10 Steps to Selling Your Car
Here are 10 simple steps that may help you sell your car.
I have tried to cover all the bases, from pricing, advertising and negotiating.
And keep this a short and easy-to-follow process.
Step 1: Know the Marketplace
Is your car going to be easy to sell? Is it a hot commodity, are there many similar vehicles?
Or will you have to drop your price? Maybe look at other ways to sell it?
Here are a few general 'rule of thumb' to answer the above questions:
* Family sedans, while unexciting to many, are in constant demand by people needing basic, inexpensive transportation.
* The sale of convertibles and sports cars is seasonal. Sunny weather brings out the buyers. Fall and winter months will be slow.
* Trucks and vans, used for work, are steady sellers and command competitive prices. Don't underestimate their value.
* Collector cars will take longer to sell and are often difficult to price. However, these cars can have unexpected value if you find the right buyer.
Your first step is to check on-line classified ads to see how much others are asking for your type of car.
Most websites have a Vehicle Locator and allow you to search with specific criteria. For example, select the year and trim level of your car and see how many similar cars are currently on the market.
Take note of their condition, mileage, geographic location and selling price so you can list your car at a price that will sell it quickly.
Step 2: Price Your Car Competitively
Once you have surveyed the on-line classified ads, use
Edmunds.com True Market Value (TMV®), Kelley Blue Book and
Autotrader.com pricing to determine the fair value of your car.
Edmunds.com TMV prices are adjusted for mileage, color, region, options and condition.
There are always some exceptions to the rules of pricing, so you should follow your intuition. And be sure to leave a little wiggle room in your asking price.
Ask for slightly more money than you are actually willing to accept. If you want to get $12,000 for the car, you should list the car at $13,500. That way, if you get $13,500 — great! But if you have to go lower, it won't be a terrible loss.
You may have noticed how creative used car dealers get in pricing cars. Their prices usually end in "995," as in $12,995. Are we not supposed to notice that the car basically costs $13,000? There is a lot of psychology in setting prices.
A product that doesn't sell well at $20 might jump off the shelf at $19.95.
On the other hand, as a private party seller, you don't want to look like a car dealer. Therefore, you might want to take a simple approach and set your price at a round figure such as $12,750 or $12,500.
Step 3: Give Your Car "Curb Appeal"
When people come to look at your car, they will probably make up their minds to buy it or not within the first few seconds. This is based on their first look at the car. So you want this first look to be positive. You want your car to have "curb appeal."
Before you advertise your car for sale, make sure it looks as clean and attractive as realistically possible. This goes beyond just taking it to the car wash. Here is a to-do list that could help turn your heap into a cream puff:
* Make sure it is washed, waxed and detailed.
* Make sure your car is both mechanically sound and free from dents, dings and scrapes.
* Consider making low-cost repairs yourself rather than selling it "as is."
* Shovel out all the junk from the inside of the car. When prospective buyers go for a test-drive, you don't want them to feel like they've walked into your messy bedroom. Let them visualize the car as theirs.
* Wipe the brake dust off the wheel covers and clean the tires with a tire gloss product.
* Thoroughly clean the windows (inside and out) and all the mirrored surfaces.
* Wipe down the dashboard and empty the ashtrays.
* Have all your maintenance records ready to show prospective buyers.
* If the car needs servicing or even a routine oil change, take care of that before putting it up for sale.
* Have your mechanic check out your car and issue a report about its condition. You can use this to motivate a buyer who is on the fence.
* Order a Carfax report and show it to the buyer to prove the car's title is clean and the odometer reading is accurate.
Step 4: Where to Advertise Your Car
Now that your car is looking great and running well, it's time to advertise it for sale. Traditionally, people advertise in newspaper classified ads. These ads can be expensive, but they get results. On-line classified ads, such as the
Edmunds.com Used Vehicle Locator, are becoming increasingly popular. On-line ads are particularly effective with hard-to-find or collector cars. In most cases, on-line classifieds reach a geographically wider area of buyers.
