I'm just curious about the mentality of trading in a car.

I was considering doing it myself, but then when I found out how much money is lost doing a trade in I was completely and utterly put off by it. And yet I see a lot of people here mentioning trading in their cars.

Like when I checked up on the idea of trading my MS6 to get back into an RX-8, it looks like I essentially lose like 7K (including taxes) after only like 2 months of ownership. Though I really want to get back into an 8, I can't possibly justify that, so I'm kinda curious how some of you guys did.

 

I haven't traded in my car but typically cars lose 15%+ in value as soon as you take ownership. In SoCal, I would imagine that selling your MS6 might be easier then trading one in as you might find a buyer who can help you recoup most of that 7K lost.
If you sell your MS privately, you'll get more for it and then maybe pick up an 05 or 06 RX-8 and break even.

 

it depends on the car, and the deal you get. most of the time its better to sell private. a friend of mine actually sold his g35 for more than he paid for brand new after about 5 thousand miles of use on the private market. but some cars holds value pretty well and its worth for some to do the trade in. on average a car retain roughly 50% of its value in 3 years. the better value holdser like porche 911, bmw m3, g35 coupe etc usually holds in the low 60% after 3 years. the worst value retainers like kia optimas etc loose 50% in the first year alone.

 

I think there are 2 different concepts at work there. The second you buy a new car, it depreciates a good margin immediately. If you buy a 30k car and sell it used or trade it in a week later, you'd probably still take a 5k hit on it. It can never be sold as new again and, thus, will no long qualify for a new car loan apr.

Generally, the only reason to trade in is you want to get rid of the car immediately (or possibly the car has some mysterious issue with it that makes it unsellable but the dealer doesn't know about). My brother had a 626 with bad wiring. All sorts of stuff would fritz out and die. Sometimes it wouldn't start. Sometimes it was fine. He traded it in. After he parked it on the lot, it then decided to no longer start that day. Luckily the papers were signed and the dealer knew the wiring was borked. It would of been very difficult to sell it privately. I wouldn't feel right trying to sell a piece of garbage to someone. I don't know what the dealer did with it.

When I bought my 8, I emptied out my savings/checking for as big a down payment as I could swing, but I kept my other car for winter duty. It would not have traded in for much and given what I have done to it, I don't see a bidding war on it in the near future.

 

I see at least 5 of these a day. I will tell you that you will get WAY more selling it yourself. A dealership has to make sure it can make a profit on your car. That meens getting it WAY below blue book just in case they have to da any repairs.(even if your car is PERFECT, they will still hit you low) and of course they want to make as much $$$ as they can, so they hit you even lower. ALSO, Most salesmen get paid on the difference of what your car is worth and what you will take. Example; The dealership will buy your car for $20,000 and the salesman convinces you to trade it in for $17,000 . . . . .That is another $3000 in the deal that he gets commission on. So the dealership is trying to make money on you, and the salesman is trying to make money on you . . . . blah blah blah

And jedi is right. Buying a car and trying to get out of it too quickly will always hurt you. The car loses a full year of depreciation on the first day. You can never get back taxes and licensing, but if you sell it yourself, you will get a lot more than trading it in.

 

It's the same ideology behind LEASING. A person wants/needs a new car every few years or so. Actually, leasing is much more economically sound--if you're not a "Tuner." You can lease, an 8 for example, for about $275/mo with a $300-$1k deposit/down payment. Then, after two years you can either:
a) Renue the lease for a chaper montly
b) "Buy" the car outright with another loan or cash
c) Walk away clean and lease another NEW car for X years...

A lot of folks get board easily with cars and feel the "Joneses" whenever something shinnier, newer, faster, and cooler-looking comes out. Me, on the other hand, bought my 8 when my 89 (I bought it new) Civic died after 278k miles, two tranny re-builds, one engine re-build, three clutches & flywheels, etc. and I NEEDED a new car. My engine was shot....Anyhoo, newer and cooler cars inevitably come out and in 2-4-6 year incriments, same as lease terms.

