Changing cars would be easier if the person buying yours wanted the keys on exactly the day your next one was ready. Until then, you still need to get to work, collect the kids or do the shopping, and somebody has to pay for the car you’re about to buy.
If you need to sell your car before buying a new one to free up the money, selling first is sensible, provided you have another way to get around. If you can afford a short overlap and can’t manage without transport, buying first may suit you better. A trade-in offers another way to coordinate things.
| The order | When it could suit you | The catch |
| Sell, then buy | You need the money and have other transport | The wait without a car could get expensive |
| Buy, then sell | You need a car every day and can afford both temporarily | Your old car might take longer to sell than expected |
| Arrange a trade-in | You want the sale included in the next purchase | You still need to compare the whole deal |
How much money will selling your car actually free up?
Before committing to the next car, get a realistic idea of what yours could bring in. Our car valuation is a starting point, although an online estimate isn’t the final agreed purchase price.
If you own the car outright, the calculation is simple: allow for selling costs, then see what remains. If you’re clearing a loan from the sale money, only what remains after the payout is available for your next purchase.
For example, suppose you sell for $24,000, and your lender’s payout is $18,000. You have $6,000 left before selling costs. That’s positive equity. If the payout is $26,000, you’re $2,000 short instead, called negative equity. These are hypothetical figures, but the distinction matters when you’re counting on a deposit.
Ask for a current payout figure, not just the balance on your latest statement. CommBank explains that the payout includes applicable interest and fees and relates to a particular date.
Tell the lender you’re planning to sell, and agree how any loan secured against the car will be settled and its security released. If the sale date moves, check whether your payout needs updating. Our guide to selling a car with finance owing explains the extra steps.
Selling first can make the budget easier
Something is reassuring about shopping with money you’ve received. You know what the old car contributed and can decide how much more you’re comfortable spending, without relying on an asking price that nobody has agreed to pay.The awkward part is getting around afterwards.
For a household with a second car, that might mean sharing for a week or two. For someone who drives to work before public transport starts, it could mean car hire, lifts or a much less convenient commute. Price those arrangements before deciding that selling first will save you money.
And start looking for your next car while you still have this one. You can browse used cars, inspect a few and work out what you’d be happy to buy. You don’t have to wait until you’re standing in an empty driveway to begin.
The real test is whether you could walk away from an unsuitable car and keep looking. If being without transport would force you to settle, selling first may put you under more pressure than you expected.
Buying first gives you continuity, at a cost
If the car is essential to your working week, keeping it until the next one arrives can be the more practical choice. You’re paying for an overlap, but you’re also avoiding the disruption of having nothing to drive. Just be honest about how long you could carry both.
A private buyer might pull out, need finance or simply stop replying. Meanwhile, repayments and insurance don’t pause because your listing has gone quiet. Include both cars in your monthly cash budget and ask the new lender whether the existing loan needs settling before the replacement loan can proceed.
Choose when you’ll reconsider the sale. That might mean reviewing your price or asking for an outright dealer offer. It’s easier to turn down a poor offer when you haven’t already reached the limit of what you can afford.
What about trading in?
A trade-in can save you having to organise two separate handovers. The dealer agrees a value for your old car as part of buying the next one, with the arrangements recorded in the purchase agreement.
You might be happy to accept a little less for the old car if the dealer can arrange the handover around your next purchase. Before deciding, though, check what that convenience is costing you.
Ask what the replacement costs without your trade-in, then compare that with the combined offer. A higher allowance for your old car isn’t much help if you’re paying more for the next one. Any finance being paid out also reduces what your trade contributes.
You can sell outright to a dealer without buying their car, too. That leaves you free to compare purchases elsewhere.
Either way, work out the car changeover cost: what you still need to fund after the sale, plus any fees and transport costs that haven’t already been included. Put the full repayments in your budget. When comparing costs, separate interest and fees from the part paying down what you borrowed, and don’t add the same interest twice.
Before counting unused rego or insurance as a loss, ask about any refund or transfer that applies to your situation. Only include the costs you’ll actually be left paying.
Don’t promise the keys before you know the dates
A car you’ve agreed to buy isn’t necessarily a car you can collect tomorrow. Find out whether it’s ready, whether any work is outstanding and whether the delivery date is firm or estimated.
Your purchase contract matters here. NSW Government guidance on vehicle contracts explains the importance of written deposit and finance conditions. Check the rules that apply in your state rather than assuming you can cancel if something changes.
For a private purchase, arrange an independent inspection and do a PPSR check on the purchase day or the day before. Once the dates look workable, agree when payment is due, when funds should clear and when you’ll hand over each car. A payment screenshot isn’t a substitute for checking your account.
Get the documents required to sell your car together ahead of time. Check which registration transfer or disposal steps you need to complete, and put your rego, service or warranty dates alongside the plan. Keep maintenance current while you’re still using the car.
Selling to Cars24 while you arrange the next car
You can sell your car to Cars24 without buying your replacement from us. That helps if you’ve found something elsewhere and want to deal with the sale separately.
We assess the car through inspection and verification before agreeing the purchase amount. Tell our team about finance owing and when you’ll need the car until, then confirm payment and handover arrangements before agreeing dates elsewhere.
Frequently asked questions
Can I keep driving after accepting an offer?
Continued use needs to be part of what you agree with the buyer. If you need the car for another fortnight, say so before accepting. Check the handover date, any kilometre limit and what happens if the condition changes.
What if the next car is delayed after I’ve sold mine?
Contact the seller and find out what your contract allows. If you haven’t handed over your old car, ask its buyer whether the date can move. Get any revised arrangement in writing. If that isn’t possible, compare temporary transport options; a delay doesn’t automatically make cancellation free.
Does my insurance cover both cars while I’m changing over?
Don’t assume it does. NRMA’s guidance says selling a car doesn’t automatically cancel its insurance or move cover to another vehicle. Give your insurer the dates and ask how each car will be covered, including any days when you own both.
I’ve agreed to a trade-in. Can I sell privately instead?
That needs sorting out with the dealer before you sell. Your signed purchase agreement may already include the trade-in, so obtain an agreed written change covering the replacement price and what you’ll now owe.
How long should I leave for a private sale?
Long enough to have another option if it hasn’t sold when you need the money. Choose a review date for the listing and a fallback selling method. An enquiry, an inspection and a buyer saying they’re interested are all encouraging, but none gives you a confirmed payment date.
Is keeping the old car as a backup worth it?
A second car can be useful if it will get regular use. Otherwise, add up the rego, insurance and maintenance before keeping it indefinitely. The question is what it will do for you now, rather than how much you’ve already spent on it.
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