Remember that fender bend that you had a few months back? Even if you got the car repaired, you may find that accident will come back to haunt you when it comes time to try and sell, decreasing your car’s value by 30% or more. Understanding the factors that play into your car’s resale value will help you to make the most of a bad situation.
How Much Was The Car Worth Before The Accident?
The more expensive your car was at the start, the more it will depreciate after the accident. If the car was not worth much in the first place, then the hidden damage to your bottom line will be less severe. Luxury vehicles and sports cars take the biggest hits, as they are the most expensive to buy at the start.
How Old Is The Car?
If you have ever purchased a new car, then you know that the value decreases the second you drive out of the dealership’s parking lot. This means that most cars see their greatest depreciation in the first three years, and an accident during that time will have the most impact on resale value. As time goes on, the depreciation levels off, and time and mileage have less of an impact on value. With an older car, small accidents will have a smaller impact than small accidents on a newer car.
How Much Damage Was Done?
Of course the bigger the repair, the more it will affect a car’s resale value. Even in minor car accidents, the vehicle can suffer from structural damage that can lead to costly repairs. The higher the percentage of the car’s total value the accident repairs come to, the bigger impact it will have on the resale value. So if you have to put in $5,000 in repairs, the impact will be greater on a car worth $10,000 than one that is worth $20,000.
How Well Was The Car Repaired?
If you tried to repair the car yourself, or used the cheapest mechanic and parts that you could find, then chances are the repair did not restore the car to like-new condition. The higher the quality of the repair job, the less an accident will affect the bottom line of the resale transaction. If the repair was done using original parts and done well enough that the car appears new again, then it will have a much smaller impact on the car’s value than someone who went down to the junkyard to salvage parts.
How Vehicle History Reports Have Changed the Game
In decades past, if you had the damage repaired after an accident, no one would be the wiser, and you could sell the car for its typical resale value. Today, however, the easy availability of vehicle history reports and free VIN checks means that anyone can find out about any accident that was reported.
If you are in a reported accident or if you take your car into a mechanic for work, then the VIN number is tracked. Vehicle history reports can then research your VIN to ascertain what has been done to the car. Since most people buying a used car are looking for a deal, they will use any possible negatives on a car as an excuse to haggle the price down. Others will walk away from a deal if they suspect that the history of the car is going to give them trouble, even if there is no visible damage or problems at that point in time.