Get access to the same vehicle valuation tool that dealers rely on. With Black Book, you’ll have insider data to accurately assess trade-in and purchase values—empowering you to negotiate the best possible deal.
Whether you’re selling your car privately or trading it in to a dealership, you absolutely need to understand the value of your vehicle. The last thing that you want to do is get taken advantage of because you don’t understand your vehicle’s worth. That’s where NADA Guides values become important.
However, there are quite a few different car evaluation tools out there. These are known colloquially as “books,” since they began as physical books. With so many options, which bok value should you use?
Today, we’re going to take a look at NADA Guides, one of the most popular car value estimators out there. We’ll take a brief look at their history, discuss how they reach their values, and examine when you should use their evaluation tool.
What is the NADA Guide?
Short for the National Automobile Dealers Association, NADA has been around since 1917. Not long after their formation, they started releasing NADA Guides, which is an evaluator tool used to determine how much a used car is worth.
Back in 1933, it was released as a periodical publication that has grown into a fully-featured website that helps consumers to understand as much as possible about a car’s value.
NADA Guides values are trusted by countless car dealers and consumers when it comes to understanding the worth of any given vehicle. They are widely considered to be an equivalent to the popular Kelley Blue Book. There is much debate about which one of the two is more accurate, but the truth is that they are both worth using.
How Does NADA Reach Its Value?
Since NADA Guides was created out of a car dealers’ association, NADA Guides use real sales data from car dealerships to reach their values. NADA Guides use three primary criteria to determine the value of any given car:
Local market demand
Wholesale price
Real-time retail market prices
NADA Guides put heavy emphasis on the car’s wholesale price, as opposed to focusing on mileage and conditions, as other value estimators do. The downside to this, however, is that NADA assumes that all vehicles are in great condition. This practice results in overinflated prices in situations in which the vehicle does have mechanical or cosmetic issues.
You should use NADA Guides values in conjunction with other value estimators to paint a picture of your car’s worth. Dealerships will use NADA Guides to establish a loan value for when they look for financing offers, then they’ll typically use the Black Book to reach their offer amount. This means that you should use everything at your disposal to counter their offer and ask for more. You deserve to get the most out of your trade-in.
Are NADA Guide Values Accurate?
NADA Guide values are considered by many to be overinflated, due to the fact that they don’t factor in the condition of the vehicle. However, many dealerships and consumers still use these guides to get an idea about what their car is worth.
Dealerships typically use the Black Book and NADA Guides in addition to their own appraisal to determine the value of your trade-in. They want to make money off of your trade-in, so they’ll generally offer you a much lower value than what you’re expecting.
When Should I Use NADA Guides Values?
You should use NADA Guides whenever you are planning to trade in or sell your car. Don’t rely solely on Kelley Blue Book — use NADA Guides, as well. Both are free, so you might as well put them to work for you! The more information that you can bring to the dealership with you, the better your negotiation will be. There is no single source that dictates your value; you’ll need to use multiple sources to understand the worth of your vehicle.
NADA Guides are largely used by financing companies, too.
Ultimately, NADA Guides are a great resource for anyone that wants to gain an understanding of the value of their car. Just like with Kelley Blue Book, don’t expect a car salesman to suddenly accept your value from NADA Guides. You will need to secure several other quotes from sites like Carvana, Vroom, and Carmax, and leverage these offers during your negotiations. You should do everything that you can to get a great deal on your new car.
If you’re selling your car privately, NADA Guides and the Kelley Blue Book can work together to justify your asking price. You can use both in your negotiations with the other party to help you get the best price for your car.
Interested in learning how people come up with car values? You can learn more about other evaluation books here.
Understanding how much your car is worth is vital when you want to sell it privately or trade it in at a dealership. Without knowing your car’s value, you risk expecting too much or selling it for far too little. That’s where Black Book values matter.
There are quite a few different evaluation resources out there, usually known as “books.” Each one of these books has its own unique method for evaluating how much a car is worth.
Today, we’re going to take a look at one of the gold standards for car dealerships: Black Book. While consumers are often familiar with a book of a different color (yes, we’re talking about you Blue Book), Black Book is often the one that dealers trust and use.
What is Black Book?
Founded in 1955, Black Book has grown and evolved every decade, but their mission has remained the same: To provide the most accurate car valuations out there.
