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Seller or trader: Which one are you?

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On the plus side, there is a plethora of Web sites that can help you sell your auto, from asking price information to downloadable "for sale" signs for your auto's windows. Some even help you sell online by posting your auto's specifics for a period. There is a fee for the cyberselling service; it varies by site, but generally is based upon how much info you want posted and for how long.

"Selling your car online reduces the amount of time and the energy it takes to sell it yourself," says Chris Long, product manager of cars.com, one site that offers the service.

Talking trade-in
On the other side is the vehicle trade-in route -- the biggest appeal here is that it's quick and relatively hassle-free. Plus, it could cut your out-of-pocket costs on your next car.

"The value of the vehicle can be immediately applied to the new car price," Vogelheim says. "The car can become the down payment and there's no waiting for funds or the need to establish a relationship with a new buyer."

Trade-ins usually are called for when your car is showing its age, with lots of miles, a rusted and dented chassis, and the tendency for routine maintenance to turn into expensive repairs. It may not be worth much as a trade-in, but the amount that you'll have to sink in to it -- so it will sell -- may be too high for the effort.

My husband and I personally learned this lesson not too long ago when we traded in our Ford Explorer. The SUV had close to 150,000 miles on it, most of them from regularly traveling seven miles up a nasty gravel road. It was to the point that our mechanic, after replacing the drive shaft, begged us to get rid of the Explorer. Nice guy that he is, he was tired of seeing us sink more money into a car rolling ever closer to the auto graveyard.

We couldn't in good conscience sell it to anyone in our small town, even if they still wanted it after learning of its road record. More to the point, it just wasn't worth much. So we took the dealer's $1,000 -- a third of the listed book value for a mint-condition model.

We were happy to replace our old auto and get even a little back on it. But the experience underscored what most car owners view as the biggest drawback to trading in a car: You'll probably get less money than if you sell it yourself.

"It depends on the car and its condition, but you may stand to make $1,000 to $2,000 more if you sell it yourself," says Clark Wood, vice president of marketing at autotrader.com.

But that's not always the case.

"You can sometimes make more when you trade it in if there's a motivation for the dealer to do what we call in the industry 'stepping up to the trade,'" says Perleberg.

He was a dealer for 18 years and used to offer more for trade-ins if he had a long-standing relationship with the seller, who also was a subsequent buyer of a new car from his dealership. Perleberg would also offer top dollar if the car was an exceptional value and had high marketability for his area.

Finally, remember that depreciation will affect the car's ultimate price regardless of whether you trade it in or sell it yourself. Vehicles depreciate quickly, so it might be wise to dispose of it before it isn't worth much in the eyes of a dealer or an individual buyer.

The bottom line: If you have a demanding job, aren't a natural salesperson or hate dealing with details, trading in your auto may be the better choice. But if you like the challenge of doing it yourself and don't mind some extra work for extra money, then selling your car may be a better bet.

Bankrate.com's corrections policy -- Updated: Aug. 29, 2007
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