Trading up on the road. Why it's better to trade in your older car for a newer, safer one this Raya
Dinesh · Mar 23, 2023 05:51 PM
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Youâve had a good run with your current car for a number of years now but the time has come to upgrade your old faithful mode of transport into something a little larger, newer or safer⊠or all of the above.
Cars used to be the second priciest purchase for most people during their lives but with the ludicrous prices of housing these days, cars could very well now be the most expensive thing we ever buy. This ensures that you should place plenty of consideration on the decision-making process moving forward.
There could be a number of reasons for the decision. Maybe your family is growing and therefore a need for more seating or boot space is required. You could even be in a more stable place financially and want to get a nicer car. Perhaps your old car is showing signs of unreliability with repairs more common and the bills are piling up.
Either way, once a decisionâs been made, the most tedious part of the process begins. What do you do with your current car?
Itâs at this point that a number of us might find a tinge of sentimental nostalgia lingering as your current car has served you well. Think of that scene from Furious 7 as the late Paul Walkerâs character and Vin Diesel drove apart on the road as it split, signifying the end of the road for them.
You better wipe those tears away though because youâll need them if you decide to take the more arduous route with your current car.
Trading in your current car is viewed as the easiest and most straightforward route against selling it yourself. The simplified version of trading in or selling it privately falls down to the factor of âtime/effort vs. moneyâ and weâll be delving into it below.
Advantages of trading in your current car
1. Easy and straightforward
Harking back to the aforementioned âtime/effort vs. moneyâ argument, selling your car privately requires time (it wonât sell overnight) and effort (touching up the vehicle). If you can afford the time and effort, you might get rewarded with a better price privately but keep in mind that you canât put a price on convenience and efficiency.
Owning a popular model is a double-edged sword in the used market seeing as it commands a stronger demand but thatâs offset by the fact there will be thousands of examples on the market, meaning buyers are able to push for a lower price as options are abundant.
If you trade it in for a newer car, the dealership will make an offer on the spot and lock in the deal immediately if you agree.
In conjunction with the upcoming Hari Raya festivities, CARSOME is offering a discount of up to RM1,500 on a car purchased from them if you trade in your car with CARSOME. If youâre looking to get a newer and safer ride before your balik kampung trip this Raya, youâll save plenty on effort with the CARSOME deal.
2. Your down payment is covered
Assuming your current car is fully paid off with the bank, you can carry the value of the car over as the down payment for your newer ride. That alleviates the trouble of forking out the usual 10 percent down payment to apply for a hire purchase loan on the new car.
Even if the amount offered isnât sufficient for the down payment, at least a portion of it will be covered with the selling price and you only need to top up a little more.
Additionally, another scenario is if your current car isnât fully paid off with the bank. If youâre selling it privately, youâll need to fork out your own money beforehand to settle the remaining balance before transferring it to the new owner.
However if you're trading it in, the dealership will cover the remaining balance and give you the extra⊠with the caveat that the carâ value exceeds what you owe the bank.
You can then forward the balance as a down payment as well. Simply put, it saves you time and time equals money.
Furthermore, by trading it in with CARSOME, youâll be assured of an additional discount on the newer car you purchase in return.
3. Trade it in and forget about it
Assuming your car is in decent condition mechanically and physically, most dealerships will take it in but with a reduced valuation. The reduced value offered is to cover the cost of touching up the car and making it presentable to be sold.
By selling it privately, you run the risk of the buyer returning after a month or two with any mechanical issues that may arise and demanding a refund or for you to rectify the issue at your cost.
Itâs very much a grey area when it comes to ownership transfers between private parties for cars.
By trading it in with a dealership or CARSOME, the dealership assumes all responsibility for the vehicle. That said, an extensive inspection will be carried out before a deal or offer is tabled. You can make a free appointment for an inspection at CARSOME here.
CARSOME offers free inspections that take between 30-40 minutes. If your current car meets the criteria, theyâll make an offer and handle all the paperwork. Once the car is transferred, youâll carry no further commitment to it.
