- How to go about part exchanging your car
- The benefits of part exchanging
- How to get a part exchange value
Buying a new car can be as easy or difficult as you make it. One of the ways of making life simple for yourself is to get rid of your existing car by doing what’s known as part-exchanging it.
This is when you sell your existing motor to whoever you are buying its replacement from. The value of your car then comes off the price of the new model. It’s a simple principle, but there are some things you should know to get the best possible deal. You can get a free car valuation here.
Why part-exchanging is easy
Think about when you buy a car. You look for things like long MoTs and full service histories. And if you sell your car privately that’s what any buyer is going to be expecting from you. Part-exchange your car and none of that matters. As you’re essentially swapping your existing motor for a new one, you no longer need to put any effort into selling your car if you don’t want to.
Part-exchange car value
Knowing how much your car is worth is key to getting a good part-exchange deal. Look around on car valuation websites for your make, model and age of car. Used car sales sites also provide a handy barometer for your car’s value.
Think of your car objectively too. The person you’re part-exchanging with will. Factor in scratches, dents, damaged interior trim and things like worn tyres. Whoever is taking your car as part-exchange will knock all that off the money they give you.
Don’t expect to get as much part-exchanging your car as you might from selling it privately. Think of the financial hit you take as payment for removing some of the hassle you’d have to go through.
Part-exchange with someone who wants your car
If you’re buying a car from a BMW dealer and you want to part-exchange your eight-year-old Ford, you’re unlikely to get the best price for it. No matter how good nick your Ford is in, it’ll be a waste of space – literally - to a BMW dealer. They’ll stick it behind the showroom before it can be shipped off to an auction house.
On the other hand, part-exchange an ageing Ford to a Ford dealer and you’re much more likely to get a decent price for it. They’ll know exactly what it’s worth and probably have customers, or know used car dealers, who might be interested in it.
Keep the deals separate
Ideally when you are part-exchanging your car you want to focus on your existing car’s value and the value of the new car as two separate things.
This is called the cost to change. Think of it like this. If you’re buying a new car for £12,000 and someone says your existing car is worth £4000, the cost to change – the money you need to find - is £8000. If another seller offers a car that fits the bill for £12,500 but gives you £5000 for your car, the cost change is £7500.
Some dealers like to confuse the issue by bundling the part-exchange car in with the new model. You might end up with an average deal on your new car and poor deal on the part-exchange car, or vice versa. Keep them separate and there’s more chance you’ll end up with a decent deal on both.
Part-exchange car on finance
In order to part exchange your car, you must own it. If you bought it using finance such as Personal Contract Purchase (PCP) or Personal Contract Hire (PCH), the finance or lease company will own the car until the end of the deal’s term.
If you want to part exchange a car owned by a finance company but you must do so with its permission.
When a car is at the end of its PCP deal, you are free to part exchange it. If a car has been well looked after, or done less than the agreed mileage during its period on finance, it could be worth more than the balloon payment you’ll need to own it.
If that’s the case, the additional equity you have in your existing car can go towards the deposit for its replacement.
Scrappage is another way of part-exchanging
Some car makers run what are called scrappage schemes. This is when you swap your old car for a new model. Your old car must be older than a certain number of years. And you must be swapping it for certain new models. But do that and the rewards can be good. Some car firms will offer far more than your old car would normally get part exchange.
Do still focus on the cost to change. A new car is likely to be very expensive, so even with a generous part exchange price for your existing car, the cost to change is likely to be more than if you bought a used motor.
The benefits of part-exchanging
Removal of hassle aside, there are several benefits to part exchanging. Perhaps most importantly, you’re not left either not having a car because you’ve sold yours or having two cars because you haven’t found a buyer yet.
You also don’t have to spend money advertising your existing car or making appointments with possible buyers who then don’t turn up.
And you can sell a car that has outstanding finance on it, something you can’t do if you’re selling privately. The finance company or dealer you’re part-exchanging with will settle up with your finance company.
What you need to part-exchange
If you want to part-exchange your car, you should take certain bits of paperwork to the dealer with you. This will enable things to go as smoothly as possible.
- The V5C registration document
- Service history and invoices for any work carried out
- Spare key
- MoT certificate
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