NADA (National
Automobile Dealers Association) has been providing the car values since 1917.
Although it came into print in 1971 but a lot of buyers/sellers had already
taken benefit of it. Since, then more and more dealers are getting associated
with NADA Guide and it has prepared a huge database from the dealers which log
each vehicle sold through dealerships across the country. This log is then used
for future reference when a similar vehicle is purchased. Since it operates
primarily with new vehicles, which are typically in excellent condition, they
list higher values.
Even though buying a
used car seems far more complex than buying a new car, they really are not that
different. All you need to do is begin by looking in the NADA guide and
determining the NADA used car value. The great advantage of this guide is that
it draws its information from all of the car sales in the nation. This does not necessarily mean that the car
is being sold at a great price. But at
least you have a base line to work from.
Another important thing
to do is to compare NADA guide to the KBB.
Even though the NADA blue book uses final purchase price of cars throughout
dealerships and auctions all throughout the country, the KBB primarily
calculates used car prices. In fact, it
was created for that reason, whereas the NADA guide was created for cars in
general, with a leaning towards new cars.
Why bother using the
NADA used car value? One word:
comparison. Sometimes, the NADA used car
value will be lower than the Kelley blue book value. When that happens, you have one more
advantage to bring to the negotiating table.
Now, even though buying
a used car is not much more complex than buying a new car, we still have to
take into account one thing. Unlike new
cars, each used car is unique simply because of its mileage, condition, and
options. The NADA guide and the Kelley
blue book actually address these specifically in their calculations. There are
various factors which affect a car's value:
–
Mileage:
This is one of the most important factors for determining the car's value. It is inversely proportional to the value
i.e. more the mileage, less will be the value. Tip: Always look for cars with
lesser mileage.
–
Accidental:
If the car had an accident when it was with its previous owner, you got to be
careful. Accidental cars get the least value and sometimes the price drops to
50% of the car's value.
–
Paint:
Look for rust and stains all over the vehicle. If you find anything, prepare
yourself to negotiate for a lower value.
–
Sounds:
There can be various types of sounds like rattling sound, engine sound, sound
coming from the interior etc. If the engine noise is very high, there might be
a problem with it. Tip: Take a test ride and observe the noises while standing,
driving, turning reversing etc.
For example, in
calculating the NADA used car value of a 2010 Toyota Camry, you BEGIN with the
mileage! After that, questions are asked
about transmission, power windows, cruise control, power door locks, leather
seats, aluminum/alloy wheels, power sunroof, rear entertainment system, and
navigation system.
Imagine trying to weigh
these all without a NADA blue book or Kelley blue book!
Now, one thing that
must always be taken into consideration is that the NADA used car value does
not take into consideration private sales.
Instead, it will offer four categories: Rough Trade-In, Average
Trade-In, Clean Trade-In, and Clean Retail.
Of course, the clean retail would match the actual NADA value offered
for the vehicle according to nationwide final sales prices.
Remember, there is no
rule about which one you should use. Car
valuation is a complicated process. The
blue book guides like Kelley Blue Book and NADA Guide helps make that complex
process easier.
Summary
NADA Car valuation is
not an easy process. You need to take care of tones of things before you buy a
car. And for the sellers, it can be a nightmare if the buyer has already done
his part of research for the car's value. Always make everything transparent
while dealing to avoid conflicts.
No comments:
Post a Comment