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How to Sell a Car

How to List, Price, Negotiate and Close the Deal


Here are 10 simple steps that will help you turn your used car into cash. Everything from pricing to advertising and negotiating is covered in this short, easy-to-follow process.

Steps to Selling Your Vehicle

1. Know the Market
2. Price Your Vehicle Competitively
3. Give Your Vehicle "Curb Appeal"
4. Where to Advertise Your Vehicle
5. Create Ads That Sell
6. Showing Your Vehicle
7. Negotiate for Your Best Price
8. Handling Complications
9. Finalize the Sale
10. After the Sale

1. Know the Market

Is your car going to be easy to sell? Is it a hot commodity? Or will you have to drop your price and search out additional avenues to sell it?

Here are a few general rules to answer these questions:

  • SUVs are in high demand right now and will likely command higher prices than sedans.
  • Family sedans will always be in demand by people who need basic inexpensive transportation.
  • The sale of convertibles and sports cars is seasonal. Sunny weather brings out the buyers. Fall and winter months will be slow.
  • Trucks and vans used for work are steady sellers and command competitive prices. Don't underestimate their value.
  • Collector cars will take longer to sell and are often difficult to price. However, these cars can have unexpected value if you find the right buyer.

Your first step is to check classified ads to see how much other sellers are asking for your type of car. Keep in mind that dealers will have different prices than private-party listings. Make sure to sort by your year, make, model and trim level of your car to see how many similar vehicles are currently on the market. These are what your vehicle will be competing with, so take note of their condition, mileage, geographic location and selling price so you can list your car at a price that will sell it quickly.

2. Price Your Vehicle Competitively

To come up with an effective asking price, you'll first need to find out what the car is worth and how much other people are asking for similar cars. Appraise your vehicle on Edmunds and pay attention to the "Private Party" price. This figure is adjusted for a number of factors including mileage, condition, options, and the region in which the vehicle is being sold.

An alternate method would be to get an instant offer from Edmunds. All you need to do is enter the details of your vehicle and you'll get a firm trade-in offer, good at participating dealerships for seven days. Use this offer as a baseline for your asking price, or if you're comfortable with the offer, you can accept it and skip the rest of the steps below.

There are always some exceptions to the rules of pricing, so you should follow your intuition. And be sure to leave a little wiggle room in your asking price. Ask for slightly more money than you are actually willing to accept. If you want to get $12,000 for the car, you should list the car at $13,500. People tend to negotiate in big chunks ($500-$1,000) rather than small increments ($100-$200). That way, when a person makes you a lower offer, it will be closer to your actual price rather than below it.

You may have noticed how creative used car dealers get in pricing cars. Their prices usually end in "995," as in $12,995. Are we not supposed to notice that the car basically costs $13,000? There is a lot of psychology in setting prices. A product that doesn't sell well at $20 might jump off the shelf at $19.95.

On the other hand, as a private-party seller, you don't want to look like a car dealer. You might want to take a simple approach and set your price at a round figure such as $14,000 or $13,500.



3. Give Your Vehicle 'Curb Appeal'

When people come to look at your car, they will probably make up their minds to buy it or not within the first few minutes. This is based on their first look at the car. So you want this first look to be positive. You want your car to have "curb appeal."

Before you advertise your car for sale, make sure it looks clean and attractive. This goes beyond just taking it to the car wash. Here is a to-do list to help you get organized:

  • Wash and vacuum the car and consider having it detailed.
  • Make sure your car is both mechanically sound and free from dents, dings and scrapes.
  • Consider making low-cost repairs yourself rather than selling it as-is.
  • Remove all unnecessary items from inside the car. That way, when prospective buyers take a test drive, they can visualize the car as theirs.
  • Wipe the brake dust off the wheel covers and treat the tires with a tire gloss product.
  • Thoroughly clean the windows inside and out and all the mirrored surfaces.
  • Wipe down the dashboard and empty the ashtrays.
  • Have all your maintenance records ready to show prospective buyers.
  • If the car needs servicing or even a routine oil change, take care of that before putting it up for sale.
  • Have your mechanic check out the car and issue a report about its condition. You can use this to motivate a buyer who's on the fence.
  • Order a vehicle history report and show it to the buyer to prove the car's title is clean and the odometer reading is accurate.

4. Where to Advertise Your Vehicle

Now that your car is looking great and running well, it's time to advertise it for sale. Classified ads are the preferred method, not only for convenience but also for their wider geographical reach.

