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How To Sell Your Used Car: Privates Sales, Dealerships And More

5-minute readJanuary 12, 2022

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If you’re looking for a new car, you might also wonder how to sell a used car and make the most money. There are several ways to sell your current vehicle, but the best way to sell a car depends on if you still have a loan and how much patience you have. This guide reviews the main methods people use to make money from their vehicles so that you can decide which is best for you.

What You Need To Know Before You Sell A Used Car

You are most likely here because you are wondering, “How do I sell my car?” The first step is to learn how much your car is worth. You can look up your vehicle’s value easily by visiting Kelly Blue Book or Edmunds, but it can be confusing to tell the difference between private party, trade-in and retail values. Here is how each value is used:

  • Trade-in value is the amount of money a dealership may offer you if you’re trading your vehicle in during a purchase of a new car. Dealers use this value to determine how much they can recover from the car if they list it on auction or try to sell it on their lot.
  • Private party value is a fair value if you choose to sell your car to a private buyer. You have much more room to negotiate on price when you sell privately because the value is somewhere between what you’d receive in a trade and the retail value.
  • Retail value is what a dealer would sell the vehicle for on the car lot. Dealerships need to make money, so they try to purchase used cars for less than they plan to list them for. This way when they sell the car, they are able to make a profit.

If you choose to sell to a private party, knowing the ins and outs of how to sell a car helps ensure the buyer can take possession of the vehicle and register it under their name. You’ll need your pink slip, a bill of sale, maintenance records and other documents to complete the sale. Check with your Department of Motor Vehicles to see exactly what paperwork you will need to provide. 

You don’t need as many documents when trading in your vehicle or selling it to a dealer because they do all the paperwork on your behalf. Let’s go through the primary ways to sell your car.

1. Do It Yourself And Sell Privately

If you’re wondering how to sell your car for the most money, this is it. The advantage of selling to a private party is that you can control the pricing in your favor, but you’ll also be doing all the legwork to make that happen. You’ll need to vet potential buyers, avoid scammers and provide the prospective buyer with all the information and paperwork they need to register the vehicle. For people who can handle the hassle, this may be the best way to sell their car.

If you don’t know how to sell a car privately, your Department of Motor Vehicles is a great resource. You can obtain all the information and forms needed to complete the sale by visiting your DMV’s website or asking in person. When you list the vehicle ad, it’s important that you state you’re selling a car as-is so buyers don’t assume you’re liable for anything that may be wrong with the vehicle. 

Also, consider that selling to a private buyer may be more complicated if you still owe money on your loan. You may need to take a couple of additional steps to pay off your loan and receive a title before you can complete a sale. It’s important to keep in mind that private buyers may not want to jump through these extra hoops.

2. Sell Your Car To A Dealer

If you’re thinking, “I’ll sell my car to a dealer,” you’re probably looking for convenience. Selling your car to a dealer eliminates a lot of the hassle. If you’re selling a car with a loan, the dealership handles the majority of the paperwork, including getting the title transferred and paying back your bank. For some people, the convenience of this transaction is worth passing up a potential higher profit.

The downside is that the dealer often uses the trade-in value of your car to determine the offer. It’s more difficult to negotiate the selling price of your vehicle when working with a dealership because they want to maximize their potential profit while insulating against a loss. For example, the offer you receive will be based on the value of similar cars in your area and how easily they sell. Should your vehicle remain on the dealer’s lot for a long time, the dealership will want to be assured it can take it to auction and receive its money back.

Trade-In Your Car For Another At The Dealership

How trading in a car works is that the dealer applies the value of your car toward your new purchase. This lowers your new loan amount, and many people use their trade-in as a form of down payment to reduce their monthly payments. If you’re trading in a car that’s not paid off, pay attention to how this impacts the loan. If you owe more money than the trade-in value, the difference will be rolled into your financing.

3. Get An Instant Cash Offer

Getting an instant cash offer may be the most convenient way to sell your car because you can do it from the comfort of your home. It’s important that you provide accurate information when you go this route because your offer depends on the condition of your car. Being truthful will help you avoid complications later and ensure the offer is guaranteed. 

When you apply for an instant cash offer, you need to enter the vehicle identification number (VIN) and mileage before answering additional questions about the vehicle’s features and condition. Once you provide all of the required information, you’re offered payment for your vehicle in exchange for arranging a pickup or delivery.

One of the main benefits of selling your car this way is that you don’t need to haggle over the sale price. The offer is normally more than you can expect for a trade-in, and you don’t need to deal with private buyers, as much paperwork and other inconveniences. 

The Bottom Line: It Can Be Easier To Sell Your Car Than You Think

The best way for you to sell your vehicle depends on how much of the legwork you’re willing to do and whether you still have a loan on the car. Many people are turning to instant cash offers to simplify the process and get a higher profit. To learn more about how to sell your car without leaving money on the table, review these steps to selling a car.

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