Do you have an old unused automobile? And are you planning to determine the salvage value of your car but unaware of how to do it? If yes, then you have come to the right place. We have come up with a comprehensive guide for evaluating the scrap value of your car.
Every car eventually reaches the end of its useful life. When you’re ready to get rid of your old car, you can do it in several ways, including selling it for ‘scrap’ or ‘salvage’. Many people use these two terms interchangeably. However, these are slightly different in their meaning.
Scrap car vs. salvage car: What’s the difference?
Any car that has reached the end of its useful life due to age, damage, or other factors is considered a scrap car. Fixing the cost of these vehicles will be quite expensive so selling them at scrap value would be the best alternative. Therefore, such cars are destined for processing by qualified scrap yard companies.
On the other hand, if a car can still be fixed or repaired to make it drivable again then it is known as a salvage car.
So, the key difference between a salvage and a scrap car is that a salvage car might be fixed and put back on the road. A scrap vehicle, however, will be crushed and sold for parts rather than being put back on the road.
You may also like:
When is the right time to scrap your car?
Nowadays almost all kinds of damaged vehicles can be easily repaired given that unlimited time and money. However, “Car Removal Cash for Car Sydney” don’t advise you to invest extravagant money in repair, if you can buy a new car at a cheaper rate. It’s time to scrap your car if it is heavily damaged and has reached its lifecycle.
Why it is imperative to know the salvage value of your car?
Some might consider their unused car junk while others can earn money out of it. So, any car owner must determine the salvage value of the car rather than throwing it away.
Similarly, if you are planning to salvage your car at any scrap yard, you should be aware of the actual value of your old car before selling it. Knowing the salvage or scrap value in advance will ensure you in getting maximum profit from scrap dealers.
How much money can you make by scraping your car?
It is hard to calculate the exact scrap value of your car because, the value varies based on the make, model, and year of its use.
Similarly, if a car is in good condition, dismantling it into its component parts and selling them separately might increase the amount of money the owner receives. There are a number of variables that affect the price of scrap metal, including:
Model, make and year of manufacture:
• If your car is new or is still in proper function then you can get a better offer.
• Moreover, the model and manufacturing unit of your car also plays a crucial role in deciding the salvage value of your car.
Travel distance to reach scrap yard
• Normally, the processing of scrap metal in your car takes place at a scrap yard.
• And, if it is far away from your location then you might get a low price because they will deduct the transportation cost from the actual scrap value.
Age of your car
• The operational parts of the newer cars can be sold and fetch a higher price for the vendors.
• The scrap value you get is inversely proportional to the number of years it has been used.
To sum up, based on current scrap metal prices, you may expect to receive roughly $100- $200 for your old vehicle considering it has 1.3 tons of weight.
You may also like to read:
How to calculate the salvage value of my car?
There is no thumb rule for the calculation of the salvage value of a car as it depends on many factors. However, you can follow these guidelines for calculating it:
• Look for authorized resources to get the current wholesale and retail price of your used car. The value will be based on the model and manufacturing unit type.
• After that, calculate the current market value of your old car by adding the above two values followed by dividing by 2.
• You can also contact your insurance provider to find out what proportion of market value they use to establish salvage value. Normally, the market value is approximately 75% of the purchase price.
• Finally, multiply the current market value by .25 (i.e.1.00- .75= .25) to get the salvage value of your car.
• Hence, the calculated amount will always be less than what the car is worth in the market right now.
The formula for calculating salvage value
You can easily determine the salvage value of your car by using the following simple formula:
Salvage value (S) = P(1- i) ^Y
‘P’ = Original price of your car
‘i’= Depreciation rate
Y = Number of years the car has been used.
Before evaluating the salvage value, you should know the original price you paid for purchasing the car and the depreciation rate. You can get the information for depreciation rates from your insurance company or by browsing the trusted source.
Still confused? Let’s have a look at the example
Let’s consider, if you bought a car worth $200,000 that has a depreciation rate of 20%, the salvage value after 4 years can be calculated by using the above formula:
Here, original price (P) = $200,000
Depreciation rate (i) =20 %
No. of the year (Y) = 4 years
Now, the Salvage value (S) would be equal to,
S = 200000(1- .2) ^4
S= $ 81920
That means you will receive approximately $ 81920 for your car (bought at $200,000) after four years at a 20% depreciation rate.
Isn’t it easy? Now, determine the salvage value of your car to get a reasonable offer from a scrapper near you.
Sell your scrap car with Car removal cash for a car in Sydney
You can easily sell your car with us. We purchase automobiles in all conditions and ensure that our clients will get the best deal out of their scrap vehicles.
You can bargain for a better price if you know your car has functional parts. Nevertheless, a scrap yard won’t really care as they purchase things according to weight.
However, “Car removal Cash for Car Sydney” will appreciate the actual worth of your scrap car.