How to Sell Your Used Car
Selling your own used car can be a confusing process. The temptation is often to hand the car over to a dealership, but doing this can cut a seriously deep hole in your profits. Even if you're planning on buying from the dealer, a used car trade-in usually values the old car at significantly less than the actual resale value. To make a long story short, going through the hassle of selling your used car by yourself can be much more lucrative than the alternatives.
In order to sell your used car, you'll need to get some things ready before you begin. These tips are assuming that the car is paid off and that you own the title. If you're still paying off the car and the dealership owns the title, the process is slightly different and involves a transfer of the car loan. This process will be discussed in a later blog.
Determining the value
First and foremost, you'll have to evaluate the price of your vehicle, and decide how much you want when you sell it. Many, many people have dreams of making a huge profit, and they simply sticker-price their cars too high. Then again, keep in mind that the vast majority of cars that are privately sold don't go at the sticker price- they go for amounts that are significantly lower thanks to the bargaining process. So, the bottom line is to choose a price that falls somewhere between the car's actual value and the amount you wish you could get, but are willing to bargain down from.
When setting a price, it can help to look up your car's blue book value. The Kelley Blue Book (http://www.kbb.com/) is a widely-accepted price catalog for used vehicles. If you visit the site, it will ask you questions about your vehicle's year, make and model, as well as any special features you may have added or what kind of condition the car is in. The blue book will then return a range of prices for you: the one labeled 'resale value' is what you should aim for when selling your car to another private party.
Keep in mind that although a car's blue book value is listed at a certain amount, that doesn't mean you should expect to get that amount or higher. Blue book values vary widely according to many factors that aren't included in the initial calculation. For example, in some states an SUV is much more in demand, and will sell much faster and at a higher price than a comparable sedan. A lot of the success of your sale will depend on your vehicle's desirability and what consumers are looking to buy.
Advertising
Once you've settled on a price for your used car, it's time to advertise. If you're trying to sell your vehicle fairly rapidly, then you should expect to spend some money in this area. Sellers who aren't in a hurry often just park the car on the street outside with a sign in the window, and chances are good that someone will eventually call you. But if you're rushed, or if you are hoping to reach a wider range of buyers with a greater variety of budgets, then advertising is extremely important.
In most areas, the Sunday newspaper has the largest classified section, although this will differ in various cities. Find out what day of the week your newspaper runs the largest car classified section, and list your automobile on that day. People who are in the market for a used car will be buying the paper that offers the most listings, and if everyone's looking for cars on Friday buying a Monday ad is just a waste of your money.
You should also look into auto classifieds, which are often free circulars that are given out on newsstands or tucked into the Sunday newspaper. Auto classifieds often cover a range of cities in the area and can expose your car to even more sellers. For best results, run ads for two to three days in a row, take a day off, and then if you're still waiting for responses run the ad again. Some papers even offer a discount to those who didn't sell their car the first time around and who are returning for a second run of the same ad.
Finally, it doesn't hurt to spread the word in smaller ways. Post fliers at your local supermarket with a photo and an honest description of the car, along with your asking price and telephone number. Tell your friends that you're trying to sell a car- almost everyone knows someone who's in the market for a new vehicle.
Preparing for buyers
Now that you're getting phone calls about your used car, you should be prepared for people to come and see it and probably test-drive it. Keep in mind that many buyers operate on a moment's notice, so you should have the car ready for prospective buyers to check out. If possible, you should either make sure someone is home at all times to field calls or you should post what hours you are available in your classified ad. A seller who isn't willing to work with prospective buyers is not a seller.
A quick side note: I was in the market for a car about a year ago, and I found exactly what I wanted in a local newspaper. I called the seller and we set up a time for me to see the car that evening at 5 pm. I went to the bank during my lunch hour and withdrew the cash in the amount he was asking, and showed up at his house precisely at 5 (after having left work early in order to make it). He wasn't there. His roommate informed me that he had walked down the street to the bar for happy hour, and hadn't said when he would be back. I looked longingly at the car, sitting parked in the driveway, and then went home.