Here are the main markets for advertising used cars:

  • Online classifieds: AutoTrader, Cars.com and CarGurus are effective and cast a wide net but can cost roughly $45 for a fully featured listing. Craigslist, Facebook Marketplace and eBay classifieds are free, but you'll have to deal with a number of random callers — more than those on the paid sites.
  • Social media: Use Facebook and Twitter to let your circle know you are selling your car. Ask your contacts to spread the word.
  • Peer-to-peer sites: Companies such as Carvana, Tred and Zipflip connect buyers and sellers and are a growing presence in the used-car marketplace online. Each operates a little differently, so check the sites for details of their services. These can include car inspections, warranties and return policies for buyers.
  • Message boards: Many online car forums have classified sections in which you can list your car.
  • Word-of-mouth: Tell your friends, co-workers and family.
  • The car itself: It's old-fashioned, but putting a "For Sale" sign in the car window can still be an effective way to sell it.

One last word of advice about advertising: If you run a classified ad, be sure you are available to take phone calls — and texts — from possible buyers. Many people won't leave a message for a return call. So answer the phone or reply quickly to a text — and be polite. Creating a good first impression is the first step in getting buyers to see the car in person.

5. Create Ads That Sell

Think about what you are telling people when you write your ad. Little words convey a lot. Besides the price, your ad should also include the year, make, model and trim level of the car you are selling along with the mileage, color, condition and popular options. It also helps to state why you're selling the car since it gives the ad a more personal feel.

When creating "For Sale" signs or putting an ad online, you have an opportunity to show how eager you are to sell the car. Do this with the following abbreviations and phrases:

Must sell!: This term often means the seller is leaving town and needs to dump the car at a fire sale price.

OBO: This stands for "or best offer" and it indicates that you are willing to entertain offers below the stated price. This usually conveys you are eager to sell the car.

Asking price: This phrase also communicates the feeling that you will negotiate, but it is one notch below OBO on the eagerness scale.

Firm: This word is used to rebuff attempts to negotiate. It indicates that you aren't in a hurry to sell the car — you are most interested in getting your price.

6. Showing Your Vehicle

Many unexpected bumps in the road can arise while selling a used car. These can be handled easily if you are dealing with a reasonable person. So, as you are contacted by prospective buyers, use your intuition to evaluate them. If they seem difficult, pushy or even shady, wait for another buyer. With the right person, selling a used car should be simple.

Some sellers feel uncomfortable having buyers come to their house to see the car. However, you can generally screen buyers on the phone. If they sound suspicious, don't do business with them. If you don't want people knowing where you live, arrange to show the car at a park or shopping center near your home. But keep in mind that people will eventually see your address when you sign the title over to them. Read this article on How to Safely Sell Your Car for more detailed safety tips.

Keep in mind that when you sell your car, people will also be evaluating you. They will be thinking, "Here's the person who's owned this car for the past few years. Do I trust him or her?" Buyers will probably be uneasy about making a big decision and spending money. Put them at ease and answer their questions openly.

Potential buyers will want to test-drive the car. If in doubt, check to make sure they have a driver's license. Ride along so you can answer any questions about the car's history and performance. Also, they may not know the area, so you might have to guide them.

Some buyers will want to take the car to a mechanic to have it inspected. If you have an inspection report from your mechanic, it might put their doubts to rest. But if they still want to take the car to their mechanic, it's a reasonable request. By now you should have a feeling for the person's trustworthiness. If you feel uncomfortable or have reason to think the person will steal the car, decline the offer or go along for the inspection.

Be ready for trick questions such as, "So, what's really wrong with the car?" If you get this, refer the buyer to the mechanic's report or invite him or her to look over the car more carefully.

7. Negotiate for Your Best Price

If a person comes to look at the car and it passes approval after a test-drive, you can expect the person to make an offer. Most people are uncomfortable negotiating, so their opening offer might take several forms.

"I like the car, but ..." This is the softest way to negotiate on the price. The person may not even state that the price seems too high. If the buyer says, "I like the car, but ..." and then lapses into uncomfortable silence, you might consider an appropriate response. If you really want to move the car, you could say, "How much would you be willing to pay?"

"What's your best price?" This is a more direct way to probe the seller to find out how much he or she will come down. If you get this from a prospective buyer, don't seem too eager to reduce your price. Assure the buyer that you've done your research on a fair price, but you're open to negotiating. The goal is to have the buyer make you an offer first.

"Would you accept ...?" Now we're getting somewhere. This buyer has thought it over and is making an offer. But the offer is being presented in a polite manner designed to allow for a counteroffer.

"Take it or leave it." This buyer is making an offer that supposedly leaves no room for a counteroffer. In reality, this buyer might be bluffing. Still, the person is sending a message that he or she is close to a final price. The only way to know for sure whether it really is a "take it or leave it" offer is to leave it — and let the person leave. The buyer may return tomorrow ready to pay your price.

The above are just a few of the openers you might encounter. Think of your responses ahead of time so you won't be caught unprepared. In general, it's a good idea to hold to your price when your car first goes up for sale. If you don't get any buyers right away, you'll know you have to be flexible about the price.

