Whether you’re looking to sell your vehicle or just want to calculate your net worth, knowing the value of your car can help tremendously. However, determining value takes a little bit of time and know-how. Fortunately, we’re going to share with you the top dos and don’ts when it comes to determining your vehicle’s value so you always get an accurate one.
Do Use Online Industry Resources
One of the best things that you can do to determine the overall value of your vehicle is to check out some of the industry-standard online pricing guides. These can be found at sites like Kelley Blue Book, Edmunds, and the National Automobile Dealers Association (NADA). You’ll simply
need to answer a few questions about your vehicle, such as its mileage, year, make, model, condition, and so forth. Additionally, you’ll need to mark if it’s diesel, gas, flex fuel, hybrid, or even electrified. Electric vehicles can bring in a higher value than traditional gas-powered
vehicles.
It’s important to realize that your vehicle’s condition plays a big role in its overall value. Assume two identical cars have the same year, make, model, features, and mileage. However, one vehicle has multiple dents while the other has none. The vehicle with no dents is going to have
a higher value than the vehicle with dents or paint chips.
When you’re researching your car’s value at all these online sites, you’ll want to take a look at their condition guide to determine where your vehicle accurately falls so that you can get the most accurate value for your car. Also, you’ll want to utilize multiple online resources so that you
can get a median value for your vehicle.
Do Know the Specific Value You’re Looking For
It may seem counterintuitive, but your vehicle does have multiple values. If you decide to sell your vehicle privately, it’s going to be worth a different amount than if you trade it into the dealership. Knowing what specific value you’re looking to determine for your car’s worth is an
absolute necessity to get an accurate figure.
Trade-In Value
When you decide to turn your vehicle into a dealership to purchase a new car, it’s considered a trade-in. This is going to be the lowest accessed value of your vehicle. You may hear a trade-in value referred to as its wholesale price.
Private Resale Value
If you decide to sell your vehicle to another person on the open market, then it’s considered a private party resale transaction. This is going to reveal the highest amount that you can get for your used vehicle. It’s important to note that while this value is higher than the trade-in value, it
will be less than what a dealer would mark as the retail price to sell your vehicle on their lot.
Don’t Think You Can Get What the Dealers Do
When you’re trying to determine the overall value of your vehicle, you may be tempted to look for a similar one at a dealership. It may make sense on the surface that if the dealership is selling a vehicle like yours for a set amount, then you should be able to sell yours for a similar
amount. That simply isn’t the case.
Realize that vehicles sold at dealerships are going to have a higher retail price. In fact, most dealers can get away with charging between 8 and 10 percent of the car’s overall value on top of its trade-in or private-party value. For example, if the private party’s resale value of your vehicle is $10,000, a dealership will likely sell the same vehicle for $11,000 or more.
Don’t Forget Diminished Value
Since vehicle history reporting has hit the mainstream with easy access to internet records, most individuals take a car’s history into account when determining its actual value. You don’t want to forget to incorporate any accidents that your vehicle has gone through that have
diminished its value.
As a general rule of thumb, you’ll want to use a factor of 20 to 25 percent of the vehicle’s value. This is assuming that the accident didn’t create any structural damage to your vehicle. For example, let’s say your car is valued at $10,000. You’ll need to reduce that amount by 25 percent, on the high side. That leaves you with an estimated vehicle value of $7,500. That’s a big difference that you don’t want to leave out when trying to get an accurate calculation of your vehicle’s value.
It can be very helpful to check in and see what the value of your vehicle is every now and then. By using the appropriate resources that we went over above, you’ll be well on your way to getting an estimated value for your used vehicle. Just be sure to avoid pitfalls like not taking into
account a diminished accident value.
Written by Taylor McKnight, Author for Edmunds