To justify "Buying" is a different story. Leasing, in and of itself, is not a bad deal! You get a new ride every so often and cheaper than buying (in terms of monthly payments & down).

Thing is, I HATE monthly payments. I could own my 8 till the casket drops or I wear out its parts...there's a cat on here that traded in his used 8 for a brand new 8! And (s)he maintained the SAME monthly payments! That's cool! If I should trade-in--that's what I'm going to look to do.

2 cents.

 

I always trade in my cars. Up here, we get the tax credit on the trade so the difference between trading it in and selling privately is relatively small. But, I must admit that I never accept their first offer and usually can get the price up a bit. In any event the difference is never as big as we would like to think.

For me, I just don't have the inclination to advertise the car, show the car on evenings/weekends. Then, there are the inevitable joyrides, the "I'll think about it!", or the classic "I'll be back with the wife/husband". How about the "Let me go get my loan." .......

 

I've traded in my car for most of the above reasons. The car was in rough shape and had lots of red lights on the dash so I didn't feel comfortable selling it to someone and would probably have to have it sit and wait for a while to get a buyer that wasn't scared off by all the problems. Also I didn't have space to park another car so I needed to unload it. I took a hit but probably not that much since the car was pretty old with a ton of miles anyway. As far as leases go I agree that they are more economical as long as you don't buy the car afterwards for more than it would have cost to buy it new (including your lease payments) and as long as you don't go over your mileage. If you are a grandma that drives to church on Sunday then a lease will probably do you fine. If you drive 40 miles one way to work like I used to then the mileage charges will be more painful than having your nuts squeezed in a vice.

 

True, leases do give you a mileage allowance. But you need not be a "church-driving-grandma" to take advantage of a lease. Just estimate how much you drive and come financing time, you can arrange for X ammount of miles by paying more of course.

All in all, I prefer to buy and drive the car for all it's worth! That way, I know I've gotten every penny's worth out of the car before I have to buy again. If there is, however still some life in the car--trade. I hate lowballers, joyriders, tire kickers, penny pinchers, etc. With a trade, you only negotiate once! Granted its a dealer who'll no-doubt offer below blue book, but in any case it goes towards another car...

 

Yeah, you will loose a ton of money by trading in a car. Dealers will always give you the Black book value (what they would get at an auction). I sold my RSX Type S to a private party and got really good money. The 8 is a totally different story. Let's face it, it is one of the least desirable cars on the road now. Nobody wants it. No wonder dealers are making ridiculous offers on trades. The best offer I got for my 8 was from CarMax. The private party ******** who made offers or engaged in lengthy chat/email/PM conversations are not serious about buying the car, nor do they have the common courtesy to say that they are no longer interested or changed their mind. They just waste your time and money. I am trading-in mine as soon as I firmly decide what I want. I am getting tired of waiting and dealing with discourteous people.

 

What's so bad about the MS6 that you want to trade it right away? In any case, even if you sell it yourself you will probably take a pretty big hit trying to change cars this soon.

At this point, you might as well just wait a little while and see what happens. Maybe Mazda will announce an MS 8, or some other improvements for '08 or '09, or a production Kabura/Nagare/new RX-7, or a MS MX-5, etc...

 

A few things in trading in a car:

1) It’s easy. Trade in the old and buy the new, done.
2) Selling PP can also be a hassle. People knowing where you live and so forth can’t get financeing…
3) What are you supposed to do after you have sold yours and are looking for a new one, walk?
4) If you buy a new or used car and then try to sell yours you are paying two monthly payments.
5) What happens if you can’t sell your car? Then you have to Carmax it or try to sell it to a dealer. Then they will really stiff you since you are not buying from them.

Lastly if you trade-in a car you can be sitting on major issues or maintenance (I need 4 new tires and brake pads) on my last one which was going to cost me around $800-$1,000. I would not have sold that private party as it was.

