Read this tip to make your life smarter, better, faster and wiser. LifeTips is the place to go when you need to know about Trade In and other Car Buying topics.
Calculate trade-ins by deducting the dealer's maintenance costs. Regardless of the condition of your car, many dealers will charge a reconditioning fee of $500 or more.
The reconditioning fee will cover the cost of a safety check, car detail, smog check certification and other maintenance fees. If a car dealer makes a deal to trade-in your car, be sure to ask the following questions:
- Is the trade-in offer before or after reconditioning?
- Can you rollover the outstanding debt of your trade-in to your new car purchase? (Remember to refinance the rolled over loan to avoid a long term loan where you will pay more for the new car than its value).
- What is the wholesale and retail value of the trade?
- If you are under warranty with your trade in, ask the salesperson if he can recommend a new car with an incentive amount that covers your debt. This tactic will help you offset trade-in debt while eliminating the effects of a "rollover.”
- To ensure that you are getting the best deal, request a breakdown of each fee and credit associated with your trade in purchase of a new car.
|Jennifer Mathes, Ph.D.|