Two weeks later, the seller was leaving messages on my machine asking if I was still interested. The truth is, I went out and bought another car that weekend. This proves the point: buyers are expecting a certain level of honesty and courtesy from the seller, and they are in effect your customers. Leaving someone hanging who is about to pay you several hundred dollars in cash is NOT a good idea.
Once buyers start showing up to look at your car, be prepared to have it test-driven and to answer any questions regarding its condition and history that they may have. It helps to have your mechanic look over the car before you sell, and to have their report printed out to show to buyers. Many buyers will ask if they can take the car to their own mechanics before buying, and this is becoming an acceptable practice, so you should be open to the idea. As long as you're being honest about the car's condition, it shouldn't be a problem. If you do get a buyer who hard-balls you about the car or claims that they are finding problems you know don't exist, you have every right to refuse to sell to them.
Similarly, if you aren't comfortable sending your car out for a test drive with a potential buyer, there is no law that says you have to do so. You are sending these buyers out in your own vehicle; there is no reason not to be careful. Make sure that all test drivers have a valid driver's license before they take off, and call your insurance to make sure that your policy covers other drivers operating your vehicle.
The sale
Eventually, you'll find a buyer who offers a price that is approaching what you want for the vehicle. Feel free to negotiate and try to get a higher amount; the buyer will be doing the same thing trying to get you to lower it. It's a good idea to have a set amount that you absolutely must get so that you can end negotiations at a certain point and not feel bad when that buyer walks away.
It's best when selling a car to a private party to accept cash only for the sale. Personal checks can lead to nightmares- if you're silly enough to take a check and hand over the keys, you may find that by the time the check is returned for insufficient funds the buyer (and your car) are long gone. Some buyers may prefer to pay via money order so that they can have printed receipts, and that is perfectly fine as long as the money order is legitimate.
You should always write the buyer a receipt and/ or a bill of sale when the cash is exchanged. A bill of sale can be a simple piece of paper upon which you print the make, model, year and VIN of the car, along with the purchase price and the date. It is often helpful to add "this car is being sold as is, and all sales are final," or something to that extent. Both you and the buyer should sign the bill of sale before the keys are handed over. If you're not sure how to make a bill of sale, visit your state's Department of Motor Vehicles website; they often have a blank form that you can print out for use in such a situation.
When you hand over the car, remove the license plates. The buyer has a grace period before they have to register the car in his or her own name. For your own protection, it can be wise to notify the DMV that the vehicle has been sold. That way, if the new owner is involved in an accident or incident before they get the car registered, it will not be your responsibility in any way.
And that's about it. If any problems should arise after the sale- for example, if the buyer contacts you and is not happy- it is really up to you how you handle it. If you stated in person and on the bill of sale that the sale was final, you are not liable for any problems that arise after the sale is completed. If you've had the vehicle checked out by a mechanic, or if the buyer has done so, there shouldn't be any immediate problems and chances are good you won't hear from the buyer again.
Of course, there are always exceptions. One more case from my personal experience: I once bought a used station wagon from a gentleman who was selling it through the classifieds. I test-drove the car, had my boyfriend do the same, and everything seemed fine. I bought it the next day, and the bill of sale stated that the sale was final. But by the time I got home, the brakes were hardly working and the car erupted coolant all over my driveway and overheated so badly I was honestly afraid it was going to catch on fire.
I felt, forgive the expression, utterly screwed. I called the seller anyhow, and was amazed when he told me that he would take the car back immediately- no questions asked. We drove (very slowly) back to his house and he gave us back the cash and took the keys. He then had the car fixed by his mechanic and offered me first crack at buying it once it was done. I chose not to, since I'd found something else by then, and he was able to sell it for two hundred dollars more than I had paid because of the recent check-up. So sometimes, it pays to be a compassionate seller.
If you handle it correctly, selling a used car doesn't have to be a stressful or scary experience. Some people may still decide that it's not worth the work involved and choose to sell to a dealer, and that's fine too. But if you're looking to make some profit off your vehicle, selling privately can be a great way to achieve it. Just use your head.
-by bjp
