How to Use TMV

Edmunds True Market Value (TMV^®) pricing is a powerful tool that helps you identify a good deal on a new or used car. Based on actual sales data, TMV is a guide to what other people in your area paid for the same car.

Knowing the TMV price helps you gain insight on a price quote and negotiate the price of a new car as well as the value of your trade-in vehicle. Additionally, private-party buyers and sellers can use TMV to set the price of used cars.

If you're buying a new car, you can see TMV pricing on Edmunds once you've selected a car's manufacturer, model, trim level (style) and options. It is important to get these details right or you may get incorrect results that can lead to misunderstandings at the dealership.

Edmunds displays TMV pricing of a new car along with two other key pieces of information: the invoice price of a car (roughly what the dealer paid for it) and the manufacturer's suggested retail price (MSRP), which is also known as the sticker price. Used-car appraisals will show different figures. More on that later.

TMV is essential information for you as a car shopper because cars sell at very different prices, depending on their availability and popularity. Knowing TMV allows you to make an offer that a dealer will immediately recognize as reasonable. That means negotiations will take less time and be more relaxed. TMV is also built into the Edmunds tablet and smartphone phone apps so you can check TMV pricing while you're on the car lot.

What Goes Into TMV

Edmunds TMV estimates a vehicle's average transaction price, not its "out the door" cost. Therefore, TMV prices will take into account any incentives and fees that may affect the transaction price, including manufacturer-to-dealer incentives (such as dealer cash), destination charges and advertising fees (when applicable).

However, TMV prices will not include incentives and fees that are typically applied after a transaction price has been determined. These include manufacturer-to-consumer rebates (such as bonus cash), sales tax, DMV fees and dealer documentation ("doc") fees. Here's more about new-car fees.

TMV for New-Car Shopping

Now that you know what TMV is and where to find it, here are some tips about using it to help you get a good deal.

TMV is particularly useful when you use it in conjunction with a price quote from a dealer or with Edmunds Special Offers, which give you a guaranteed upfront price on a specific car. These special offers are ideal if you who want to save time and avoid the back and forth of negotiating.

In many cases (but not always), the Special Offer price is at or below Edmunds TMV. If you want to verify this, double-check the price quote with the vehicle's TMV. Make sure to correctly enter the style, trim and options; otherwise you might get an incorrect figure.

If you've chosen to negotiate, look up the TMV and mention the figure to the salesperson when you're countering an offer. Say the salesperson had quoted you a price of $30,000, but the TMV for the car is $28,000. Tell the salesperson: "I've had a chance to do some research on this car, and according to Edmunds, it's selling for about $28,000. If you can beat that price, we'll have a deal."

Other buyers just want to cut to the chase and will be satisfied with a fair deal, if not the absolutely lowest price on a car. If this is your style, offer to pay TMV. It helps to have a printout of the TMV price handy, or have the TMV information ready to display on a smartphone as you talk.

There is no guarantee the salesperson will accept your offer to pay the TMV price. TMV, while accurate, isn't infallible. There will be times when we don't have enough data to give accurate results or there is a trend that isn't being reflected in the data. In these cases, it's best to get your own "real-world" TMV. Talk to three dealerships to get price quotes. This tactic should give you an idea of the car's actual selling price.

TMV and Leasing

While Edmunds does not offer TMV prices for leasing, the TMV price of a car is a useful piece of information if you plan to lease. A monthly lease payment is based on the selling price of the car, or the "cap cost," in leasing lingo. The lower the cost of the car, the lower the monthly lease payment will be. Once you find the TMV price of a new car, you can enter that price into Edmunds Auto Lease Calculator, along with other information about the car, to get an estimated lease payment.

TMV for Used-Car Appraisal

TMV is also a handy appraisal tool for establishing the value of used cars. You can find the TMV price for your vehicle when the time comes to sell it or use it as a trade-in. This is called the "trade-in value." If you are buying a used car from a dealership, you also can look up its "dealer retail" TMV price using the appraisal tool. The "private party" price is what you'd expect a private-party seller to ask for the car. If you're the seller, price your car slightly higher to leave room for negotiation.

As you use the tool to get the TMV price, it's important to be accurate and honest about the options and the condition level of the used car. Most vehicles will be in "clean" or "average" condition. Very few will qualify for "outstanding" condition.

Edmunds also provides TMV prices for certified pre-owned cars. Once you've entered a car's make, model, year, options, mileage and condition, the information for a certified pre-owned car displays at the bottom of the results page. Again, these are average prices, and the final cost of the car is negotiable.

TMV Is on Your Side

You'll hear lots of car pricing terms tossed around when you're shopping and negotiating for a new car or used car. Amid all the talk of MSRP, sticker and invoice, keep coming back to TMV. That's the number that will help put things into perspective.