 

Eh, nothing is that wrong with it, it's just I liked the 8 a lot better. The MS6 just feels so damn heavy and I like riding lower. I'm also a bit worried about reliability now that my MS6 occasionally has these weird moments where it makes this clicking noise when I step on the gas. If I get off the gas and get back on it, it goes away.

I would've kept my 8 (it was a lease) if it wasn't for the dealer pissing me off. Actually I wasn't going to stick with Mazda after my dealer experiences, but I was kind of in a hurry to get a new car (I was borrowing my brother's car which was about to be No Plan to Operated) and I was thinking I wanted a 4-5 seater, that was pretty fast and handled well that I could get a good deal on. After a few ideas fell through I fell on the MS6, which I do really like, but it's not an 8.

I'm thinking my best option might be waiting for the MS8, though I'm worried that the MS8 will have really really crappy gas mileage. And to be honest, the speed of the normal 8 was just dandy with me.

 

Dealers are crooks!!!!!!!!(I know I work for one)

 

Depends if you're trading in for new or used. Used is hard but new isn't too bad. A large dealer with quite a few cars will pay above blue book value (on my trade in for the 8 I got 2k above blue book for the trade in along with 5k off msrp) Trading in for a used car is where you'll take the bigger hit.

Like it or not though, if a deal is available and you do not have the time to sell privately, a trade in is the only option. The blue book today is what I payed for my 8 a year ago so I figure I can take a little hit here/there.

edit: dealers can be crooks* If you know how to work them correctly and its a supply/demand issue you can get a fair price for a car.

 

When your in a lease you can trade her in no prob. Its when your buying the dam thing that you get *** raped I was buying a 3G Eclipse car sucked big time and I knew I had to bite the bullet and got the 8 if I want a better car. Best thing ever

 

Trading in has worked for me. It all depends on the car. a Mazdaspeed 6, along with an RX8 are cars you will take a nasty hit on because there is little demand. For me, I sold my RX8, but still took a hit, and I traded in my STI for a Speed 6, and I did well. Bought STI for $29000, drove it two years, and put 28k miles on it with nothing but oil changes needed, and got $23000 trade in. Sure I could have sold it for $25000, but I saved $1380 on sales tax by trading it in, and avoided the hassle of selling it, and people calling and haggling me. It doesn't always work, but you have to remember, that anytime you start replacing cars, especially new ones, you are spending a lot and losing money either way.

For me, I don't mind. It's worth the money for me to experience the newest cars, but I pick and choose how I do it wisely, so I don't spend more then I am already.

 

As much KY as you need...

 

I tried to sell my car but found it hard to sell. 03 Passat stick. Since it was a manual and a Volkswagon, it would sell to a particular buyer. The car is still sitting on the dealers lot. Plus I got the tax break by trading and I got a decent price for the trade since I haggled.

 

Just to add my $0.02. I had finally decided to replace my 98 A4 (only owner) with my RX-8 right before thanksgiving. My A4 was in excellent shape, mechanically and cosmetically, and I had extra stuff like a set of summer wheels and tires that I figured wouldn't have any value on trade in. So, I put the car up for sale for $9500 - trade in value for a normal car was $5500, but my car had new brakes, recent timing belt, fresh rubber, etc etc, iow, needs little work. So, I went looking at cars, and its the end of the month, winter coming, I figure the guys are ready to deal. To my surprise, they were.

So, it depends how you figure it, but here's why I ended up trading in my car instead of selling it - and I had several inquiries after a week, with not too much advertising.

06 Copper red Shinka - price: $27,500 after rebates.
tradein on my 98 A4 79,500 mi : $71xx.

So, my car plus $20,500, then the extra stuff that you pay to MA.

