Can an accident affect your car’s trade-in value? The short answer is “yes”. The long answer involves explaining why this is and what you can do about it. When determining the trade-in value of your car, there are a few important things any car dealership will look at. Obviously they’re going to look at the general condition of the car when you bring it in. No one wants to buy a junker, after all. But almost as crucially, they’re going to check your driving record for less obvious details. Information they find here can easily have an impact on your trade-in value. Here’s what you need to know.
What is included in a driving record?
A driving record is a public account of your driving history. Once you get a driver’s license, you have a driving record, and the information contained in it goes back at least three years. It includes obvious identifying information like your license number and state, and it also contains any information regarding things like driving penalties and accidents. The latter is what a dealership will be looking for.
Your driving record also has an impact on your insurance rate, so it’s always beneficial financially to keep it as clean as possible. Events regarding every vehicle you own are kept on the same record. You can order a free copy of your driving record, so it may be worthwhile to do so before a trade-in. This way, you know what to expect.
Does any accident affect my trade-in?
In many cases, unfortunately, yes. A car’s value is normally diminished simply from having a record of an accident, even if the damage has been fully repaired. Generally, even when an insurance company covers the cost of repairs, they don’t cover the diminished value of the car. This is the case regardless of whether you are at fault for the accident.
What can be done?
Based on this information, it probably seems like accepting diminished value after an accident is a foregone conclusion. Thankfully, there are some things you can do to mitigate your costs. Firstly, it’s important to regularly check you insurance policy and your state’s insurance laws. Discuss with your insurance agent how to lower your risk of incurring costs, and see if you can close any possible legal loopholes after an accident.
If you want to recover costs after an accident, it’s important to get your car appraised. This determines the value of your car before and after the accident, so you’ll know the value you want to recover. Particularly if you were not at fault, you should be able to file a claim against the other party’s insurance company.
Of course, you can’t expect the insurance company to happily write you a check for the diminished value. You’ll need to be persistent and demonstrate hard evidence regarding the value of your car and its diminishment. The insurance company will use an industry standard formula to calculate the amount you’re owed, and this may be different than the number you came up with.
This may not be a struggle you can win on your own. If you feel the insurance company isn’t being fair about the amount, or if they’re resisting altogether, you may want to hire an accident attorney in Pennsylvania or your home state. An expert can help ensure your claim is successful in a small claims court, and it’s likely to be a good investment if your car was expensive. Legal fees will come out of your settlement, but it’s a much better option than receiving nothing.
While any accident is almost certainly going to have a negative impact on a trade-in, following these guidelines will help you get the most value out of your car.