Disadvantages of trading in your current car
1. Lower valuation
This one is pretty obvious but youâll definitely get a lower valuation for your car if you trade it in as opposed to selling it privately. After all, selling cars is a business and not a charity, so the dealership taking it in will have to touch it up a little (that costs money) before putting it up for sale at a profit.
Nonetheless, most cases of trading in a car is to upgrade to a newer or larger model and by conducting the entire process with CARSOME, you'll be guaranteed a higher valuation for your trade in with their attractive offer as well as the additional RM1,500 discount on the car you purchase from CARSOME.
If you decide to sell it privately, that effectively eliminates the middleman and hence, the middleman fees. Chances are youâll get a higher price but as mentioned before, it wonât sell overnight so youâll need to decide if the time spent waiting for a buyer is worth the higher selling price.
2. Youâre not making back the extra money on modifications or major repairs
A dealership is going to evaluate the car based on the current market value, regardless of the upgrades/modifications or repairs youâve carried out.
Just because youâve installed some fancy wheels or an upgraded head unit, itâs unlikely youâll get more when trading it in. In fact, depending on the modifications carried out, it might even work against you and result in a lower valuation being tabled. For example, fitting some stiffer sports suspension ruins the ride comfort and that would be viewed unfavourably by the next potential buyer.
Same goes for maintenance. Just because you dropped a ton of money on the car recently according to the maintenance schedule, youâre not recouping it during the trade-in.
Wear and tear items are a given in car ownership and itâs your responsibility to keep the car running in accordance with the manufacturerâs recommended maintenance schedule.
3. The dealership might not take your car in
Depending on the make and model, the notion that dealerships will take any car on a trade-in isnât accurate. If you own a car thatâs not popular or is widely acknowledged as being unreliable, the dealership might not want to take it on a trade.
However, if youâre purchasing a newer car from them in return, it could work in your favour though the valuation offered would be way below market value. The reason behind this is that the dealership needs to resell your traded in car. If itâs going to be difficult or take a longer period of time, that equals money lost to them, money that theyâll be sure to subtract from the valuation.
A vehicleâs desirability or demand in the market will significantly impact its trade-in price. However, much like the double-edged sword mentioned earlier, popular models will also mean the dealer has an abundant of inventory and might not offer top dollar for yours.
Conclusion
Summing it up, if you can afford the time and effort required to sell your car privately, you should be assured of a higher price. However, time is money and most people canât afford to waste time these days, so the conclusion is pretty obvious.
Furthermore, by trading your current car in with CARSOME for a newer car, youâll be assured of a discount on the new ride, up to RM1,500.
The number one rule though is to always go into the process of purchasing a newer car knowing your current carâs value. You can do that by looking up used car classifieds online such as on Carlist.my or by making an inspection at CARSOME for a valuation.
It only takes 30-40 minutes to get your car inspected by their highly qualified inspectors for free. While waiting for the inspection to conclude, you can also peruse some of the CARSOME Certified used cars in their inventory as your next ride.
In conjunction with CARSOMEâs Berkat Raya promotion that runs until 30 April 2023, youâll also get discounts up to RM8,000 on selected cars, on top of the RM1,500 discount with the trade in.
A huge part of CARSOME's appeal apart from fair deals and transparency is convenience. To truly make it as easy as possible for customers, CARSOME has collaborated with Public Bank to provide some unbelievably low interest rates on hire purchase loans that complement the great deals already on the table for Hari Raya.
Not only that, thereâs a 1-year free servicing package and a warranty for the same period. Buyers will also receive a RM100 Touch 'n Go voucher.
Lastly, be sure to download the CARSOME app on your phone and register an account before you head over to your nearest CARSOME centre. This will get you the most savings and convenience on your journey to a newer car. You can download the app from this link.
âBetter late than never.â Some despise it, others begrudgingly agree with it but he swears by it⊠much to the chagrin of everyone around him. That unfortunately stems from all of his project cars not running most of the time, which in turn is testament to his questionable decision-making skills in life. A culmination of many wrongs fortunately making a right; much like his project cars on the rare occasions they run, heâs still trying to figure out if another project car is the way to go.
