In an earlier post we covered the importance of having your down payment ready before you buy a new car and now we’ll take a look at the mechanics of how to sell your car yourself to help raise that down payment.
By selling your car yourself, you can maximize the amount of money you’ll get from it. Though many people prefer the ease and convenience of simply trading their old car into the dealership for what ever they’ll give for it, it’s worth remembering that it’s in the dealers’ best interest to see that you get as little as possible. The dealer, we must remember, is always the counterparty in a car sale or purchase.
Sell your car yourself – the mechanics
There are many ways to sell a car, but unless you’re a car dealer, it usually will require a variety of methods. None of the methods listed below are exotic or even new, but it helps to have a list of the available options when starting out. If you think you can do at least a few of these, it might encourage you to give it a try.
- Put big, bold for sale signs in the windows of the car
- Tell everyone you know that you’re selling your car; you never know who knows someone who might be looking for the car you have
- Do an email blast to everyone in your personal email database; ask a few of your friends to forward that email on to their databases
- Post flyers on the bulletin boards at work, at church, at the gym and in any local retail establishments that will allow it; be sure to include a photo or two on the flyer (bonus tip: coin-op laundromats can be excellent places to advertise since people are looking for reading material while waiting on their wash)
- Advertise the car on Craigslist – it’s free!
- Advertise on Autotrader or any other trade publications that are popular in your area
- Advertise it in your subdivision/condo/neighborhood/apartment newsletter, or any other free or low cost advertising media
- If you can’t sell it yourself, try selling it to Carmax. They probably won’t offer you top dollar for the car, but they’ll generally offer you something better than a dealer trade-in, and with fewer strings attached!
Pricing your car for sale
Knowing the value of your car is the first step in selling it. Price it too high and it won’t sell (forcing you to go the trade-in route); price it too low and it may take any advantage away from selling it yourself.
“Trade-in” is the lowest, and the one a car dealer will give you on a trade-in with purchase. You want to do better than this. “Private party” is the likely price you’ll get selling yourself, and your best price guide. “Dealer retail” is what the dealer will sell your car for, but he can charge that much because he has a well-oiled marketing machine.
Autotrader also has a pricing tool on its site, as well as valuable tips to help you sell your car. Check out all three sites before trying to sell, that way you’ll have all the information you need before getting started.
Likely sales prices also reflect the condition of the car, so you’ll want to do some prep work before selling.
Make sure any obvious mechanical problems have been fixed prior to sale. A good wash and wax may do more to increase price and salability than anything else. Also correct any cosmetic defects that you can. For example, if the hub cabs are damaged, you can buy a set of four at Target for about $25. They won’t be original of course, but they’ll be new and uniform and that may be enough to satisfy a buyer.
Have some good looking digital photos of the car (interior and exterior at different angles) to include in any flyers or web or print ads you place. Some people will be most concerned with ad text, but others will be drawn to good looking photos.
In order to perfect the sale of your vehicle you’ll need to transfer the title of the car over to the new owner. Since car titles are documents we get when we buy our cars, but tend to forget about shortly after, you probably want to be sure to locate it before you sell the car. Depending on state requirements, you may have to jump through a flaming hoop or two in order to get a replacement title if you lost the original, and that may take some time.
You’ll also need to provide the odometer reading on the car as of the time of sale.
You will most likely need to collect money for sales tax or any transfer fees required by your state. Check with your state’s department of motor vehicles for details on specific transfer requirements, documents and taxes.
Get the payoff balance on your car loan, if you have one. This number may be different than what you have in an amortization schedule, as there are typically time adjustments and minor fee charges added in.
When you’re getting the balance, also get specific payoff information, such as how and where to send payment, as well as reliable contact information. You’ll want the loan payoff to go as quick and smooth as possible once you have a sale in place.
Method of payment is nothing less than critical. You’ll most likely sell your car to a perfect stranger so you’ll need to protect yourself. A certified check or any other form of transfer where the funds have been verified and restricted by the issuing bank are your best protection.
Even then, before turning the car over to the buyer, call the issuing bank and double check the authenticity of the buyer, the issuance and amount of the check and verify sufficient funds to cover. Verifying certified funds is becoming a more common practice in many businesses now.
The bank may not provide this information to you as an individual, but you may get it with the buyer’s assistance. If the buyer won’t cooperate in this effort, you may have good reason to suspect foul play.
Never accept a personal check! You’ll be turning your vehicle over to the buyer at the time of sale; if he’s paid by personal check and it bounces, you could be out the car and the money. There may be legal remedies available to you, but every one of them will most likely be less than perfect if they work at all.
If the buyer is a con artist, and passes you a check that’s completely bogus he could be a thousand miles away before you even know you’ve been scammed.
By selling your old car yourself, you get a pure play. You know exactly how much money you’ll have to put down on your next car. Trade it in to the dealer however, and you’ll be at his mercy as to what you’ll get for it. Dealers know how to separate us from our money, and often you don’t even get as much money as you’re told you’ll get. As the trade-in value rises, so do other costs on the new purchase. It’s a game we can’t win. Are you ready to try selling it yourself?
Have you ever sold a car yourself? Do you have any advice to give to others? What worked for you and what didn’t?