How Trade-Ins Can Lower Your Down Payment at a BHPH Dealership
What to Know
- When you trade in a vehicle, you can apply the positive equity toward the down payment for your new car, reducing your out-of-pocket costs.
- Trading in a vehicle is faster, more convenient, and less stressful than selling it privately.
- Even if you have a remaining balance, dealerships can pay off your lender directly and apply any positive equity towards your new car.
- Hawthorne Auto Square makes trade-ins easy with online appraisals, flexible financing options, and loan approval, no matter your credit score.
Why Trade-Ins Are a Smart Move for Car Buyers
If your current vehicle can’t keep up with your lifestyle, it may be time to consider a trade-in. Trading in a car offers convenience, potential savings, and lower monthly payments, making it more affordable to buy your dream car. You’ll only need to handle a single transaction, avoiding the hassle of selling it privately and applying the used car trade-in value directly to your new car’s down payment.
Learn more about the benefits of trade-ins at Buy Here Pay Here (BHPH) dealerships like Hawthorne Auto Square, and discover how trading in your vehicle can help you get behind the wheel of your dream car faster.
How Do Trade-Ins Work at a Buy Here Pay Here Dealership?
The process for trading in a car at a Buy Here Pay Here dealership is essentially the same as that at any other dealership. Your current vehicle is appraised to determine its value, and that price is applied toward the new vehicle you’re purchasing.
If you still have money owing on your trade-in, the amount is deducted from its appraised value. If the balance is less than its appraised value, the remaining balance goes towards your new car’s purchase price. If the remaining balance is higher than its appraised value, it‘s added to the cost of your new car, resulting in an increased loan amount.
How Much Can a Trade-In Lower Your Down Payment?
The amount a trade-in can lower your down payment depends on the value of your vehicle and the amount you owe on it. If it’s completely paid off, you can apply the entire appraisal value to your down payment.
If you have a remaining balance on your current vehicle that’s less than its appraised value, you can deduct the balance from the appraisal price to determine your trade-in equity. For example, if your trade-in is worth $20,000, but you still owe $10,000, you can apply the $10,000 in positive equity to your down payment.
What If You Still Owe Money on Your Trade-In?
Owing money on your vehicle doesn’t prevent you from trading it in. When you trade in a car with an outstanding loan, the dealership will directly pay your lender to settle the remaining balance.
If your car’s appraised value is higher than what you owe, you can apply the remaining balance to your down payment to lower your out-of-pocket costs. However, if the balance is higher than your vehicle’s value, the difference gets added to your new car loan, increasing your balance and monthly payments.
Benefits of Trading in vs. Selling a Car Privately
Trading in your car is a quick, hassle-free process compared to selling it privately. When you trade in your vehicle to a dealership, they handle the appraisal, paperwork, and loan payoff on your behalf. You can also apply your trade-in value toward your new car purchase, reducing your down payment and streamlining the buying process.
Selling your car privately can offer the potential for a higher profit, but it requires time and effort. You’ll have to advertise your vehicle, negotiate with buyers, and handle all of the paperwork yourself.
Can a Trade-In Help You Get Approved with Bad Credit?
Trading in a vehicle can improve your chances of getting approved for a car loan, even if you have bad credit. A trade-in shows financial stability and lowers the amount you need to borrow from lenders. If your vehicle has positive equity, you can apply that amount to your down payment, reducing your loan amount and making lenders more willing to approve your financing.
At Hawthorne Auto Square, we’re a credit-friendly car dealership with special financing options in place for those with bad credit. Regardless of your credit score, we can help you secure a loan and get approved on the same day. Having a trade-in is just an added bonus that can lower your monthly payments and make the buying process even more budget-friendly.
Service Areas for Hawthorne Auto
If you’re ready to upgrade to the vehicle of your dreams, visit one of our Buy Here Pay Here lots. Our dealerships are conveniently located throughout Southern California, including the following locations:
- Inglewood
- Pasadena
- Compton
- South LA
- Torrance
- Long Beach
- Beverly Hills
- Santa Monica
- South Gate
- And more!
Lower Your Down Payment With a Trade-In at Our Hawthorne Auto Dealership
Why wait? Your next car is waiting for you at Hawthorne Auto Square. Visit our dealership today to trade in your vehicle and drive away in a car that fits your lifestyle. We’ll handle the entire process, from appraising your current vehicle to paying off any remaining balance, so you can enjoy a stress-free experience from start to finish.
Contact us to learn more or visit one of our Southern California dealerships to get started today!
Frequently Asked Questions
How do dealerships determine trade-in value for used cars?
At Hawthorne Auto Square, we assess your vehicle’s make, model, year, trim, mileage, and condition to determine its value. We then use Edmunds True Market Value (TMV®) to ensure you receive fair market pricing.
What documents do I need to trade in my car for a down payment?
To trade in your vehicle for a down payment at a Buy Here Pay Here dealership, you’ll need your driver’s license, vehicle registration, proof of insurance, and the car’s title. If you still have money owing on the vehicle, we’ll need your financing company’s account number and contact information to settle the balance.
Do you offer zero-down loan programs?
Yes, we have credit unions willing to offer 100% financing to qualified buyers. If your remaining payments are higher than the value of your trade-in, we can apply the difference to your new loan, making it easier to drive off with no money down.
How do I get my car appraised for a trade-in?
You can begin the trade-in process using our online appraisal tool. Simply enter the required information, and you’ll receive an up-front estimate in as little as 48 hours. After that, visit one of our dealerships for a professional appraisal, where our team will inspect your vehicle and provide a final trade-in offer.
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- Pre-Inspected Cars
- Clean Title
- Under Warranty