Do car dealerships take a trade in as a deposit?

Question

I would like to lease a new car and I know I need to put a deposit down on the car. Will the car dealership take my older car as a deposit on the new car I want to lease?

Answer 1

I think you are confusing "deposit" with "down payment". When a dealer agrees to take your old car as a trade-in, he subtracts the value of the old car from the price of your new car as a down payment.

However, if you are still paying on your old car and you still owe more than the car is worth as a trade-in, you are upside down and your negative equity is ADDED to the price of your new car. Find out how much you owe from your bank, and find out the trade-in value of your old car from Kelley Blue Book (www.kbb.com).

This works the same regardless of whether you buy or lease. However, if you don't understand how leasing works, either learn, or don't lease. It's too easy to make mistakes. Here's a web site that might help:

http://www.leaseguide.com/index2.htm

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Answer 2

Yes. But make d**n sure you get blue-book value for it. They tend to give you less than fair trade, then sell it at a huge mark-up.