Should You Trade In Your Current Vehicle or Keep It? Deciding whether to trade in your current vehicle or keep driving it usually comes down to a few key factors: vehicle value, remaining loan balance, repair costs, mileage, and what you need from your next vehicle. Before replacing your car, truck, or SUV, it helps to know where you stand financially and what your current vehicle may be worth. At Commonwealth Chevrolet in Lawrence, MA, shoppers can start by checking their trade value before comparing new or pre-owned vehicles. Value Your Trade at Commonwealth Chevrolet Start With Your Vehicle’s Equity Your vehicle’s equity is the difference between what the vehicle is worth and what you still owe on your loan. Example of positive equity: Vehicle trade value: $22,000 Remaining loan balance: $16,000 Positive equity: $6,000 That $6,000 may be applied toward your next vehicle. If you owe more than the vehicle is currently worth, you have negative equity. Example of negative equity: Vehicle trade value: $18,000 Remaining loan balance: $21,000 Negative equity: $3,000 Negative equity does not automatically mean you cannot trade the vehicle, but it can affect the amount financed on your next purchase. When Trading In May Make Sense Trading your current vehicle may be worth considering when: You have significant positive equity Repair costs are becoming more frequent Your vehicle no longer fits your family or driving needs You need better fuel economy You want newer safety or driver-assistance technology You need additional towing, cargo, or passenger capacity Your mileage is increasing quickly You are approaching a major repair or maintenance decision The key is comparing the cost of keeping your current vehicle with the total cost of replacing it. When Keeping Your Current Vehicle May Make More Sense Keeping your vehicle may make sense if: It is paid off or nearly paid off It remains dependable Repair and maintenance costs are manageable It still fits your daily needs You would need to carry substantial negative equity into another loan Replacing it would significantly increase your monthly expenses A paid-off vehicle that still runs well can be financially valuable even if a newer vehicle offers more features. Does Mileage Affect Trade-In Value? Yes. Mileage is one factor used when determining a vehicle’s value. Two otherwise similar vehicles can have different values based on: Mileage Overall condition Vehicle history Equipment and trim Current market demand Tire and brake condition Interior condition Exterior damage Mechanical condition Mileage alone does not determine the value, which is why getting an actual appraisal can be more useful than relying only on a general online estimate. Get Your Trade Value Should You Repair Your Vehicle Before Trading It In? Not every repair makes financial sense before a trade. Cleaning the interior, removing personal belongings, and taking care of inexpensive cosmetic issues may help presentation. Major repairs are different. Spending thousands of dollars on mechanical or body repairs does not necessarily mean the trade value will increase by the same amount. Before paying for a large repair specifically to improve trade value, consider having the vehicle appraised in its current condition first. What Happens to Your Existing Auto Loan? If you still owe money on your current vehicle, the existing loan must be paid off as part of the trade transaction. If the vehicle is worth more than the payoff amount, the difference is positive equity. If the payoff is higher than the vehicle’s value, the difference must still be accounted for. Depending on the transaction and credit approval, some negative equity may be included in financing for the next vehicle, increasing the amount financed. Knowing both your current payoff amount and your trade value gives you a clearer picture before comparing monthly payments. How Does a Trade-In Affect Your Next Vehicle? Your trade value can directly affect how much you need to finance. For example, if you purchase a vehicle for $40,000 and have $8,000 in positive trade equity, that equity can reduce the amount that needs to be covered by cash or financing before taxes, fees, incentives, and other transaction details are considered. Explore Chevrolet Financing New Chevrolet or Pre-Owned Vehicle? Trading your current vehicle does not automatically mean buying new. A New Chevrolet May Make Sense If You Want: The latest technology Current manufacturer warranty coverage New-vehicle incentives or financing programs A specific trim, color, or configuration Shop New Chevrolet Inventory A Pre-Owned Vehicle May Make Sense If: Lower purchase price is a priority You want more vehicle for a particular budget You are flexible on model year or equipment You want to compare several makes and models Shop Pre-Owned Vehicles The Best First Step: Know What Your Vehicle Is Worth Before deciding whether to keep your current vehicle or trade it, get three numbers: Your current loan payoff Your estimated trade value The cost of the vehicle you are considering next Those numbers give you a much clearer picture than comparing monthly payments alone. Drivers from Lawrence, Methuen, Andover, North Andover, Haverhill, the Merrimack Valley, and nearby Southern New Hampshire can start by finding out what their current vehicle may be worth at Commonwealth Chevrolet. Value Your Trade at Commonwealth Chevrolet