Selling a car for less than $2,000 is a very different experience from selling wheels that go for $20,000, $10,000 or even $5,000. This is the bottom of the market, and you'll encounter unique questions and problems. This article will help you navigate this territory, anticipate challenges that may come your way and ultimately maximize your selling price.
Under $2K Selling Steps
1. Decide what to repair
Let's face facts: In this price range, your car is probably an older vehicle with lots of miles on the clock. Trading the car in at a dealership would likely net you next to nothing. So should you fix it or sell it "as is"? Of course this will depend on the cost of repairs, but the selling process will be quicker and smoother if you make major repairs beforehand.
Experts say that getting a repair estimate will help determine your sales tactic. "If the cost of fixing it is half the price of what you're asking for, you may be better off selling it for less as a 'parts car,'" said Edmunds Automotive Editor John DiPietro. If repair costs are less than half the car's value but are still more than you want to shoulder, offer a copy of the estimate to the potential buyer, who can factor this into his or her decision.
You can also offer potential buyers a vehicle history report to show you're negotiating in good faith by disclosing potential problems. This can also prevent misunderstandings and problems after you make the sale.
2. Set a price with wiggle room
Determine the value using Edmunds' used car True Market Value (TMV®) appraiser, then look at what comparable vehicles are selling for in your area. This gives you an idea what your target selling price should be. But there will be some negotiating before you get to this price, so you have to add a little wiggle room.
For example, we recently had to sell one of our personal vehicles. It was an older salvage title car, but we wanted to get no less than $500 for it. When we posted it on Craigslist, we set the asking price to $900. The car eventually sold for $650.
3. Decide where to advertise
When selling a car in this range, Craigslist is a valuable tool in getting the word out. Auto Trader is a more established venue for advertising your vehicle, but the listings cost about $40 each. Since your profit margin is already pretty thin, start with Craigslist or other local free listing services, and move on to paid ads if you aren't getting results in about three weeks.
4. Create an effective ad
The more details you give about the car's condition, the more likely you are to make a quick sale. "You have an unlimited amount of space, so use it," said Susan MacTavish Best, spokeswoman for Craigslist. In the body of your ad, give all pertinent information about the car's condition. "Be honest in your description," says Best. "If it's a lemon, say it's a lemon."
Make it easy to read by using bullet points, and include photos from different angles of the car's interior and exterior. Craigslist lets you post up to four photographs, but they tend to be small. So consider posting more photos on a sharing site like Flickr and include the link in your ad.
We recommend posting only your e-mail address at first to avoid getting annoying calls early in the morning and late at night.
5. Get paid in cash
In this price bracket, asking to be paid in cash is essential since this will avoid problems with bad checks or fraudulent money orders.
What To Expect After Placing Your Ad
1. Initial flurry of prospective buyers
When you post something on Craigslist, you'll get the most activity the first few days after the entry is posted (after the third or fourth day, your post will be buried under countless new ads). One way of managing the heavy activity is to schedule your posting at the beginning of the weekend or when you have a day off so you are able to show the car to multiple shoppers.
2. Scam e-mails
A common scam we have seen, particularly on Craigslist, is an e-mail asking you to click on a link to "get an insurance quote." Other fraud schemes suggest that you can get a better price if you go to their Web site, or people from out of state will "wire the money" to you. According to Craigslist's fraud/scam page, if you deal locally with people you can meet in person, you will avoid 99 percent of the scams.
3. Blind negotiators
With low-end cars, many people will want to negotiate a price before even seeing the car. This is problematic, since they will likely request a further price reduction once they inspect the car. Obviously they're trying to save time, test your price flexibility and take advantage of the anonymity of e-mail or the telephone. As a rule of thumb, "Don't negotiate until a person has seen the car," said DiPietro. Tell prospective buyers you can't negotiate because any price adjustments should be specifically related to issues concerning the car's condition.
4. Ridiculous offers
Since the Internet and telephone are anonymous, people feel more confident and more likely to make offers that they would never make in person. We've had people offer to trade us an even older vehicle; another person asked us to donate the car to him since he was a struggling teacher. One guy even offered to give us 13 Playstation games and $150 in exchange for our car. Don't acknowledge these offers.
5. People who want to flip your car
There are many people who buy old cars, make a few repairs, and sell them for a profit. There's nothing inherently wrong with this, but the main goal is to offer you the bare minimum, so they can maximize their profit.
6. No-show headaches
In this price category, buyers are more apt to schedule an appointment to come see the car and then fail to show up. You will make your life much easier if you try to weed out the flakes over the phone. Set only a specific time rather than saying, "Stop by any time this afternoon." Also, politely let them know that you will not be available outside the agreed-upon time. Then, urge them to call if their plans change, and reschedule the inspection.
To find a dealership that knows how to treat shoppers right, please visit Edmunds.com's Dealer Ratings and Reviews.