Something that is unique about Black Book is that they charge a subscription fee, which means that their book values are typically only available to car dealerships and lenders. Why would you pay a fee to evaluate your car one time? That is a big reason why most consumers aren’t aware of Black Book (until they get to the dealership).
Black Book valuations are provided through many different mediums, most notably a weekly magazine that is circulated among approved sources, and in other formats, including their website and app. Car dealership solutions such as DealerTrack and Eleads integrate with Black Book to provide their sales staff with real-time Black Book values.
Black Book’s main method to evaluate cars is to visit over 60 auctions throughout the country every week to acquire information about used cars. Take note that these are wholesale auctions, which means that they are for dealers only.
Black Book’s data collectors physically visit auctions to obtain sales data, although they also seek data online. Their goal is to have information about every car sold at an auction in the entire country.
Just like other evaluation tools, Black Book has a proprietary algorithm for the way that they reach their total number for a car’s value. On Black Book’s website, they say that they have precise data that comes from “combining advanced capabilities of data scientists with the industry expertise of automotive analysts.” We like the way that sounds.
Black Book gives different values for wholesale, trade-in, private party, and retail transactions. Additionally, they have subsections based on the reported condition of the car. Just like other evaluators, they use as much data as possible about the target car to reach a value. This data is available for CarEdge members.
Are Black Book Values Accurate?
Since Black Book valuations are largely based on the selling price of used cars at a wholesale auction, Black Book tends to be accurate in its evaluations. Dealerships will undoubtedly use Black Book to determine how much your trade-in is worth. Black Book is typically more conservative than other book values. This is another reason why dealers typically rely on their values — it allows them to make more money when they sell the vehicle.
When Should I Use Black Book Values?
Black Book values were once only available for dealerships who paid the membership fee. However, we’ve integrated Black Book evaluations with our CarEdge member solutions. Now, you’ll be prepared for what a car dealership is likely going to offer you for your trade-in.
However, you should absolutely know about Black Book. Dealerships will run a report on your trade-in and use it to make you an offer on your car. Since Black Book is based largely on real sales, car dealers tend to think of their suggestion of value as the guaranteed sale price for your vehicle. That doesn’t mean that the negotiations need to end there. Instead, you should come back with your own information to get them to raise their offer price.
Before visiting the dealership, obtain estimates from other tools. Your most important negotiating tools will be actual offers from other dealerships. You can easily get a quote from Carvana, Vroom, and Carmax. Using these quotes to guide your negotiation process is a good way to secure a great deal. Additionally, CarEdge members now have access to Black Book valuations so that they know what to expect when they visit a car dealership.
Interested in learning how people come up with car values? You can learn more about other evaluation books here.
Determining the value of your used car requires more just than a rough estimate. When it comes to trading in your vehicle or selling it to a third party, accurate pricing is important. Without it, you run the risk of asking too much (and not finding a buyer) or selling it for too little. That’s where Kelley Blue Book values come in.
However, there are many different evaluation resources that you can use. These are known as “books.” Dealerships and car owners can use these books to evaluate their car’s value. Which one should you be using?
Today, we’re going to go over the most popular book, Kelley Blue Book. We’re going to take a look at what it is, discuss the values they give, and go over when to use a Kelley Blue Book estimate.
What is the Kelley Blue Book?
Kelley Blue Book began in 1926 and has become the standard for used car prices. Part of its popularity came from the fact that they used to publish a physical book that was blue, and it became widely used.
These days, the Blue Book lives at KBB.com, where it provides real-time evaluations of your vehicle. When you input all of the car’s information and details about its condition, you are given both the trade-in value estimate and the private party estimate. You’ll also receive a fair purchase price and pre-owned price (in case you’re the one looking to buy the car).
While they no longer distribute a physical book, the Kelley Blue Book remains the gold standard among consumers that want to learn how much their car is worth.
How Does Kelley Blue Book Reach Its Value?
Kelley Blue Book is vague on their website when it comes to the ways that they evaluate vehicles. Their exact algorithm is proprietary, which means that we can’t pick it apart. All we know is that it depends on data intelligence and uses predictive analytics and field analysis to come up with an estimate of your car’s price. According to their website, they use over 250 data sources to come up with their estimates.
