

o    Mileage (an average mileage of 25,000kms per year is acceptable)

o    Vehicle condition

o    Warranty, maintenance and/or service plans are intact

o    Service history

o    Any additional accessories or non-standard specifications 

o    Exterior colour of a car may also play a role

 

 

The team from the Imperial Auto dealership offered me a price that I was very comfortable with, and they worked out an amazing deal for me on my new car too.

All that was left for me to do was provide the following (another useful ‘selling my car’ checklist) and the trade-in could go ahead:

 

o    My RSA identity document or valid driver’s licence

o    A bank finance settlement letter, to prove that my vehicle had been paid in full

o    Original NATIS (registration document) for the car if it is paid up

o    Proof of residential address

o    Service handbook to prove service history 

o    Both sets of car keys 

o    All extra items relating to my car e.g. tracking device

 

A few days later I drove my new car off the show room floor.  I was really thankful that I had done my research and was super proud to be the owner of a brand-new stylish car!  

For more tips on selling or buying a car visit: https://imperialauto.co.za/articles 

 

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