What is Your Car Worth?Many people want to believe that their vehicle is worth a lot more than its true value. However, most of those individuals will be shocked to find out that their vehicle might not be worth much at all.
If you want to sell your car or trade it in, then you will need this information that evaluates car values. The material presented here will give you a clear understanding about your car or truck true value in the market today.
Loan to Value by Banks
Banks are in the business of making money. They are not going to waste their time (or their cash) on using faulty calculations for determining a vehicle’s worth as collateral for a loan. Even if a person takes out a loan to purchase a vehicle, banks still have to determine the true value of that automobile before they will release those funds.
Banks normally use a calculation known as loan-to-value. This equation is often used for people making a mortgage. However, banks also use it for automobile loans. You too can use this equation to get a very close estimate about how much your SUV or truck is truly worth. You will have to contact your bank or a bank of your choice. Ask them about their loan-to-value ratio. They shouldn’t have a problem with providing you this information. Remember, each bank will have a different figure for their ratio.
Keep in mind that all banks are not the same and all financial markets are different as well. So, the true value of your car might be better with one banking institution than with another. By the way, a vehicle’s loan-to-value ratio is also determined by other lending institutions including auto financing companies.
NADA, Kelly Blue Book and Other Automotive Vehicle Valuation Listings
NADA stands for the National Automobile Dealers Association. This organization is one of the top two trusted resources for accurate up-to-date information about a vehicle’s true value. This is a car value guide that many financial institutions, dealerships and consumers utilize to figure out the true value of any vehicle ever manufactured. Kelly Blue Book is another highly rated listing that presents information about automobiles.
Keep in mind that these are companies that present their own trusted car value guide. These guides can be accessed online. They evaluate automobiles on various factors. These factors include compile retail transactions, wholesale transactions and a vehicle’s asking price. They even take a look at original equipment manufacturing information to help determine the true value of a van, SUV or pickup truck. NADA and Kelly Blue Book evaluations can become so thorough that they will also include factors such as supply and demand, equipment, features, MSRP and even how much a vehicle is really worth in a particular market when equated to other vehicles in that area.
How Do Dealerships Evaluate Vehicles?
New car values are often determined by specific factors. Used car values have their own set of criteria for determining overall worth. New vehicles are typically prepped by dealers before they’re sold in the market. They also will include any type of cost they incur for a new vehicle and pass it on to you – the consumer. Dealers will also charge a higher price for a vehicle if they know that an automobile is in high demand. They often will get away with taking this action because there is at least one person willing to pay the money they desire for that particular auto.
Factors Such as Mileage and Vehicle Condition will also Play a Role with Price
A vehicle’s mileage and condition will play a role with its overall price. High mileage cars will have more wear and tear on them. Cars that have been involved in a lot of accidents or have more than 2 previous owners will also be considered bad vehicles. The mileage and condition of any vehicle is important. This is why you should keep accurate repair and maintenance records, avoid collisions and make sure that your vehicle is being kept in good shape.
Other factors will be considered as well. A car value by make and its color can even determine its overall value. If you have a car that is colored orange, brown, purple, lime green, pink or yellow; there will be fewer people ready to purchase your vehicle. Common colors such as blue, black or silver tend to sell faster in the market. People generally like those colors. All these factors are very important to car’s true value and its overall worth.