How to Determine How Much Your Car is Truly Worth
We receive a lot of emails from people who have just started using our Exotic Car Hacks program and realize after watching the full 4-hour video that they have been ripped off on their previous car purchase (before they knew of our strategies). However, that’s not uncommon as the majority of car dealers are in business to make money, not friends. While this is a small setback, there are ways to add value to your car and cut your losses quickly so that you can transition your car from a liability to an asset. I have outlined here the best way to determine what your current car is worth and the best way to get rid of it.
- Get a cash value estimate. A car is only worth what someone is willing to pay for it, so tools like Kelly Blue Book are pretty pointless when selling. Cash value is what your car is worth today on the streets at its bottom state. Usually that number is what the dealer would pay you on the spot if you brought it in. The best and easiest way to get the estimate is to go to Carmax and have your car appraised; that amount becomes the single lowest number your car is worth. Knowing that figure and without disclosing it, take your car to several local dealerships that are of the same mark. Take Audi cars to Audi dealers and ask if they have any interest in buying the car from you. Once you have three estimates, take the highest one and this what your car is truly worth. Do not be shocked and do not cry, because we have seen the lack of knowledge crush people when they see what they paid less than two years ago and suddenly what it’s worth today. Don’t you wish we were around to teach you three years ago?
- The second value that matters when selling a car is the trade-in value, because there are incentives in trading in a car versus straight up selling it even if the dealership isn’t related to the type of car you are selling. In most states there is also the opportunity to receive a tax credit on a trade, which means that whatever your car is worth will be taken off the price of the new car so that you pay less taxes. Check with your local DMV office to see if your state allows a tax credit. When you are buying a car, a dealer has interest in the commission they will make on the car, and in order to secure a deal they may offer more than the cash value of your car in order to close the deal. This extra cash coupled with a few grand of tax credit may not be far from where you wanted to end up anyways.
A while back we attempted to sell the Audi R8 found in the case studies for $95K privately, but we were hardly getting any interest in it. We finally looked at its cash value which was $85K (a huge $10K difference but if you account that the tax credit was $5,100, and we got the dealer to cough up an additional $2K to make the deal on our newer Aston Martin DBS). So technically we only had a $3K difference, which is hardly a big deal and worth the convenience of getting rid of it.
Education is key to knowing what your car is worth. Nothing prevents you from calling the dealer to understand how much margin they are actually making from you on that awesome new car you have had your eyes on. It’s a great way to determine what a car is really worth.