If you post an online ad, you might get people trying to negotiate via text or email. The problem with this is that they haven't even seen the car yet. If you discount the price by email, the prospective buyer may ask for another price reduction after an inspection. Instead, respond by saying, "Come see the car first and then we can discuss the price."

8. Handling Complications

In some cases, you might reach an agreement with a buyer that is contingent on performing repair work on the car. This scenario can lead to misunderstandings down the line, so avoid it if you can. The best thing to do is have your car in good running order while being fully aware of any necessary repairs. If you state clearly in your ads that the car is being sold as-is, you can refer to this statement when it's time to close the deal.

Still, a trip to the prospective buyer's mechanic might turn up a new question about the car's condition. What to do?

This must be handled on a case-by-case basis. If the repair is needed and you trust the mechanic's assessment, you could propose reducing the agreed-upon price by all, or part, of the amount for the repair. If the repair is questionable but the buyer is insistent, split the difference, or have the car taken to your mechanic for further evaluation.

Remember, the older the car, the more a mechanic is likely to find. At some point, you have to draw the line. You may have to say to the buyer, "True, this work could be done. But the car drives well as it is. And the proposed repair isn't addressing a safety concern." After all, a used car — particularly an old one — isn't expected to be perfect.

9. Finalize the Sale

Cash transactions are best, but if your vehicle is worth more than, say, $11,000, for example, the buyer may not feel comfortable carrying that much and will likely want to pay via a cashier's check. Arrange to meet the buyer at the person's bank, to either witness a cash withdrawal or verify funds on a cashier's check you're being given. There are potential scams with cashier's checks to be aware of, so make sure you witness the buyer getting the check from the bank or call the bank to verify its authenticity. Follow these tips for avoiding cashier's check fraud.

But what if you still owe money on the car, and the bank is holding the title? One way to deal with this is to conclude the sale at the bank where the title is held. Call ahead and have the title ready. Then, once money has changed hands and the bank has been paid the balance of the loan, sign the title over to the buyer.

In some cases, however, an out-of-state bank might hold the title. In this instance, we recommend you go with the buyer to the DMV and get a temporary operating permit based on a bill of sale. Then, after you pay off the balance of the loan with the proceeds from the car sale, have the title mailed to the new owner. Sign it over to the new owner and the transaction is complete.

When selling your car, it's important to limit your liability. If someone drives away in the car you just sold and he or she gets into an accident, can you be held responsible? There are two ways to deal with this concern.

Rules governing the sale of motor vehicles vary from state to state. Make sure you check with the department of motor vehicles in your state, and keep in mind that much of the information is now available on DMV websites. Once you have the money from the sale, record the odometer reading and sign the car's title over to the buyer. In some states, the license plates go along with the car. A new title will be issued and mailed to the new owner. Additionally, in most states, a release-of-liability form can be downloaded from the DMV website or filled out online. This document establishes the time the car left your possession.

Finally, remember to contact your insurance agent to cancel your policy on the vehicle you have sold (or transfer the coverage to your new car).

10. After the Sale

In most states, the condition of a used car for sale is considered as-is, and no warranty is provided or implied. So if the car breaks down after you have sold it, you are under no obligation to refund the buyer's money or pay to have it repaired. If you have sold a car to someone who took it for inspection at a garage and the mechanic found nothing wrong with it, you have done all you can to protect yourself and the buyer.

Be open about the condition of the car before the sale as well as timely and complete in transferring DMV paperwork after the sale. Doing everything correctly when you sell your used car will give you peace of mind when you're done.

When done correctly, selling a used car can be a win-win situation. You have turned your used car into cash and provided reliable transportation for the next owner. Focus on the benefits to both parties and you are likely to have a smooth and profitable experience.

Checklist

  • Consider market factors affecting the sale of your car (for example, don't try to sell a convertible in the winter).
  • Check online classified ads to see what others in your area are asking for your type of vehicle.
  • Determine a selling price for your car using Edmunds' appraisal tool.
  • Give your car "curb appeal" by cleaning and detailing it. Fix any problems or drop the price and sell it as-is.
  • Get a smog inspection if required by your state DMV.
  • Consider buying a vehicle history report or getting a mechanic's inspection report to show prospective buyers.
  • Create a "For Sale" sign for your car window.
  • Post an eye-catching online classified advertisement.
  • Make yourself available to answer calls from potential buyers.
  • Arrange to show the car to prospective buyers.
  • Negotiate your best selling price by knowing the market and not dropping your price too quickly. Be patient. Don't let yourself be pressured.
  • Collect payment for the car by getting a cashier's check or cash.
  • Finalize the sale by fulfilling all state motor vehicles department paperwork to transfer ownership and limit your liability.
  • Remove all personal items from your car before the new owner drives it away.


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