Could I have gotten a little more cash for my A4, yeah, I think so, but at the most I guess I could have gotten $9k, then I pay tax on a $27k vehicle instead of a $20k vehicle, and I have no headaches. The biggest thing is I don't have to wait - and maybe my car (the RX-8) gets sold and I am stuck with something I dont want. Not worth the potential MAYBE $2000, and maybe that's only $1000.

Who knows. Every situation is different. But my car was 8.5 yrs old. I sold it to a dealer who is going to find a customer who values the condition of the car and the complete service records, and they took it off my hands with no problems.

They were nice enough to me that I wish them well selling that car - they didnt get much from me buying the 8, and they had to swap a CX-7 to get it from another dealer, so they may well have sacrificed a bit of profit on the 7 for the 8.

All in all, I got a good deal, and I really like the guys I bought from. I'm glad I didnt roll the dice and wait for a better deal, because I might not have an 8 (cheaply =) for another year.

Woohoo!

Check engine light after 20 hrs ownership too!! (think its the gas cap LOL)

 

trading a car that you still owe on you will always end up loosing.
And trading a car that's been payed for, you will never get what its worth.

economically the most sense is to keep a car as long as you can. The only benefit to trading in a car is that it takes the hassle out of selling it before you buy the next one.

(sometimes youre just too fed up with a particular car after a bad experience with it and then you feel the hit on the trade is worth it)

 

^So true

 

I always trade my car and here's why:

*I usually have a small amount of "equity" in it so I don't end up upside down and adding to the payoff on the next one. I don't trade until I can show a small amount of equity.

*Selling a car can take forever.

*Costs of advertising.

*Dealing with all the idiots who want to call and ask dumb questions and come look at it or drive it when not really interested.

*Waiting on financing for the buyer.

*My responsibilty of getting the loan paid, getting the title, passing it on to new owner. And do you let them have the car while all this is going on?

*I'm a single female and I don't like the idea of (a) turning my car over to a complete stranger for a test drive or (b) getting in the car with a complete stranger for a test drive.

I've always traded smart, IMO, and will continue to do so.

 

I had a car that I traded in for $5900, but could've sold privately for at least $6500, if not for $7500. That's a significant difference.

Why did I trade in?

1. Easy.
2. Much easier than private sale because it's a financed car. Much easier.
3. The value loss was not *that* terrible.
4. It's easy to rollover the negative equity into the next loan.

It's a real pain in the *** to sell a financed car in Massachusetts. Mazda American Credit has an "electronic title." They don't have the title actually in hand. So after you overnight them a payoff check, they initiate a title release, which can take 1-2 weeks to get to you. So for 1-2 weeks, your buyer has no title. That's shitty to work with, and who wants to buy a car from someone with no title on hand? And even then, you can't register the car without the title in MA, so whose plates will you be driving around in? There are no temporary plates in MA.

It gets even worse selling a high-$$$ car like the RX-8. With 20K+ on the loan, it's not like you can just pay it off to get the title, and then sell it. (Which is something that you could do with, say, $5K remaining on the loan.)

If anyone knows a better way of selling a financed car privately in Massachussetts, please tell me, and I will buy you beer.

 

Several years ago I sold a 1991 MR2 I had to a private party. A week later they started sending me letters stating that the MR2 had a blown head gasket and threatened to sue me unless I paid for the repair. They had a mechanic write up repair estimates stating that the some make-shift repairs in the way of sealent was found in the valvetrain showing that I had attempted to hide the problem.

I have no ******* clue what they were talking about. They were demanding $1200 or they would take me to court. Rather than spending a day in small claims, the stress, and a possible judgement against me, I offered $600 no apology, and no admission of guilt just to make it go away. It worked.

For that reason I trade in cars. Oh, BTW, yes I had a bill of sale written up to begin with that said AS-IS and such. The problem is they were stating that I had hidden something from them and in CA if you sell a car that is knowingly damaged the AS-IS part might not hold up. It was all BS. For all I know the mechanic was a friend of theirs who used company letterhead to swindle me. Live and learn. I could GAF now, but I was really pissed back then.