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NON-DEALERS
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| Selling a Vehicle Privately |
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Selling a vehicle privately can be profitable, but there are some
potential pitfalls. Asking yourself the following questions can help
you to decide whether to go that route and how to maximize your
chances for success:
1) HOW SALEABLE IS MY VEHICLE?-
Certain vehicles work well for consumer-to-consumer sales, others
dont. Make and model, mileage, and price range are the important
factors to consider in determining the likelihood of a successful
sale.
Make and model: In general, the more popular the make and
model, the more response you will get. It is a lot easier to sell a
Honda privately than it is an Oldsmobile.
Mileage: It is much easier to sell a higher mileage vehicle if
it is a popular make and model and in a lower price range. There are
many more buyers for a '96 Honda with 80,000 miles than a '99 Honda with
80,000 miles.
Price range: Lower price range vehicles tend to work better in
private sales. Financing and warranty issues are less relevant. There
is less competition from dealers selling new and late-model used
vehicles. There are many more consumers searching newspaper ad's for a
'96 Honda for $7500 than for a '00 Honda for $17,500.
Consider how your vehicles combination of make, model, mileage, and
price range lends itself to a private sale when making your decision
to sell privately or not.
2) HOW SHOULD I PREPARE MY VEHICLE?
When trading-in a vehicle, our advice is to spend minimal time and
money preparing a vehicle. In a private sale, the opposite tends to be
true. The vehicle for sale should be clean in and out, mechanically
sound, accessories functional, brakes sound, tires up. The fewer
excuses, the better your chances for a successful sale.
3) HOW SHOULD I PRICE MY VEHICLE?
Nothing sabotages private sales more than over-pricing a vehicle. People purchasing a
vehicle privately are looking to save money. If you can't save them enough money to offset the
level of comfort they would feel when buying a vehicle from a dealer, you are wasting your time.
Dealers are in a position to offer warranties, financing, recourse should something go wrong, and
a certain level of "good will" if necessary. Private sellers cannot offer these "extras". In general,
pricing a vehicle mid-way between our values and dealers' advertised prices for similar vehicles in
your area is a good rule-of-thumb.
4) WHAT EXPENSES WILL I INCUR
SELLING MY VEHICLE PRIVATELY? You need to be realistic
about the expenses involved in selling a vehicle privately. Advertising
in the newspaper can be relatively expensive, both for the initial
ad and potential repeat ads. There are some less expensive alternatives
available through the Internet and alternative auto publications.
Calculate what you will spend making the vehicle attractive and
sound. Remember that if you reside in a state with a sales tax
(see: How Trading Your
Vehicle May Save You Hundreds!), you may forfeit a tax credit
by NOT trading the vehicle in, and you need to think of that as
an expense. Maintaining insurance on the vehicle while it is for
sale is an additional expense you should consider.
5) WHAT SHOULD I ACCEPT IN PAYMENT?
We recommend accepting only cash or a bank check in a private
sale. Make sure that if you accept some other form of payment you do
not release either the vehicle or the title before funds have cleared.
6) WHAT ARE SOME LESS OBVIOUS CONSIDERATIONS?
Selling privately can take up a good deal of time and energy with phone calls and appointments.
If and when potential buyers show up and look at the car, they will often want to take the vehicle to a mechanic
and you may have to accompany them. You will have strangers coming to your home. Although you might have no further
legal responsibility once a sale is consummated, there can be repercussions if a mechanical difficulty arises soon afterwards.
These are some of the important things to consider before selling a vehicle privately. Should you decide to go this route,
we suggest using the Galves value as your starting point in pricing your vehicle correctly.
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