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Selling a car
Newton
Registered User regular
Registered User regular
I'm getting ready to sell a car, which is something I've never done before. It is a 2001 VW Jetta, and according to the Kelly Blue Book, it is worth about $7800 in good condition. However, it needs new tires and is due for its 80,000 mile tune up. Should I take care of that stuff before I sell it, or just ask for less on the car? I was thinking of just putting it up for sale as is and asking $7200, maybe willing to drop down to $7000, but if it makes it significantly harder to sell the car, I'd be willing to do at least a little work on it before hand.
Secondly, I don't have the title for the car in hand. I still owe money on the loan, so the bank has it. How do you handle this when selling between private parties? I've noticed in a lot of car ads, that people mention having the title. Is it going to scare buyers away if they have to pay for the car without getting the title? Doesn't that need to be signed over to show the change in ownership?
What is the best way to accept payment? I don't really trust a personal check from a stranger and money orders sound like just a scam now, but that is a lot of cash to be carrying around. Especially when you are doing business with a total stranger.
I'd also appreciate any general advice anyone has to offer on this. Like I said, I've never done this before, so I'm sure there are things I'm not even thinking about.
Secondly, I don't have the title for the car in hand. I still owe money on the loan, so the bank has it. How do you handle this when selling between private parties? I've noticed in a lot of car ads, that people mention having the title. Is it going to scare buyers away if they have to pay for the car without getting the title? Doesn't that need to be signed over to show the change in ownership?
What is the best way to accept payment? I don't really trust a personal check from a stranger and money orders sound like just a scam now, but that is a lot of cash to be carrying around. Especially when you are doing business with a total stranger.
I'd also appreciate any general advice anyone has to offer on this. Like I said, I've never done this before, so I'm sure there are things I'm not even thinking about.
Newton on
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If you still want to sell, clean it up real good (but don't put more money into it, unless it's a safety issue e.g. way too bald tires) and find the going price and put an add in the paper (or the nets, but newspaper is good). Then wait. If you priced your car well it will move. Price it closer to what you're "willing to take" rather than being cute and pricing it $1K over what you'd take. Maybe price it a couple of hundred more than you'd take so you have room to give the buyer "a deal". When you have a buyer, meet him/her at their bank and get a cashier's check from them (it's just like cash so don't lose it, take a friend if that will make you feel more comfortable). Write up a bill of sale (receipt) and have the buyer sign it (not necessary, but doesn't hurt). Get a notice of title transfer for from the DMV/DPS and fill it out and send it in. Pricing it well will reduce the time you're (1) holding a depreciating good (2) paying for car insurance on it and (3) paying for advertising. If you're going to buy another car, consider trading in your current vehicle as you will get a sales tax benefit.
What would you do if your check engine light is on and supposedly it's a failed catalytic converter (kind of an expensive replacement)? It's neither a safety nor an operational concern, but it will probably scare away buyers. This is the decision I have to address on my car.
Wait, can you explain how this works?
Cat's aren't expensive to replace. The labor for automotive servicing however, will run up the cost. If you have a friend with some knowledge and some tools, you could probably do it yourself. But since you don't know for sure that it's the cat, you might want to at least send it for a full diagnostic though.
When you're buying a new car, the dealership will (usually) offer you some amount of money for your old car as a trade-in... from my impression it's usually less than what you would get if you actually sell it yourself (since they're usually going to either try to sell it used themselves, or sell it to a 3rd party used car dealer), and you have to negotiate a good deal with them, but it's certainly far easier than trying to sell it yourself through newspaper ads
engine light on a jetta? maybe it's not the cat and its just a failed O2 sensor (very common on 200X Jettas and Golfs), those lights also come on when the gas cap is improperly seated (i'm sure you checked that though). do you trust your mechanic? I think the CarTalk guys may have a list of user-recommended mechanics (fwiw), and there's something called Annie's list http://www.angieslist.com/AngiesList/
You're certain to get more money if you sell it outright than what the dealer will give you trade-in, but you have to deal with random peaple calling you and perhaps wasting your time (or better yet, getting no calls at all). Also certain types of cars do better in regional markets (subarus tend to fetch more in colder climes, trucks used to get more in the South). Also, if you trade-in your VW at a Chevy dealership you're going to get a wholesale/auction price, because Chevy dealer likely won't want to try selling your car (unless it's a prestige/halo car) and they're just going to call the local VW dealership and get a bid from them. So you'll usually do better trading in at a VW dealership (since you have a Jetta), cause they'll probably condition it and re-sell it.
Sales Tax, when you buy new car for $10,000 (plus TTL :P) and dealer gives you $6,000 for your trade-in (which i'm assuming, for this example, that you owe nothing on, it's paid off). Then you subtract the trade-in value from purchase price and pays taxes on that, $4K. If Tax rate is %6, then you need to pay $240 in taxes. If you bought $10K car outright you'd have to pay $600 in taxes. So your time, plus the difference between what you'd make extra selling outright vs. taxes saved if traded in, is what it's going to cost you. edmunds.com has good information on how to buy and sell a car.
Oh, in my case it is a Honda Civic. I have been told that the O2 sensor is a common part failure, and that was the code coming out of the EBDII reader, but when I had the dealer look at it they said the catalytic converter was "about to fail" (specifically they said it "had a crack") as well and recommended I delay the sensor replacement until the CC fails and can be replaced under warranty. I will probably seek a second mechanic's opinion on the whole ordeal. I was looking at about $1200 of parts & labor to make this check engine light go away. On a car worth $5500 in good condition.
That's interesting, I didn't know sales tax worked that way. I would have thought it would be considered two separate transactions, each taxed at 6%, with the buyer in each transaction paying the tax. This is why I thought you might say that the tax advantage of trading in your car is that you don't have to worry about reporting the sale of your old car to the IRS for tax purposes. Or something.