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They will do anybody a favor and let them trade in any car at any time. Provided there's a certainty they can sell the trade in at a profit.
What you want is to never ever be "upside down" on your car loan- meaning you owe more than it is worth. Ideally you want to maximize every dollar if you choose to trade in, which means a good idea is to have the car paid off.
I traded in a car I owed 4 grand on to get my Camaro. I was motivated beyond "cool, a Camaro" at the time. I actually ended up with a smaller car payment per month than I had previously. But look, a small car payment is not the end all and be all of the game. You want a good deal on the car, not simply a good deal on monthly payments.
If you paid 400 bucks a month for example, over 4 years that's 19200 dollars. But since the interest also factors, you've paid off less than that raw amount on your loan, depending on interest rate. Obviously.
So you have to look at the condition of the car you want to trade in- you want to maximize value. They will inspect the car. they will deduct for things like repairs needed and mileage and if the car needs brakes or tires. Then they will tell you a story. If the 'blue book' value of an 'average' car like yours is 20K, they'll tell you the car needs tires and has high average miles, and they'll give you 15K for trade in. And you'll hem and haw and argue and they will 'relent' and give you 17K. Maybe.
So that's 17K off the price of the car you want to trade in for. But.
You owe money on the car you have. 10 grand. So they add 10K into the mix because your loan must be paid off. So suddenly you're getting that 30K car you're trading in for at 23K. Your loan will be for 23 thousand, not 13 thousand.
With the car I traded in, a five year old model with average miles, sports car, excellent condition, brand new tires, GMPP upgrades with full factory warranty, all maintenance up to date, no work to be done other than put it on the lot and list it- I even gave them the original window sticker- I was able to get 40% of sticker price (not that I paid anything near the sticker price). That was the maximum trade in for the car allowed. Then they turned around and sold it within three days, for 70% of the sticker price. Nice work if you can get it.
Shoulda kept that car...
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