You’ve spent a few wonderful years with your beloved car. It’s been an exciting journey, full of ups and downs. But suddenly, you feel that itch and you know it’s time. It’s time to upgrade your car.
Finding your next car is easy as long as you know what you want. The thing that gets a lot of people stuck is… what to do with your old car? Should you trade-in at the dealer or sell it yourself?
Ask around and views are split. Each option has its merits and it usually depends on an individual’s needs. So, let’s take a look at the pros and cons of these options, key points to consider and what you should do.
Sell your car
There are a lot of ways to go about selling your car. You can either sell your car through consignment, sell to a car dealer or to a direct buyer. These methods have their own pros and cons, and preferences vary based on your individual needs.
If you’re not in a hurry, you should sell to a direct buyer as you’re likely to get the best price for your old car. If you’re looking for decent value and convenience, you should consider selling through consignment.
You can also put it up for auction on an online car marketplace like CARRO. This method of selling your car has been gaining popularity as it offers the most value and convenience.
The entire experience is pretty straightforward. Simply submit your details and you’ll receive a quote for your car from our network of over 1,000 dealers in Singapore. The best part? You can get it all done in just 1 day!
As compared to trading-in your car, you’re more likely to receive a higher figure when you sell your car privately. You have full control and, if your situation permits, you can even wait out for a better offer, one that you’ll be satisfied with.
The whole car selling process is no easy feat. It requires a lot of patience and hard work. Dealing with potential buyers or going from dealer to dealer to get a quote, it’s really time-consuming and tiring. In many cases, the process can take months to complete.
And that’s just the tip of the iceberg. There’s the haggling and negotiations, fear of getting scammed, mountains of paperwork and you’re always at the mercy of the market and COE prices.
Another issue might arise if you can’t sell your car in time before getting your new car. The monthly repayments will still be there, so you’ll have 2 bills to pay every month!
Trade-in your car
If you’re looking for an efficient and convenient way to get rid of your car, you should look to trade-in your old car.
Most car dealers allow you to trade-in your old car when you get your new car from them. This option is as straightforward as its name suggests and you’ll be able to use the trade-in value of your old car to offset your new car purchase.
There’s also a practice where dealers offer a higher trade-in value for your used car so that you’ll be able to tide over the large sums of down payment. This practice is known as overtrading.
Here’s an example to help you understand how overtrading works.
A $100,000 new car requires at least $40,000 as downpayment. In overtrade, the seller will raise the car price to $110,000, and at the same time giving $10,000 more than what the trade-in car is worth.
Although the buyer now needs to put down $44,000 in downpayment, he will now have an additional $10,000 more from his trade-in, making his downpayment only $34,000.
This practice helps drivers who can’t afford the hefty downpayment as they will fork out a lower amount.
When you trade-in your car, you’ll be doing it at the same dealership as buying your new car. The ‘buy and sell’ process happens at only 1 location. Unlike selling your car, which takes weeks to complete and wastes a lot of time, you can complete your trade-in almost immediately. So, it’s a lot more convenient and efficient.
The trade-in process is hassle-free and the dealer handles everything for you. From the piles of paperwork to repairing any minor defects, you don’t have to worry about a thing.
Another plus point to trade-in your car is the immediate benefit you receive. You can use the trade-in value to offset your new car’s price, which will make the downpayment lower. Due to Singapore’s pricey car market, this immediate benefit is very appealing to many drivers.
The practice of overtrading is another advantage that appeals to many. As explained earlier, the practice helps lower your downpayment amount which makes getting a new car a tad bit easier.
In life, nothing is free. There’s a price you have to pay to enjoy all these benefits and that usually comes packaged as a lower valuation.
Your trade-in valuation is usually lower than when you sell your car privately. It’ll almost definitely be lower than what your car is really worth.
As dealers usually source for only a handful of quotes, the competition is scarce. With so little competition, it’s unlikely that you’ll get a market value quote for your old ride. Additionally, if you trade-in your car at an authorised dealer, the dealership will take a cut out of your trade-in value as brokerage fees.
What should you do?
It really depends on what you value most. Many would say that money is more important, even more so in expensive Singapore. The more you get from selling your car, the cheaper it will be when you get a new car.
But convenience and efficiency cannot be overlooked because, as cliche as it is, you can’t buy time. So if time and convenience are what’s more important to you, this is the price you have to pay – a lower than market valuation.
The best thing for you to do is compare both valuations and only then make a decision.
Looking for a new car? Get yours at CARRO and experience the smarter way to buy a new car! Enjoy factory outlet prices, get a high trade-in value for your old ride and save more when you decide your own COE price.