Trade-In Value

The term trade in value denotes the discount which a merchant is willing to offer as payment for property turned over as part of a bartering deal.

For example, a car dealer may accept a used car as part of the payment for a new car. The discount which the dealer offers when you surrender your used car indicates the car’s trade in value.

Typically, the trade in value of property is lower than its actual cash value, and the merchant makes a profit by reselling the property. Some stores offer trade in discounts as part of government-funded recycling campaigns.

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Daniel Dreier is editor and personal finance expert at moneyland.ch.

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