A trade-in or down payment can take a large chunk off the amount of car loan you need to drive the car you want.
Trade-ins are a convenient way to offload your old car and take money off the price of the new one. A significant influence over how much your current car might be worth is depreciation. This is the measure of how much value the car has lost since you bought it.
Many aspects of depreciation are out of your control but you can influence how much your trade-in might be worth when it comes time to apply for a new car loan.
When buying your new car, bear in mind that mainstream colours sell best. You may love the idea of an exotic colour to stand out from the crowd but you will have limited resale options and it may be valued lower than a mainstream colour.
This obviously doesn’t include classics or customs but for the rest of us, sensible colours are worth more.
Watch your mileage
The more miles your car has on the clock, the lower its trade-in value will be. This is because value is tied to engine and transmission wear and tear and the likelihood that parts have an increased risk of failure or need of replacement on higher mileage cars.
If you can keep mileage sensible without impacting your lifestyle, your car will be worth more as a result.
A complete service history is worth real money when it comes time to trade in. A service history shows you have taken care of your car and had parts changed when necessary.
This shows the dealer or buyer that you have taken care of your car and it likely has a lower chance of catastrophic failure.
Avoid modifying the car
Some modifications add value, such as reversing cameras, GPS, infotainment and security systems. Most modifications lower the value. Especially if those modifications increase the power, add stress to the engine or makes it drive differently.
Body modifications such as body kits, spoilers, custom paint jobs and vinyl wraps can also lower the value. They can also increase the value if you sell to an enthusiast but that won’t work for a trade-in.
Take care of what’s yours
Keeping your car in good condition, addressing scratches, chips and damage quickly and alloy wheel damage not only keeps your car looking better for longer but helps it hold its value too.
Anything a dealership has to do to prepare the car for resale will be costed and deducted from the trade-in value. The more you do yourself ahead of appraisal, the higher the offer you’ll get.