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Trade-ins are undervalued by car dealers and over assessed by consumers. The value of the automobile trade-in is commonly misunderstood by consumers.
When consumers research the value of their car, the highest amount is not what most car dealerships expect to pay. Unfortunately, a trade-in is worth much less to a dealer because their target gross profit per unit is $1,200 and up.
When shopping around for a car dealer to trade in your used vehicle, look at the other cars on the lot. If you have a Saturn and most of the dealer's cars are foreign imports, the chances of making the most from your trade in are nil. If you have a red Acura and three other cars on the lot are red Hondas, do not expect much for your trade in.
To maximize the value of your trade in, remember to size up a car dealership's other vehicles.
|Jennifer Mathes, Ph.D.|