We do know that Kelley Blue Book uses the make, model, mileage, and condition of various systems to come up with its value estimate. They also take into account the type of transmission, engine size, and any custom options that might increase the vehicle’s value. Of course, we can bet that they calculate depreciation, too.
Are Kelley Blue Book Values Accurate?
Generally speaking, Kelley Blue Book values can give people an over-inflated idea of what their car is worth. If you visit a dealership, the used car manager is not likely to agree to your Kelley Blue Book estimate.
Why is this? It’s largely because people overestimate the condition of their car when they’re using Kelley Blue Book’s tool. A small dent might not be worth mentioning to you, but an appraiser will certainly take note of it. Car dealerships primarily have to consider how much work will go into fixing the vehicle up so that it’s ready to sell, which is usually around $2,000.
Kelley Blue Book is a trusted tool for consumers, but dealerships don’t care what it says. They’ll use other tools, such as the Black Book and vAuto to determine what to offer you for your trade-in.
So if we’re strictly talking about dealerships, Kelley Blue Book values are not considered to be accurate. When it comes to private sales, though, Kelley Blue Book evaluations can be quite valuable. Private sellers and buyers both tend to use them when they’re navigating a deal.
When Should I Use Kelley Blue Book Values?
You should use Kelley Blue Book when you’re looking to sell your car to a private party. Since the person you’re selling it to has likely already run a report, as well, you can use these estimates as a starting point for your negotiations.
Ultimately, Kelley Blue Book is a lead generation tool for car dealerships. They do their best to evaluate their cars, but their income generator comes from selling your information to car dealerships or directing your traffic to a car dealership’s website.
Even though you may have been raised to think of Kelley Blue Book as the ultimate decision-maker when it comes to a car’s value, if you’re dealing with the dealership, you’re better off looking at the Black Book or vAuto. Save Kelley Blue Book for the times in which you’re selling or buying a car privately.
We love hearing about the successful car purchases that our members are able to make. Their stories perfectly illustrate that anyone can use CarEdge to save time buying a car while also getting a fair deal. Even better, our members often share that they’ve become expert negotiators, thanks to our tips and their hard work!
Today, we’re going to take a look at a recent success story from one of our members, Dana, to see how she used everything that she’s learned to find a great car at a great price.
Background: Research Pays Off
Dana was in the market for a Honda CRV in the Touring trim level. She found a nearby dealership that had a large used inventory with five or six 2020 Touring models that were essentially identical; each of them had less than 1,000 miles and a fair price.
One of the vehicles had more miles and was, therefore, cheaper, so that’s the car that Dana picked. She ran our Market Price Report on the vehicle and discovered that it had been on the lot for over 200 days. Our Market Price Report also showed an excellent negotiation score, along with a recommended offer price that was well within her range.
The dealership provided a free Carfax report that corroborated the information we provided, so she moved forward. Dana visited her credit union — which we always suggest — and obtained pre-approved financing. As a graduate of our Deal School, Dana felt prepared to head to the dealership.
At the Dealership: A False Start
When Dana arrived at the dealership, she was immediately approached by a salesperson. The vehicle she was interested in was found on the dealer’s lot (and was actually buried behind two other vehicles). Much to Dana’s surprise, all three cars had to be jump-started before they were ready to drive.
The test drive proceeded without issue, so it was time to talk numbers. Dana made it clear that she wouldn’t go over a certain price.
The salesperson returned with a quote that shocked Dana. Dana broke down each line for us:
“I did allow him to review each line item with me. The first line was the list price of the vehicle. The second line was $1.00 for a ‘free Lifetime Warranty.’ The third line was $1,299, which was the service inspection and reconditioning for the ‘free Lifetime Warranty.’ The fourth line item was $1,700, which was a package that included dents/dings/paint, roadside assistance, key fob replacement, and sanitization. So before they even added their $995.00 dealer fee, tax, title, and tag, the vehicle was now $3,000 more than listed.“
After they discussed each item in detail, Dana said she would absolutely not be paying that price. The salesperson removed some of the add-ons, but said they couldn’t remove the inspection and reconditioning fee, which was part of the “free” warranty. She refused to pay this fee.
The salesperson left and returned with the sales manager. They both talked to Dana, who felt like this was an intimidation tactic.
