Using KBB Values To Buy Used Cars

Let's talk about using KBB values to buy used cars now that we have convinced you not to take that big depreciation hit that comes with purchasing a new car.

I like to use Kelley Blue Book.com. KBB gives you prices for the retail, private party and trade-in values for vehicles. The retail price is the price that the car dealer will be asking, the private party is what you should expect an individual to ask and the trade-in is what a dealer will try to give for the vehicle as a trade-in value.

For example the following are the KBB values for a 2003 Toyota Tacoma.
Trade-In $11,750
Private Party $13,535
Retail $16,370

You should try to buy from a dealer somewhere around the private party value. As can be seen in the above example there is generally several thousand dollars in variation between the retail and trade in values. This difference will depend on the age of the vehicle and will decrease, as the vehicle gets older. With newer vehicles there is a lot of room for negotiation.

If you are selling your own vehicle then you can use the private party values to help you set a starting price for your vehicle.

If you do not want the bother of selling your own vehicle then you can use the KBB values to aid you when dealers are quoting trade-in-values for your car. In this case you want to get as close to the private party value for your car and pay little more than the private party value for the one you are buying.

KBB values are also adjusted for your particular area. You are asked for your zip code so that the car values reflect those in your part of the country.

This is how we approach car buying. It allows us to go into the dealership informed of the values of the vehicles that we are dealing with and to know if we are truly are getting a good deal.

In late June we purchased a new used vehicle. We traded in our 1998 Honda Accord on a 2003 Toyota Highlander. After doing the research on KBB and shopping around we were able to get private party value for our car and pay private party price for the Highlander. We had all of the information before we went to the car lot and knew what we were willing to pay. In spite of a $2,800 difference between their first offer and what we would pay, we drove it home that evening for our original offer.

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