The most important question you should ask next is, how much is your car worth? With this in mind, remember that you’re after your car’s trade-in value or wholesale value, not the retail value. There are many books and online guides that you can use for a rough estimate.

Keep in mind that since car dealers mean business, they will most likely not offer you the exact value of your car. Most dealership will offer only about eighty five to ninety percent of the car’s actual value. So to give you an idea of the actual value of the car, you can visit different dealerships, average their offers, and add on ten to fifteen percent. The result should be, more or less, the value of your car.

You will get lower amount if you trade-in as compared to selling your car in a private-party sale. But with trade-in, you can save time and energy. So think of trade-in as the lesser of two evils when it comes to giving you headaches. It is about convenience. No paperworks, no direct contact with customers, and no ads to worry about. So if you don’t have time to spare or if you don’t have skills in marketing, then it’s best to trade-in. You can also have tax benefits if you are going to buy a vehicle at the same time. The formula is:

Trade-in value – Price of the new car = Payable sales tax

This means that if the trade-in value of the car is $5,000 and the price of the new car is $10,000, you are required to pay the sales tax on the $5,000 difference.

On the other hand, selling your car in a private-party sale guarantees bigger cash. The down side is, this will take time and in most cases, money. The first step is for you to determine your car’s worth. You can check magazine ads on used cars and the Internet to help you determine the local market pricing. Once you’re done with the first step, the next thing you need to do is publicize or advertise your car. Most private-party cars are sold through local used car publications. Start here and advertise in multiple sources later on. After you have placed your ads, expect phone calls, schedule hassles, and competing offers. And when you finally have a buyer, you will have to transfer title and registration and cancel your insurance on the car.

Selling in a private-party sale is a straining task. But if you have contacts, time, and patience, you will benefit more in selling your car yourself.

Internet prices versus actual selling prices
- Unlike actual selling prices, Internet prices does not include state and local sales tax, rebates, incentives, and some other charges. Prices also vary by city and state and date of purchase. So make sure you check on these variables before purchasing anything on the Internet.

Dealer invoice pricing
- Also known as factory invoice, dealer invoice pricing is the bill that a dealer pays to the manufacturer of a vehicle. For profit, the dealer then sells that vehicle for a higher price.

Advertising assessment fees
- These are charges that a dealer pays for local group advertising and applicable incentive programs.

Invoice prices and dealer costs
- Dealer cost includes invoice price and other expenses that a dealer pays on the process of selling a vehicle. Expenses such as vehicle insurance, advertising, and sales commissions.

Destination charge
- This is a charge from manufacturer to dealer and dealer to buyer. Charges from manufacturers to dealers vary on the model. But unlike destination charges from dealer to buyer which is fixed and non-negotiable, destination charges from manufacturer to dealer solely depends on the manufacturer.

MSRP
- Manufacturer’s suggested retail price is the manufacturer’s recommended price for a vehicle.

Customer incentives
- It is a manufacturer’s discretion to give customer incentives. Manufacturers usually give this incentive when there is a higher supply than demand. It is usually through price reductions and rebates or special financing.

Rebates
- These are refunds that manufacturers send to their customers. It can be national or regional and is either mailed to a customer’s home address or deducted from the purchase price. Sales tax, however, is charged on the fulls amount of the vehicle and not on the price after the rebate.

Special financing or leasing
- An alternative to rebate, special financing or leasing is subject to a customer’s credit qualification and on the manufacturer’s finance company.

Trade Value
- For trade-in values you can use online resources such as kbb.com. However, trade-in vary per dealer. Some of the things that need to be considered for trade-in value include car condition, the local market, and mileage.

Trade-in versus selling
- If you choose to sell your vehicle yourself, you can get a price close to retail. The downside here is that you have to do all the work such as paying off the amount of loan left and transferring the title to your buyer. On the other hand, if you choose to trade-in, you will most likely get less retail for your vehicle. The advantage here though is that you don’t have to handle the entire process yourself. The dealer will take care of the loan payoff and the transfer of title. Plus, some states offer tax advantages for trade-in vehicles.