by Dee Shaffer

Created on: November 07, 2008   Last Updated: November 16, 2008

Entering into the car buying process can be a disheartening experience. It stirs up distrust because there is a seemingly endless supply of predators waiting for their next victim. It also invites a certain level of anxiety because it requires you to know the appropriate value of your vehicle.

With the increased availability of do-it-yourself technology, many tools exist to help equip you with the necessary information needed to reasonably negotiate the price of your vehicle. The key is to determine the fair market value for the car you want to sell. That sounds easy, but getting accurate information from reputable sources can be challenging. Follow these guidelines as you move forward in the process of selling your vehicle and you will significantly increase your chances of negotiating a very reasonable agreement.

According to Consumer Reports, a non-profit, independent, expert resource for consumers, "knowing a vehicle's true value is critical to getting the best deal". Understanding the difference between retail price and wholesale price/trade-in value is essential in determining your vehicle's price. Before you get started, know the terminology so that you can talk the language. Consumer Reports defines these prices as:

The Retail Price

This is the higher of the two, and is what you would expect to pay for the car if you were buying it at a dealership. If you are buying it from a private seller, you can usually expect to pay a somewhat lower price. This is also considerably higher than the price you'll probably receive for your trade-in because it includes a profit margin for the dealership.

Wholesale price/trade-in value

This is essentially a car's trade-in value to someone, such as a dealer, who wants to sell it to someone else for profit. Understandably, it is much lower than the retail price and it is unlikely that you will be able to buy a used car for this price. But it's also a figure you should know if you're trying to decide whether to trade in your current vehicle or sell it yourself.

Both price definitions are useful whether choosing to trade-in or privately sell your vehicle. Understanding both will help you decide which your best option is as you consider selling. Once you become aware of these car buying/selling terms, it is important to determine the price of your vehicle under each definition because the values for both will be strikingly different.

In order to effectively do this, you should research multiple pricing guides to begin the process

• 1
• 2
• Next Page >>