Selling a car
Selling a car: trading in vs. private sale
07 December 2017
Your car is a trusted pal that’s probably served you well, but sooner or later it’ll be time to move on. When you do, you’ll need to decide on the sale method. There are two common methods you’ll need to consider: trading it in at a dealership, or conducting a private sale yourself.
Both methods have their pros and cons, so how you decide to go about it will depend on your priorities and needs. Do you need to sell it quickly? Have you decided to go carless? Or do you need to get as much money for it as possible so you can finally embark on that backpacking trip?
Selling through a private sale
Selling your car privately means that you can decide on the selling price, and you’ll often make more money than if you traded it in. You can sell on your own terms and don’t need to deal with a car dealer. However, a private sale is a little like high school: you’ll need to do a bit of homework if you want to get the best result.
First, you need to advertise. You can put an ad online, pop a “For Sale” sign in the window, or list it in the classifieds of the local paper. It’s also a good idea to make the car spotless and get any necessary repairs done.
Private buyers will scrutinise the vehicle from top to bottom, checking for defects. They’re also likely to ask for evidence of the car’s history and condition. This means you’ll need to provide proof of service and maintenance history, and most states legally require you to provide a roadworthy certificate.
Selling or trading in to a dealer
Selling your car to a dealer, or trading in a car to finance (or partially finance) the purchase of a new one, in is a lot more convenient than selling it privately, and it can save you a lot of time and hassle. However, you probably won’t make as much money. The dealership needs to make a profit, so you’ll likely receive 10-20% less than market value.
On the upside, you don’t need to present a roadworthy certificate when you sell or trade in to a dealer. You can also make the deal immediately rather than having to wait for a buyer, which is great – if you’re like a lot of other drivers, you probably want to jump behind the wheel of your new car ASAP.
Getting the car looking its best
Whether you’re selling through a private sale or at a dealership, it helps to have your car looking spick and span. The better the car’s condition, the more money you’re likely to make on it. Give it a thorough clean inside and out. Get rid of any rubbish – yes, it’s finally time to throw out that empty soft drink bottle and French fry box that have been rolling around under the seat for months – make sure the seats are clean and that the outside is washed. You could even consider having your car detailed by a professional.
Sharing the car’s history
Negotiating a price and finalising a sale will probably be easier if you can provide paperwork. Having a logbook, or evidence of regular servicing, will show that you’ve cared for your car, and that it’s been kept in good condition.
Getting the roadworthy certificate
Most states require you to have a roadworthy certificate when selling via private sale. You should check that a roadworthy is required – along with any other conditions (for example, registration transfer forms) – with your relevant road authority. You’ll need to obtain this certificate from an authorised tester or mechanic. Your state’s road authority may be able to point you towards these services.
If you’re trading your car into a dealer, you won’t need a roadworthy certificate.
Practicing the sales pitch
It can be useful to create a bit of a ‘sales script’ to guide you when talking about your car. This doesn’t have to be a splashy spiel, but can be a more genuine outline of your car’s story.
Talk about when you bought it, what experiences you’ve had with it, what it’s been like to drive and what features you love. Keep it short and sweet, and be ready to answer any questions that the buyer or dealer might ask. If you’re unsure about it, practice it on a friend or family member. If it’s good enough, you may even convert them into a buyer!
Negotiating the sale
Whether you’re selling privately or through a dealer, do some research first to get an idea of what your car is valued at. You can look for other cars of a similar make, model and age at dealerships or online to see what they’re selling for. You can also use online car valuation tools to get an estimate.
How much your car is worth depends on its physical condition, its age, how many kilometres you’ve driven and other features like transmission (automatic cars are generally more popular) and colour (standard colours are generally more popular too, so a lime green beast with hot pink flames might have limited appeal).
Getting to know the buyer
You should feel free to shop around, so don’t feel pressured to sell your car to the first interested buyer or trade in to the first dealer you visit.
When selling privately, ask for the prospective buyer’s contact details and a form of ID. If they want to test drive the vehicle, go along for the ride, and check with your insurance company that your policy covers the test drive. When handing over, don’t sign anything transferring ownership of your car until you’ve been paid for it.
It’s important to assess who you’re selling to so you can avoid disappointment and dodgy dealings. That doesn’t mean you need to be suspicious of every buyer. Use common sense, remain firm but polite, and don’t be persuaded to settle for less than you’re comfortable with.
It’s normal to feel emotional as you hand over the keys. You’ve no doubt had some good times with your car; it’s taken you so many places, in rain and in sunshine, in bumper-to-bumper traffic and along expansive country roads. You’ve sung along to your favourite songs in this car. You have the photos and the memories, but now it’s time to say goodbye.
Consider what your needs are, and whether it’s worth selling privately and possibly making more money, or if you’d benefit by trading in and saving both time and effort. However you choose to sell your car, remember that you’re in control.
The information is intended to be of general nature only. Subject to any rights you may have under any law, we do not accept any legal responsibility for any loss or damage, including loss of business or profits or any other indirect loss, incurred as a result of reliance upon the information. Please make your own enquiries.