Car Trade In Question for Dealers
 

When I had placed the order for my 1LT last month the dealer inquired whether I would trade the my current vehicle in or not. I had told him I would consider it and not 100% sure if I would keep it or trade it in. When the order and contract was drafted it they had placed the trade in value on the contract along with my down payment and the price of the 1LT I am purchasing.

This basically showed what the price of the car is out the door with the registration, trade, down payment and options. my question is am I now locked into trading the car with the dealer? Do I have the option to keep my trade in without altering the price we had greed apon for the 1LT car?

No, you are not locked in to trading in your car. You can take that out of the equation at any time.

You should let them know the minute you make your decision though, just as a courtesy.

The price of the new car is the price of the car...that should NOT change.

AnnaBear is 100% on the money.

The trade is considered basically a seperate part of the transaction and no reputable dealer would change the price of the new car based on the trade in.

If they do, it means they were adding profit by "stealing" the trade and you should immediately walk away from the entire deal.

Well I called and they are going to charge me the sales tax on what my trade in was quoted at if I choose to keep the car. I dont quite understand it. Basically they gave me a $5000 value on the car and in CT sales tax is 6%. So they want me to pay them $300 if I dont trade my car in.

If your state has a "tax on the difference"
then the amount would be $300.

That is basically a tax break for
individuals that use a trade-in.


Some states, ie: Michigan...the tax is always
on the total, before the trade.

OK so they took the total price of the Camaro, subtracted the $5000 for the cost of the trade in, then taxed the price of the Camaro.

Yes, that would be a "tax on the difference",
that would be the calculation in your state.

If no trade is used...tax is on the total.

Thanks, that clears it up.

:thumbsup:

We need pics when you get it!!!
:wub:
Becky

You already paid tax on your car when you bought it so that trade value is deducted from the price of the new car when calculating the tax on the new car.

If the trade is pulled from the deal, the tax you saved due to the trade allowance is back in the deal so you are taxed on the full amount of your new car.