Are you thinking about selling your car? If so, you might be wondering whether it’s better to trade in your car or sell it privately. In this blog post, we’ll explore the advantages and disadvantages of each option to help you make an informed decision and get the most money you can for your car.
So, which option is best for you?
If you’re asking “Should I trade in my car or sell my car privately?” Here is the short answer: if you value convenience and are willing to accept a probably lower price for your car, trading it in might be the best option for you. However, if you’re willing to put in the time and effort to sell your car privately, you may get a higher price. The best option for you will depend on your individual priorities and circumstances.
Is trade-in the same as selling?
No, trading in your car involves selling it to a dealership in exchange for credit towards a new car.
Is it worth trading in an old car?
Trading in an old car can provide tax benefits, and we will explain this further below. Additionally, it is more advantageous to repair the car and sell it privately in order to maximize your earnings from the sale.
Some statistics to help you make an informed decision
Both options have their pros and cons, and it can be difficult to decide which one is the best option for you.
- According to Edmunds, trading in your car can be a good option if you’re looking to save time and avoid the hassle of selling your car privately. In 2020, the average trade-in value for a used car was $17,080, while the average private party sale price was $19,753.
- However, according to Kelley Blue Book, selling your car privately can get you up to 15% more money than trading it in.
- A survey by CarMax shows that 42% of people who trade in their cars do so because it’s more convenient than selling it privately.
- On the other hand, Autotrader states that 61% of people who sold their cars privately did so because they wanted to get more money for their car.
Please note that you can easily sell your car on Mintlist or even trade it in for another car. Our vetted buyers will compete for your car by offering their best price. All you need to do is sign up and follow the steps to complete your profile in under ten minutes.
Then just wait for the best offer and we can sell your car within 24-48 hours!
Should I Trade In My Car?
Whether or not you should trade in your car depends on several factors, here are some important points to consider:
Here are some of the advantages of trading in your car:
One of the biggest advantages of trading in your car is convenience. You don’t have to worry about finding a buyer, advertising your car, or negotiating a price. Instead, you can simply take your car to a dealership and trade it in for a new one, or you can use Mintlist and we will bring 200+ vetted buyers from all over Canada to you!
When you trade in your car, you only have to pay sales tax on the difference between the trade-in value and the price of the new car. For example, if you trade in a car worth $10,000 and buy a new car for $20,000, you only have to pay sales tax on the $10,000 difference. This can save you a significant amount of money in taxes.
In the following tables, you can find the amount of tax you would pay if you chose to buy a car from a dealership and also from a private seller.
|Province||Federal Sales Tax (GST)||Provincial Sales Tax (PST/RST/QST)||Total Car Sales Tax|
|Dealership||Private seller||Dealership||Private seller||Dealership||Private seller|
|British Columbia||5%||0%||7%**||12% – 20%*||12%**||12% – 20%**|
* The car sales tax in BC can be as high as 25%, depending on the value.
** The provincial car sales tax on passenger vehicles sold privately in BC ranges between 12% and 20%, depending on the purchase price.
*** Used cars purchased privately in Saskatchewan with a purchase price of $5,000 or less are exempt from PST.
You don’t have to worry about the paperwork involved in selling a car privately, if you are trading in your car. You don’t have to worry about transferring the title, ensuring that the buyer has insurance, or dealing with potential scams or fraud.
However, there are also some disadvantages to trading in your car:
Dealerships are in the business of making money, so they will always offer you less than your car is worth. This means you’ll likely get a lower price for your car than you would if you sold it privately.
When you trade in your car, you’re limited to the selection of cars available at the dealership. If you’re looking for a specific make or model, you may not be able to find it at the dealership where you’re trading in your car.
Now, let us look at the pros and cons of selling your car privately!
Should I Sell My Car Privately?
To Sell your car privately, you have to advertise it, either online [List for sale in under ten minutes on Mintlist’s] or through the old-fashioned for-sale sign on the rear window. Next, you have to keep looking for a potential buyer and negotiate a price. Test drives, receiving payment, and transferring ownership of the car are the steps that follow.
Here are some of the advantages of selling your car privately:
Do you get more money selling or trading? When you sell your car privately, you have the opportunity to get more money for it than you would if you traded it in. This is because you can set the price yourself and negotiate with potential buyers.
When you sell your car privately, you’re not limited to the selection of cars available at a dealership. This means you can use the money you make from selling your car to buy any car you want, regardless of where it’s sold.
Control over the process
When you sell your car privately, you have more control over the process. You can choose who you sell your car to, negotiate the price, and ensure that the transaction is completed safely and legally.
However, there are also some disadvantages to selling your car privately:
Private car sales can be a stagnant process. You have to advertise your car, field phone calls and emails from potential buyers, and schedule test drives. This can be dull and take up a lot of your time and energy.
In addition, you have to acquire certain documents before you start the process. For example, if you want to sell your car in Ontario, here are the documents you need to prepare beforehand:
- Safety standards certificate
- Used Vehicle Information Package (UVIP)
- Bill of Sale
- Application for transfer
Don’t forget that Mintlist can take care of all these tedious parts for you!
Potential scams or fraud
When you sell your car privately, you open yourself up to a world of new and risky experiences. Even if it is not your first time selling a car, you should always be alert and mindful of the situation. You have to be careful to ensure that the buyer is legitimate and that the payment is secure.
Important tips for selling or trading in your car
There are additional factors that you may need to consider before making a decision, which usually differs for each car and each seller:
Condition of your car
The condition of your car can have a big impact on whether you should trade it in or sell it privately. If your car is in poor condition or has a lot of kilometers on it, you may not get as much money for it if you sell it privately. In this case, trading it in might be a better option.
If you need to sell your car quickly, trading it in might be the best option for you. Dealerships can usually complete the transaction quickly, which can be helpful if you need the money or need to get a new car quickly. However, if you have more time and are willing to wait for the right buyer, selling your car privately may be a better option.
If you’re a skilled negotiator, you may be able to get a better price for your car if you sell it privately. However, if you’re not comfortable negotiating or don’t have the time to do so, trading in your car may be a better option.
In conclusion, the decision to trade in your car or sell it privately is one that requires careful consideration. Both options have their pros and cons, and the best choice for you will depend on your individual circumstances. Consider factors such as the condition of your car, your time constraints, and your negotiation skills when making your decision. And remember, whether you choose to trade in your car or sell it privately, be sure to do your research and make an informed decision that works best for you.