When buying a new car, you may be thinking about trading in your existing car and using the equity towards your purchase. In this article, we have explained what part exchanging means, outlined the important information you need to know and whether it’s the correct choice when selling your car.
Part exchanging is the process of ‘trading in’ your old car when buying a car by offsetting the value of your current vehicle against the one you’re purchasing. Traditionally, you may have taken a car to a dealership where they would deduct its value from a new vehicle or use it as a finance agreement deposit. Dealers may estimate the trade-in value of your car online by entering your vehicle’s details and using data to provide a price. Similarly, you can get a free car valuation with webuyanycar by entering your registration plate at the top of the page.
A part exchange scheme allows you to trade in your current car and put its value towards the cost of a newer model.
The dealer will evaluate your vehicle and offer you a ‘trade-in’ price for it. This amount won’t be paid to you in cash, but instead can be applied as a discount on another car in the showroom.
If you sell your car privately, you’ll have to contend with creating listings on multiple car advertising websites and meeting prospective buyers to showcase your motor. This process can take weeks, months (or longer) and will eat into your free time. Even then, there’s still no guarantee you’ll find the right buyer.
However, with a part-exchange scheme, once you have agreed to trade in your car, you can drive to the dealership in your old motor and leave in a newer model!
Whether you’re buying a new or used car, trading in your old car through a part-exchange scheme can make it easier to cover the cost of the newer model.
A car dealership will be more focused on making a profit than most private buyers. Therefore, the trade-in value they offer will often be lower than what you could get on the private market.
If you enter into a part-exchange agreement and trade in your car for less than its true value, you’ll also have less to put towards your next motor. Even if you’re prepared to haggle, the dealer may be reluctant to offer you much of a discount on your next purchase, as this will reduce their profit.
In short, by choosing to part-exchange, you could get a worse deal on not one - but two transactions!
If you want your money to go further, your best option would be to sell your old car separately through a different avenue, then return to the dealer with the cash to put towards your chosen model.
A used car must have been maintained to a high standard to be accepted for an approved used car scheme. Your car could be rejected if it has a high mileage, a missing service history or superficial damage. (A car that has been written off will certainly be rejected!)
Other used car schemes tend to have less stringent requirements. However, if your car is in particularly poor condition and has a string of mechanical faults, you may struggle to find a dealership that will buy it from you.
If you’re keen to get behind the wheel of a newer motor as soon as possible but don’t have the funds to buy the car outright with cash, you might consider selling your old car through a part exchange scheme to get a discount on a newer model.
The process should be relatively straightforward. (Just be aware that you might not get the best price for your old car with this method.)
Although selling your car privately involves more legwork, taking this avenue could allow you to raise more cash towards your next purchase.
Alternatively, you could get a great deal by selling your car to a leading car buying service such as webuyanycar. Selling with webuyanycar is simple, hassle free - and true to our name, we’ll buy any car, regardless of its condition.
We have 500+ locations across the UK and with our Immediate Payment option, you can get the money in your bank in 15 minutes or less! We can even help you settle any outstanding finance. (See our terms and conditions for more details.)
It is likely that your part exchange value will be lower than what you could get for it on the private market.
Therefore, we would recommend getting a free car valuation before visiting the dealership to help you gauge whether you’re being offered a good part exchange deal.