After discussing the numbers and having the dealer deny how long the car had been on the lot, Dana felt strongly that the salesperson and sales manager were only interested in negotiating up, not down. As such, she threw out an offer that she described as “ridiculous,” just to see what they would say. The sales manager said they couldn’t do that, and Dana left the dealership.
She still wanted a new Honda, so she headed home and kept shopping around. Her story shows that sometimes you have to say “no” and walk away. The best price might not always be at the first dealership you visit.
At the Dealership: Part Two
The day after the false start, Dana found an excellent used vehicle on a dealer’s website that was located two-and-a-half hours away. She reviewed the Carfax report, along with every picture and video available. She decided that it listed for a reasonable price.
Dana contacted the dealership and explained to the sales manager that she lived over two hours away, but that she’d be willing to make the drive. She told him that she already had her own financing and that the sales manager needed to come up with their best out-the-door price.
Fifteen minutes later, Dana had an offer in hand. The offer was actually $500 less than what we suggested in our Market Price Report. It looked great, so Dana headed off to the dealership.
When she arrived, a salesperson had already set the car aside for them, and they began running through the textbook sales tactics. Dana reported that the salesperson used some of the same word tracks she had learned about in Deal School, almost word for word.
Dana and her husband agreed that the car was a great purchase for an ideal price. It was a certified pre-owned Honda CRV EX-L. Even though it was a different year and trim than the Touring she had looked at when she visited the first dealership, she ended up saving $10,000 by leaving the first dealership and deciding on another car.
Dana reports that this car purchase was by far the easiest and least stressful purchase of her life. We love to hear it!
A Successful Purchase
We’re thrilled to hear that Dana had a much better experience at the second dealership. It sounds like it was worth taking a step back, visiting another dealership, and even buying a different car. Dana’s story shows us that it’s worth saying “no” when needed and that being flexible in your car choice can save you money. Thank you for sharing your story with us, Dana!
We regularly receive comments and emails from CarEdge members in which they share how they use our solutions to help secure an excellent car deal. We like to highlight these stories to inspire other members like yourself!
Today, let’s take a look at the experience of our member, Dave Lott. We’ll talk about the deal he received, how he managed to make it happen, and his unique experience in the F&I office.
Background: A Knowledgeable Buyer
Dave’s email shows that he has been thoroughly paying attention to everything that we have to share! He was after a 2021 Honda Pilot EX-L, which isn’t a rare vehicle (even amidst the ongoing chip shortage), so he secured quotes from two competing dealerships.
With both quotes in hand, he began negotiations. Let’s see what happened when he went to the dealership that offered him the best deal.
At the Dealership: A Steep Discount
Once he arrived at the dealership, he wasted no time negotiating. Dave was well aware of the microchip shortage and was concerned that it might impact his ability to get a steep discount.
Thanks to his insider knowledge from CarEdge, Dave was able to secure a selling price that was 14% below MSRP, with the final out-the-door price 6.5% below MSRP. We’re quite thrilled to hear that Dave was able to secure such an excellent discount especially amidst these market conditions. It’s worth calling out the reason why Dave was able to get this dealer to come down on price as much as they did: he had a second dealer’s quote. We highly recommend (especially for new vehicles) getting two quotes from two dealerships and having them compete for your business. That’s what Dave did.
We’re also impressed that Dave got the dealership to include a complimentary three-year maintenance plan, with four of the oil changes upgraded to fully synthetic oil.
Dave told us that because he got such a great deal, he was worried that once he got to the F&I office, he would be hard-sold. Let’s see what actually ended up happening.
In the F&I Office: Just Say No
When a typical customer gets to the F&I office, it’s simply another round of negotiations and sales attempts from the F&I Manager. For Dave, the F&I Manager pulled out “the menu” filled with add-ons and simply asked, “Do I need to go over any of this with you?” Dave replied with a simple “No,” and they proceeded to the actual financing.
That is a testament to how knowledgeable the dealership staff knew Dave was!
When all is said and done, Dave walked out of the dealership with an out-the-door price that was 6.5% below MSRP with a 0% APR for 60 months financing — well done, Dave! We love to see CarEdge members getting great deals with the knowledge they’ve learned from our team! Thank you for sharing your story with us, Dave!
