Research

• Know the value of your trade-in vehicle before you begin shopping for another car. Websites such as Kelley Blue Book will give you the wholesale, private sale, and retail cost of virtually any car. You can also take your car to CarMax for a no-obligation purchase offer to see how it stacks up against the Kelley Blue Book evaluation. Check used car ads online and in the local newspaper to get an idea of how much similar vehicles are being sold for in your area. Keep in mind that a dealer's offer will be closer to wholesale than retail.
  
  

Negotiate

• Do not begin negotiations on your trade-in vehicle until you have already settled on a purchase price for the car you are buying. If the salesperson asks whether you will be doing a trade-in, tell him that you have not decided yet. Otherwise, he may not be willing to negotiate a good price on the new vehicle. Instead he mayleave in extra profit that will allow him to give a falsely inflated value on your trade-in vehicle.
  
  

Options

• If you are not happy with the dealer's offer for your trade-in vehicle, consider your other options. You may be better off selling it yourself and delaying your new car purchase until you do so. The dealer may try to pressure you into buying a car because he doesn't want to lose a potential sale. Don't let this influence you into making a bad financial decision. If you decide to sell your old car rather than using it as a trade-in and the vehicle you were planning to purchase is sold in the meantime, there will be plenty of other new cars to choose from.