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When selling your car, feeling informed and confident is crucial. After all, you want to make as much money off of your old vehicle as possible. You may even choose to take profits from the sale and put them toward a down payment for your next car, which would reduce the amount of financing you would need.

But when it comes time to sell, there's homework to do and considerations to make. Here are five tips to keep in mind:

Determine Your Vehicle's Value

You don't want to overshoot on the price and scare away buyers or underestimate how much you could make and lose out on profit.

For help, use the calculators on sites like Edmunds, Kelley Blue Book, and Autotrader. They'll give you two value estimates — one for a private sale and another for selling to a dealership as a trade-in. It can also be useful to view the listings of used cars in your area that are a similar make and model.

Choose Between a Private Sale or Trade-in

However, there are many benefits to trading your car in to a dealer. It's convenient for sure — if you sell it to the same dealer you're buying your new car from, you could drive in with one vehicle and out with another. You also won't have to go through the hassle of advertising your car, showing it to potential buyers, and handling the paperwork yourself.

Typically, you'll pocket more by selling to a private party than to a dealer. That's because a dealer wants to eventually make a profit off of the car they're buying from you — it also takes into account that they will need to spend money getting the car ready to resell.

Likewise, depending on your state, a trade-in that is applied toward a new car purchase can have tax benefits.

Visit Your Mechanic

You probably already have a good idea of your car's condition, but taking it to a garage for an inspection can be helpful. Your mechanic may discover new problems with the vehicle and it's better to know about them before you sell — a potential buyer might hire a mechanic for a pre-purchase inspection.

In addition, having a mechanic's report in hand can help boost a buyer's level of comfort with you and your car's condition.

Decide How Much You Want to Invest

Before you make big repairs, consider whether you'll recoup the cost. Keep in mind that dealers can often fix problems at a lower cost than you can. With private buyers, you might find it more advantageous to simply disclose the problems and anticipate that they'll come up in price negotiations.

However, making small fixes could have big returns for private sales and trade-ins. Taking care of elements like a broken side mirror, worn tires, defective wiper blades, paint scratches, and minor dents doesn't have to cost much but they could help the car look well-loved and increase its value.

Another way to give the impression that you've taken good care of your car is to clean it thoroughly inside and out to make it look as close to new as possible.

Preparing to Show Your Vehicle

If you're going to sell your car yourself, there's a good chance that potential buyers will ask about more than just its current condition. They may also request records pertaining to your car's maintenance and its original purchase. Be sure that you know your car's make, model, engine, and its number of previous owners and accidents. Does your car have an unexpired manufacturer's warranty or service contract and if so, are they transferable? Arming yourself with facts will help you when negotiating.

Think about where you'll meet with a potential buyer — especially if they want a test drive. Meeting in front of the buyer's bank during open hours would be convenient if you request a payment through a certified check or cashier's check.

Ultimately, taking the time to research and prepare for a car sale is critical if you want to walk into a negotiation feeling like you're in the driver's seat.

Disclosures

This information and recommendations contained herein is compiled from sources deemed reliable, but is not represented to be accurate or complete. In providing this information, neither KeyBank nor its affiliates are acting as your agent or is offering any tax, accounting, or legal advice.

By selecting any external link on www.Key.com, you will leave the KeyBank website and jump to an unaffiliated third party website that may offer a different privacy policy and level of security. The third party is responsible for website content and system availability. KeyBank does not offer, endorse, recommend, or guarantee any product or service available on that entity's website.

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