Here are the main markets for advertising used cars:
* On-line classified ads such as those on
Edmunds.com * Daily newspaper classified ads
* Weekly "shoppers" and giveaway newspapers
* Bulletin boards at your office, a local supermarket or a college campus
* Word of mouth — tell your friends and family you have a car for sale
* Put a "For Sale" sign in the car window
Creativity is required when it comes to advertising. Think of unusual places to put ads (skywriting is probably too expensive), and you will get results.
One last word of advice about advertising: if you run an expensive classified ad, be sure you are available to take phone calls from possible buyers. Many people won't leave a message for a return call. So answer the phone — and be polite. Creating a good first impression is the first step to getting buyers to come and see the car in person.
Step 5: Create Ads That Sell
When creating "For Sale" signs or putting a classified ad in the paper, you have an opportunity to show how eager you are to sell the car. This can be done by inserting the following abbreviations and phrases:
Must Sell!: This often means the seller is leaving town and needs to dump the car at a fire sale price.
OBO: This stands for "or best offer" and it indicates that you are willing to entertain offers below the stated price. This usually means you are eager to sell the car.
Asking price: This also communicates the feeling that you will negotiate, but it is one notch below OBO on the eagerness scale.
Firm: This word is used to rebuff attempts to negotiate. It indicates that you aren't in a hurry to sell the car — you are most interested in getting your price.
Think about what you are telling people when you phrase your ad. Little words convey a lot. Besides the price, your ad should also include the year, make, model and trim level of the car you are selling along with the mileage, color, condition and popular options.
Step 6: Showing Your Car
Keep in mind that when you sell your car, people will also be evaluating you. They will be thinking something like, "Here's the person who's owned this car for the past few years. Do I trust him/her?" Make the buyers feel comfortable. They will probably be uneasy about making a big decision and spending money. Put them at ease and answer their questions openly.
Potential buyers will want to test-drive the car. If in doubt, check to make sure they have a driver license. Ride along with them so you can answer any questions about the car's history and performance. Also, they may not know the area, so you might have to guide them.
There are many unexpected bumps in the road that can arise while selling a used car. These will be handled easily if you are dealing with a reasonable person. So, as you are contacted by prospective buyers, use your intuition to evaluate them. If they seem difficult, pushy or even shady, wait for another buyer. With the right person, selling a used car should be simple.
Some sellers feel uncomfortable about having buyers come to their house to see the car. However, you can generally screen buyers on the phone. If they sound suspicious, don't do business with them. If you don't want people knowing where you live, arrange to show the car at a park or shopping center near your home. However, keep in mind that people will eventually see your address when you sign the title over to them.
Some buyers will want to take the car to a mechanic to have it inspected. If you have an inspection report from your mechanic, this might put their doubts to rest. However, if they still want to take the car to their mechanic, this is a reasonable request. By now, you should have a feeling for the person's trustworthiness. If you feel uncomfortable or have reason to think they will steal the car, decline the offer or go along with them.
Be ready for trick questions such as, "So, what's really wrong with the car?" If you get this, refer them to the mechanic's report or invite them to look over the car more carefully.
Step 7: Negotiate For Your Best Price
If a person comes to look at the car and it passes their approval after a test-drive, you can expect them to make an offer. Most people are uncomfortable negotiating, so their opening offer might take several forms.
"I like the car, but…." This is the softest way to negotiate on the price. They may not even state that the price seems too high. If they say, "I like the car, but…" and then lapse into uncomfortable silence, you might consider an appropriate response. If you really want to move the car, you could say, "How much would you be willing to pay?"
"What's your best price?" This is a more direct way to probe the seller to find out how much he or she will come down. If you get this from a prospective buyer, don't seem too eager to reduce your price.
"Would you accept…?" Now we're getting somewhere. This buyer has thought it over and is making an offer. But the offer is being presented in a polite manner designed to allow for a counter offer.
