Automotive

Trade in vs sell to used car dealer

  • Last Updated:
  • Jun 10th, 2018 12:55 am
[OP]
Jr. Member
Jan 4, 2014
122 posts
50 upvotes
SCARBOROUGH

Trade in vs sell to used car dealer

I visited several honda dealership for trade in and buy a car. Each dealership said different trade in price. So I am considering to sell to local used car dealer. I visited 2 used dealership and they offered same price as top trade in price from Honda dealership.
Do you think which one is better, trade in to honda dealership or used dealership?
16 replies
Deal Expert
Jan 15, 2006
19673 posts
20110 upvotes
Richmond Hill
Trading at the dealer will save you taxes. Selling to the used car lot will not.
[OP]
Jr. Member
Jan 4, 2014
122 posts
50 upvotes
SCARBOROUGH
EP32k2 wrote: Trading at the dealer will save you taxes. Selling to the used car lot will not.
it is pretty same. i got offers 10000 trade in and 11500 from used car lot.
Deal Addict
Mar 22, 2010
3712 posts
1636 upvotes
ddash80 wrote: thanks but the problem is every new car dealers gave me different offers from $8000 to $10000. and they refused more discount.
Dealers don't get to refuse. You just gotta push harder.
Deal Addict
User avatar
Jun 10, 2011
2186 posts
722 upvotes
Etobicoke
Why not sell privately yourself.
Sr. Member
Oct 2, 2017
832 posts
588 upvotes
Dealers don't buy cars. They call their "guy" at the auction and ask who much they are willing to pay for car x/y/z. Auction guy obviously wants to make money, so for a car with 15k he might quote 12k. If dealer really wants your business they will take a 500$ loss (well within their margins of course) and offer you 12.5k.

Basically trade-in or sell to dealer is the same progress, however if you trade in your don't pay taxes on your trade in value. If the Car you are buying is 12k and your trade in in 3k, then you only pay tax on the difference (12k-3k) == 9k. If you sold the car yourself you will be on the hook for the sales tax on 12k.

So just trade in.
I'll see you at the top, cause the bottom is too crowded
Deal Addict
Jan 1, 2013
2079 posts
1379 upvotes
Durham
ddash80 wrote: it is pretty same. i got offers 10000 trade in and 11500 from used car lot.
But what is the price of the new car? If its break even or saving, just trade in to save yourself the hassle.

Assuming $25k new car
$25,000 + tax = $3,250 in taxes
$25,000 - $10,000 trade = $15,000 + tax = $1,950 in taxes

You save $1,300 in taxes by trading in, so why go through the hassle of selling to a used car dealer and then having to find your way back to Honda for the new car?
Jr. Member
Apr 19, 2017
197 posts
72 upvotes
Kkhan15 wrote: But what is the price of the new car? If its break even or saving, just trade in to save yourself the hassle.

Assuming $25k new car
$25,000 + tax = $3,250 in taxes
$25,000 - $10,000 trade = $15,000 + tax = $1,950 in taxes

You save $1,300 in taxes by trading in, so why go through the hassle of selling to a used car dealer and then having to find your way back to Honda for the new car?
He pockets $200
Deal Addict
User avatar
Jan 10, 2004
4646 posts
2216 upvotes
Edmonton
plans4canada wrote: He pockets $200
If you're buying another car from a dealer, you want to trade it in and save the tax.

Everyone says sell privately, but I tried that and it was a total waste of time. Just lowballers and timewasters. Yes that depends on the vehicle, but its harder to sell privately the more expensive the car as buyers need financing.

I value my time and stress alot more than making $200.
Deal Fanatic
Jun 11, 2005
8614 posts
2380 upvotes
Mississauga
U4IA wrote: If you're buying another car from a dealer, you want to trade it in and save the tax.

Everyone says sell privately, but I tried that and it was a total waste of time. Just lowballers and timewasters. Yes that depends on the vehicle, but its harder to sell privately the more expensive the car as buyers need financing.

I value my time and stress alot more than making $200.
In most cases trading the vehicle in is your best bet for less hassles.
Jr. Member
Apr 19, 2017
197 posts
72 upvotes
U4IA wrote: If you're buying another car from a dealer, you want to trade it in and save the tax.

Everyone says sell privately, but I tried that and it was a total waste of time. Just lowballers and timewasters. Yes that depends on the vehicle, but its harder to sell privately the more expensive the car as buyers need financing.

I value my time and stress alot more than making $200.
He said used car dealer is giving him $1500 more. So there's no different than going straight to the dealership he will buy new car. Using his numbers, he nets $200 more.
Sr. Member
Sep 12, 2003
658 posts
100 upvotes
Toronto
Should put that no on paper, bring it back to dealer and match it, lol.
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