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Trade-In Value
Definition
The amount a dealer credits you for your current vehicle when purchasing a new one.
Explanation
Trade-in value is typically less than private party value because the dealer needs to recondition and resell at a profit. Trade-in offers are negotiable and depend on condition, age, mileage, and market demand.
Getting quotes from multiple dealers and checking Kelley Blue Book helps. Negotiate trade-in and new car price separately.
Example
Car's private party value: $10,000. Dealer trade-in offer: $8,000. Accept $8,000 (convenient) or sell privately for $10,000 (better price).