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Is it a good idea to give the car to the dealer as a trade-in?

When we decide to buy a new car, we must also think about what we will do with our old car. In reality, there are two options available to us. The first is to sell the car ourselves while the other option is to trade it in to the dealer. Each option has its advantages and disadvantages. Let’s have a closer look.


“When we give the car to the dealer, we often get a lower amount than the market price. However, we also get peace of mind, and there are advantages in terms of taxes. So you have to take the time to analyze all the variables,” says a sales representative at Edmundston Honda.

Let’s start with the tax implications. You should know that when you trade in your vehicle, the amount obtained is calculated before taxes on the price of your next car. This is not the case with the amount that is obtained when the car is sold on the market, that amount is applied after taxes. So, yes it is true that one receives less for their vehicle at the dealership, but the difference shrinks because of the reasons explained previously.

For example, if our next car costs $ 20,000 and we get $ 10,000 in exchange, our next car cost us $ 10,000 plus taxes. If we get $ 12,000 on the open market, that amount will be deducted from the amount of $ 20,000 plus taxes. So the difference is not necessarily $ 2,000.

Obviously, we still get more if we sell the car on our own. On the other hand, we must remember that selling our car takes effort. We must find all of our receipts and our service history. You have to clean the car, take pictures, and place it on the various used car websites. You must also remember that you will have to show the car numerous times, and go on numerous test drives.

All this has a price in terms of time and effort. What remains to be determined is whether the effort is worth the difference between the amount we get for our car on the market and the amount we get at the dealership.

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