Trading in your vehicle won’t necessarily hurt you during the car buying process unless you have negative equity, in which case you may not be able to trade it in at all.

If you're buying a vehicle and have an old used car to get rid of, your first thought may be to trade the old car in towards the new purchase. However, as an alternative, you could donate your car to a qualifying charity.

Living in Phoenix, Arizona definitely has its perks. There's a lot to see and do, and the weather is great almost year-round. However, most Valley of the Sun residents do find that they need a car in order to get around.

Recently, Kelley Blue Book (KBB.com) announced the winners of its 2017 Resale Value Awards. Toyota was the big winner this year, claiming the title of Best Resale Value Brand for the first time since 2014.

There’s no specific time frame you need to follow, but the general rule of thumb is to wait until your car has equity before you go to trade it in.

When it comes to trading in your vehicle, there are some important steps to take. You may think your car is trade-in ready, but dealers are the ones who determine its value.

If there is equity in your current car, you can use this equity as a “cap cost reduction” on a lease. In this situation, you would basically be selling your vehicle to the dealership or leasing company. The money from the sale could then be used as credit toward your monthly lease payments.

More and more consumers are trading in their cars when they still owe money on them. And the amount of money they owe continues to increase. This is a dangerous trend that has consequences which can snowball, especially if you are dealing with less than perfect credit.

According to a report from Moody’s Investors Service released last week, negative equity is at an all-time high. Lenders continue to allow consumers to roll over negative equity into their next car loan at trade-in. Moody’s believes this practice has created what they call a “trade-in treadmill,” because it traps consumers in a cycle of never-ending negative equity on each successive car purchase.

Is it possible to trade in your car even if it has not been paid off yet? That depends on several factors, including the lenders the dealership is signed up with, the amount of negative equity, the state of your credit, and more.