How do Trade-ins work?

(16 Posts)
LazyFaire Wed 07-Aug-13 10:24:44

I'm 25 and driving the car I used to share with my mum, she gifted it to me after I left Uni so I have no experience in buying or trading in cars. My DP has a history of getting lemons and this will be our main car (EG needs to be reliable so when his breaks down he can use mine!)

My car is an 04 plate Punto, recently MOTed and had welding done which I have been advised will be an ongoing problem (not a car person me) so would be good to get rid if I can. Also has advisories RE tyres and brake lines, a small crack in windscreen which has been autoglassed but probably should be replaced (just scraped through the MOT) and a crack in the bumper which I would replace if worth it before trying to sell. Just retaxed until Jan 14 as well.

If you trade in a car, can you get like for like-ish or do they expect you to pay more on top (for a better/newer car?)

Will I get my money's worth trading in or should I sell mine then buy another?

Is trade-in only really through dealers or can you get one on Whatcar/Auto trader/Gumtree/local garage/ anywhere else?

Based on the info I gave, any idea roughly how much it might be worth?

Thanks for helping a car noobie if you can smile

AKAK81 Wed 07-Aug-13 12:12:04

I'd say you'll be lucky to get more than about 500 quid for that trade in. I assume you're not looking to spend much more so it would probably be best selling privately and then buying privately. Anything you buy from a dealer for under 2k will most likely be in shed territory.

LazyFaire Wed 07-Aug-13 12:19:24

shed territory? Does that mean nearly broken? I could probably add another 500 but would be credit card money.

Would I get more than £500 selling, or is trade in value basically what it's worth?

Is it worth doing the fixes before selling (eg. would I get the money I spent back, or would it just be worth the same but look nicer?)

WMittens Wed 07-Aug-13 13:18:12

It's worth what someone will pay - a dealer needs to turn a profit, i.e. buy low-sell high; a private buyer is looking for a car to use. So a dealer will most likely give you less for the trade in than if you sold it privately.

Similarly, it's cheaper buying from a private seller than a dealer, but you have less comeback if things go wrong.

As AKAK said, you'll get a better deal doing things privately, but it's more effort overall.

A shed is a car approaching the end of its life, several things wrong, might need some work - can be an absolute bargain if you're lucky and it runs for another 50K miles, its faults can be charming in their own way; or it could break and it goes the great scrapheap in the sky, and you replace it with another shed because it's cheaper than fixing the old one.

You will not get a like for like car if you trade in because, as said above, the dealer has to make some money. If you swap without putting any extra money in, you'll end up with a car worth less than your current one.

LazyFaire Wed 07-Aug-13 13:31:25

OK.

I guess I will make moves on getting it fixed up cheaply (my DP could fit a new bumper if we got it from the scrapyard, tyres can get done with basic replacements etc) and then sell privately.

I was hoping a trade-in might get me a better car for the money, but I don't have 2k and I would like something not likely to break down as DP got his last year and it has been in the car park waiting to get fixed more than he has driven it ffs!

LazyFaire Wed 07-Aug-13 13:31:50

Thanks for the help too smile

OldLadyKnowsNothing Wed 07-Aug-13 13:58:26

I have only ever bought used cars in the under £3k category.

Looking at autotrader, you could sell for anywhere between £500 and £1000, depending on condition and milage; the head gasket blows as they approach 100,000 miles. <no, I haven't bought two of the buggers in that price range> angry So, that would give you the money, plus your £500 credit card cash, to buy something else in that price range. Which may, or may not, be reliable.

DS2 is a car salesman, and this is what he would say.

He would allow between £500 and £1000 trade-in, depending on age and condition, and depending on which deal he could then sell you; it is possible to get more trading-in than selling privately. (He told me of such a deal just last week. They needed the turnover for their sales targets and were prepared to take a small hit.)

Then he'd sell you a shiney new, or almost-new car, perhaps a demonstrator. Your old car is your deposit, and you sign up to a finance deal; you might even get a zero-percent interest rate. <T&C in tiny writing> For less than £200 a month (£180 has been achieved) you can drive away a brand new <insert name>.

The downside to these deals is that you never actually own the car outright, because there's a "bubble" of <however many thousands of pounds you haven't paid back> at the end of the interest-free period, and you probably won't have saved it up.

So you trade that one in for another brand-new car (because the salesman will make this possible) and you have another brand-new car, for £200 a month. Which you never actually own, because there's a bubble at the end...

Some people like to have a brand-new car every three or four years, and they're happy to pay £200 a month for the privilege. Are you and your dp like that?

I'm a bit more debt-adverse, personally, but I can see the positives.

LazyFaire Wed 07-Aug-13 14:15:07

No. I absolutely cannot afford to pay £200 extra a month for anything. This would need to be an outright buy or trade. Do they only trade in on new financeable cars? sad see what a noob I am!

I don't need a new car, but maybe an 06-08 model (I don't know how feasible that is for £1000-£1500). All I really want are 5 doors, 4 seats, 4 wheels and a steering wheel!

OldLadyKnowsNothing Wed 07-Aug-13 14:33:40

Yup, trade-ins are only on financiable cars, sorry; the car is in lieu of a cash deposit.

So you're back to selling privately, and buying again.

Do some searches on Autotrader and similar sites, see what's available. Don't buy a petrol-engined car with more than 60-70,000 miles on it, especially if it's very small-engined. Do look for a recent MoT. If you see a car you like, google that make and model and look for common faults; there will probably be a forum somewhere dedicated to it, and people can be surprisingly helpful.

And check out how much the insurance and tax disc is going to cost, but you know that one already.

AKAK81 Wed 07-Aug-13 15:19:54

Erm trade ins aren't just available on new/nearly new financiable cars. You can pretty much trade in against anything you want with any dealer/trader but only if they'll make something on the deal one way or another. You can often get a better trade in deal with finance as the dealer is making money out of the finance. In your situation I would seriously consider keeping your current car and fixing it as it breaks. Any car you go out and buy for 1-1.5k is just as likely to need money spending on it in the next 12 months as your current car. Definitely a case of better the devil you know.

LazyFaire Wed 07-Aug-13 15:31:29

Thanks Folks. Looks like a trade-in is not for me either way. I will save up for the fixes I know are coming and only if I have to will I will sell on. You're right in the better the devil you know stakes this has been at least partly my car for 8 years now.

OldLadyKnowsNothing Wed 07-Aug-13 15:36:28

It might be possible to trade-in at that level, but it would the worst possible decision for the OP. The dealer would offer a low trade-in value (because he wants to make a profit on resale) and charge dealer-price. And Op still ends up with a potential shed.

OldLadyKnowsNothing Wed 07-Aug-13 15:37:37

X post with OP. Good decision, I think, and good luck.

olivo Wed 07-Aug-13 15:40:00

I got 1200 trade in on a very good condition 12 year old car, they currently have it on the forecourt for 3000.

The car we bought from them for 6900 ( so 5700 after trade in) is apparently only worth about 5k.

Go for private sale and buying. We were naive, very naive.

WMittens Wed 07-Aug-13 18:27:26

the head gasket blows as they approach 100,000 miles.

There's no hard and fast rule around that, it depends on the engine, how it's been driven, how it's been maintained, etc.

And anyway, in the case of the Rover K-series engine, it's every 5,000 miles.

OldLadyKnowsNothing Thu 08-Aug-13 14:18:59

Oh, I know it was a wild generalisation but it came from experience. Tbf to Fiat, both cars were end-of-life, under £1k examples bought for a teenage boy... there may have been a certain amount of inevitability about it. grin

<makes note to avoid Rover - oh, no, I already do that>

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