"Take it or leave it." This buyer is making an offer that supposedly leaves no room for a counter offer. In reality, this buyer might be bluffing. Still, they are sending a message that they are close to their final price. The only way to know for sure whether it really is a "take it or leave it" offer is to leave it — and let them leave. They may return tomorrow ready to pay your price.
The above are just a few of the openers you might encounter. Think of your responses ahead of time so you won't be caught unprepared. In general, it's a good idea to hold to your price when your car first goes up for sale. If you don't get any buyers right away, you'll know you have to be flexible about the price.
Step 8: Handling Complications
In some cases, you might reach an agreement with a buyer that is contingent on performing repair work on the car. This can lead to misunderstandings down the line, so avoid this if you can. The best thing to do is have your car in good running order while being fully aware of any necessary repairs. If you state clearly in your ads that the car is being sold "as is," you can refer to this statement when it's time to close the deal.
Still, a trip to the prospective buyer's mechanic might turn up a new question about the car's condition. What to do?
This must be handled on a case-by-case basis. If the repair is needed, and you trust the mechanic's assessment, you could propose reducing the agreed-upon price by all, or part, of the amount for the repair. If the repair is questionable, but the buyer is insistent, split the difference, or have the car taken to your mechanic for further evaluation.
Remember, the older the car, the more a mechanic is likely to find. At some point, you have to draw the line. You may have to say to the buyer, "True, this work could be done. But the car drives well as it is. And the proposed repair isn't addressing a safety concern." After all, a used car — particularly an elderly one — isn't expected to be perfect.
Step 9: Finalize the Sale
By Philip Reed, Senior Consumer Advice Editor
Email
Rules governing the sale of motor vehicles vary somewhat from state to state. Make sure you check with the department of motor vehicles (DMV) in your state, and keep in mind that much of the information is now available on DMV Web sites.
When selling your car, it's important to limit your liability. If someone drives away in the car you just sold, and they get into an accident, can you be held responsible? There are two ways to deal with this concern.
Once you have the money from the sale (it's customary to request either cash or a cashier's check), record the odometer reading and sign the car's title over to the buyer. In some states, the license plates go along with the car. A new title will be issued and mailed to the new owner. Additionally, in most states, a release of liability form can be downloaded from the DMV web site. Fill this out, along with the car's mileage, and mail it in as soon as the car is sold. This establishes the time at which the car left your possession.
But what if you still owe money on the car, and the bank is holding the title? One way to deal with this is to conclude the sale at the bank where the title is held. Call ahead and have the title ready. Then, once money has changed hands and the bank has been paid the balance of the loan, sign the title over to the buyer.
In some cases, however, an out-of-state bank might hold the title. In this instance, it is recommended that you go with the buyer to the DMV and get a temporary operating permit based on a bill of sale. Then, after you pay off the balance of the loan with the proceeds from the car sale, have the title mailed to the new owner. Sign it over to the new owner and the transaction is complete.
Finally, remember to contact your insurance agent to cancel your policy on the vehicle you have sold (or transfer the coverage to your new car).
Before your car drives away for the final time, take a last look through the glove compartment, the trunk and under the seats. You might find some long forgotten treasures you misplaced years ago.
Step 10: After the Sale
In most states, the condition of a used car for sale is considered "as is" and no warranty is provided or implied. Therefore, if the car breaks down after you have sold it, you are under no obligation to refund the buyer's money or pay to have it repaired. If you have sold a car to someone who took it for inspection at a garage and the mechanic found nothing wrong with it, you have done all you can to protect yourself and the buyer.
The best way to feel peace of mind after selling your used car is to make sure you did everything correctly. This means being open about the condition of the car before the sale and timely and complete in transferring DMV paperwork after the sale.
When done correctly, selling a used car can be a win-win situation. You have turned your used car into cash and provided reliable transportation for the next owner. Focus on the benefits to both parties and you are likely to have a smooth and profitable experience.
