- Smart Investing
Selling your car on your own? Here are some tips.
In our last post we talked about the advantages about trading in your car rather than trying to sell it yourself. However, it is not always better to trade in as we discussed and, if you are willing to put in the effort, you can usually do a little better selling yourself (we are not contradicting ourselves – for most transactions it is not worth the time to sell it yourself but if we are just talking the actual cash trading hands you can usually do better selling yourself).
So, here are some tips for maximizing the price while minimizing the hassled when selling your old car.
Before showing the car:
Do your homework on price – Luckily these days there are many online sources you can use to determine a reasonable asking price (autotrader.ca, carfax.ca, vmrcanada.com) to name a few.
Correct major repair issues – If there is a serious issue with your car, most people won’t touch it or else they will give you a price that is far below what you could have gotten by fixing the issue. Our course if the problem is very serious, the car might be only worth scrap value or for parts.
Clean it Up – Buyers for anything, including a car, like to visualize themselves driving in the car and it looks a lot better to visualize yourself in a clean car than in a dirty car with trash on the floor. Car dealers often wash their cars once a day. Follow their lead and make sure your car is clean in the advertising pictures and when potential buyers come to see it.
Advertise – Most buyers use multiple sources when looking for vehicles. While you can just put a sign on your car and hope for the best, you will be best served by advertising your car in one or more sites like Kijiji or AutoTrader.ca. Pricing is usually less than $100 for most sites and free in many cases. Remember to take a lot of great pictures and look at other ads for inspiration on the write up.
Compile the Cars Service History. – While not all buyers will ask for this, if you’ve kept maintenance up, showing the maintenance records will increase the value of the car.
Get the required paperwork together - Depending on where you live that could mean a Drive Clean emission test or a used vehicle information package. Most buyers want to do a transaction immediately and if your car is not ready to be transferred, you could lose a sale.
Keep you options open with buyers – Buyers are a fickle lot. Many will tell you they want to buy the car and are sure they want to do the deal, only to ghost you or change their mind well into the process. Avoid “holding” the car unless the buyer commits to a significant deposit, only refundable for certain events (a poor mechanical inspection for example).
Price the car slightly above what you really want for it. – All buyers want to think they got a good deal and no matter the price you are asking for the car, everyone is going to ask for a lower price. The solution is to price the car above what you are willing to accept for it so that you can “compromise” with the buyer and make them feel like they got a win. For example, if you think the car is worth $8,000 after your research, price it at $9,000, giving yourself $1,000 room to move. You could price it even higher but that might scare off potential buyers. Ten to fifteen percent above the desired price is a good guideline. Be aware that you’ll receive many calls from people who want to buy are car at a fire sale price and then resell it. Just ignore these calls.
Take only cash or same-as-cash payment - Make sure that prospective buyers know in advance that you’ll only accept cash, certified checks or money orders in return for the vehicle (no personal checks).
While showing the car
Make sure the car is clean and ready to be driven (see above).
Consider meeting in a public place like a mall and bring a friend. While many people allow prospective buyers to come by their house, there have been incidents of threats and violence. Therefore, meeting in a public place is usually preferred. The downside is you’ll often get stood up by potential buyers and waste your time (which is why many people still just have potential buyers come to their home).
Accompany the prospective buyer on the test drive. It is pretty risky to allow them to go alone. If you decide to do that, make sure you get a picture of their license and verify that they are insured.
Allow and inspection before close. It is acceptable for the buyer to have an inspection done by a licensed mechanic at their request but make sure you ask for a copy of the report (in advance) so you can show it to other potential buyers if the deal ultimately doesn’t go through.
Have the paperwork ready to go. You could lose the sale if you are not ready to transfer the car if you’ve agreed on the price and the buyer has the money available.
Use standard negotiation techniques. Do not drop your price until the prospective buyer has given an offer. If you have multiple buyers interested in the car, it is acceptable to take an offer that isn’t acceptable and tell the buyers that you’ll get back to them by the end of the day. They’ll either accept that or sometimes they’ll improve their offer.
It’s not over until you have money in your hand. Remember that a deal isn’t done until you received money for the car. If a prospective buyer says they want the car, tell them that you can’t hold it until you’ve received a significant deposit.
Good luck selling your vehicle!