Your mission, if you choose to accept it, is to make a seamless transition from your old car to a new luxury car. Doing so will require you to make a tough decision: Either sell your current vehicle privately or use it as a bargaining chip and trade it in at the dealership.
But which option is best for you: Trade-in or private sale? Let’s take a look at the advantages and disadvantages of selling and exchanging your luxury car.
Pros
Trade-Ins
Choosing to trade your luxury car into the dealership comes with several perks and benefits.
Hassle-Free
There’s virtually no hassle or legwork required to trade in or sell your vehicle to a dealer. This is perhaps the best reason to choose the trade-in route.
The trade-in process is quite simple and convenient, too:
1. Get a trade-in estimate from several local dealers
2. Pick the best car dealership based on the quote, customer reviews and in-stock selection
3. Choose a new car
4. Be happy
Your car dealership will likely take care of the necessary paperwork and after-sale tasks on your behalf, including transferring the vehicle title, registering the car, and even paying off the balance of your current auto loan.
Less Emphasis on Vehicle Condition
Dealers aren’t as concerned about your vehicle’s current condition as prospective buyers would be. Their body shop and service center will handle all needed maintenance, cosmetic repairs, and replacement parts; this extra work is already calculated in the trade-in value estimate you received.
Note: If you decide to get an impromptu trade-in value by visiting your dealer, clean and detail the vehicle beforehand. A clean car may get you a better price.
Covers Your Down Payment
When you exchange your vehicle for a newer one at the dealership, you can use the trade-in cash as your down payment – and maybe even have some leftover dough when all’s said and done.
Tax Advantages
Most states only require you to pay sales tax on the difference between your trade-in vehicle and the newly purchased vehicle. This can save you hundreds of dollars, especially when you’re dealing with luxury cars and SUVs.
For instance, if you’re buying a new Genesis G70 sedan for $35,000 and trading in your old BMW 330i for $15,000, you’re only required to pay taxes on the $20,000 difference. That saves you approximately $900 (at a 6% tax rate).
Private Sales
Choosing to sell your vehicle to a private buyer is a decent option – if you know what you’re doing, that is.
Higher Price
Selling your used car usually nets you more money than trading it in. You set your price. You choose to negotiate or walk away. If you aren’t happy with the offer, put it back on the market and find a new prospective buyer.
Flexibility
When you sell your car, you’re not obligated to spend the earnings on a new vehicle. Instead, you can use part of it for a down payment, another part on your mortgage, and save the rest for a rainy day. It’s your money, after all.
Cons
Trade-Ins
Of course, trading your vehicle in also has its disadvantages, though there are fewer of them than the alternative.
Lower Cash Offers
Because you’re “selling” your car to a for-profit business (dealerships), you’ll only receive a wholesale or market-value offer on it. Dealerships have to inspect the vehicle, fix it up, make it look pretty, and then find a seller. All that work required on their end means they’re likely not going to offer as much for your car as a private buyer would.
Negotiations
There’s some negotiation involved in trying to maximize your trade-in value and get a lower price for your new vehicle – both at the same time. If this is too stressful for you, you may want to separate this process into buying your vehicle and selling to a private buyer.
Private Sales
There are numerous disadvantages to selling your luxury car to a private buyer.
Inconvenient
Selling your luxury sedan privately is a hassle! There’s simply nothing convenient about it. To get the best buyers knocking on your proverbial door, you must:
- Clean and detail your vehicle
- Repair any lingering issues
- Take dozens of flattering pictures of the vehicle
- Include vehicle specs, features and any mechanical or cosmetic issues in your ad
- Find places to list your ad
- List the ad online or in the classifieds
- Answer questions via email, text or phone call
- Provide car history reports
- Deal with people
- Handle paperwork, including titles, a bill of sale, and tax documents
And that’s all before you even sniff a dollar on the sale. It takes a lot of energy, time and commitment to sell your luxury vehicle online.
Danger & Fraud
You’ll have to deal with lots of different types of car shoppers, including people who clearly have no intention of buying your luxury car. They may want to take a test drive in a vehicle they cannot afford to buy from a dealer, for instance. It’s not the end of the world, but it’s certainly a waste of your time.
Sometimes people will test drive the car and simply never return, leaving you with a fake driver’s license and a non-cashable check. In rare instances, private car sellers have also been straight-up robbed. If you decide to sell your luxury vehicle to a stranger, be sure you take extra precautions:
- Screen your buyers before agreeing to meet
- Meet in a public, populated place, like a police station parking lot
- Bring a friend or more (safety in numbers)
- Only meet in daylight
- Never provide your home address
- Always accompany shoppers on test drives
- Check shoppers’ proof of insurance
- Only accept cash or a money order certified from a bank/lender
- If the buyer attempts to pay with a check, be sure the address is the same as what’s listed on their driver’s license
Negotiations
If you dislike negotiating with a dealership salesperson, you’re going to hate negotiating with a private buyer. The stakes are higher, and you may have to get confrontational if the “best offer” is nowhere near your “must have” sale price.
More Sales Tax
You must pay tax on every dollar you make on the sale, though you can add that cost into your asking price to offset your out-of-pocket costs.
Fewer Buyers
Because you’re selling a used luxury car and not a used Hyundai Sonata, you may have more difficulty finding buyers (there are fewer of them). That’s why it’s better to let your used luxury car dealer sell your vehicle for you.
Time to Trade In Your Vehicle at Braman Genesis
Have a vehicle you want to get rid of in Miami? Visit our Genesis dealership in South Florida to get your vehicle appraised as a trade-in. We offer fair-market value or better for all vehicles, no matter their age or condition, and would be happy to help you use it to upgrade to a new Genesis sedan.
Contact Braman Genesis at 786-574-3095 or bring your used vehicle into our luxury car dealership at 2001 NE 2nd Ave in Miami, FL.
Categories:
Pre-Owned Inventory
