When you have a clunker, there’s always that question that seems to loom over you: should I trade it in or just scrap it? We cover the pros and cons of both options, and how your credit situation could change which direction you take.

Is the Old Car Paid Off?

Should I Junk or Trade In My Old Car?Determining your next step is going to start with whether or not you still owe money on that old car. If you own the vehicle outright, getting rid of that clunker could be as easy as bringing the car and the title to a junkyard and collecting the cash. Owning a vehicle free and clear makes the trade-in process easier, too.

If you still owe on that car, you need to worry about getting a large enough offer to cover your loan balance if you don't already have the money to pay it off. To determine how much you need, you can look up your loan balance or ask your lender for a payoff amount. Once you have that, you can start making calls to see where you can get the best offer.

Pros and Cons of Junking Your Car

If your vehicle is paid off and you simply want to get rid of it, then taking your clunker to a junkyard might be the best option for you. This is also a good option for people who have a car that isn’t drivable. Many people end up scraping their vehicle when the cost to repair it exceeds its value.

Many scrap yards and junkyards take cars apart and sell the working parts, so you're more likely to get an offer from a junkyard than a dealership if your vehicle doesn't run at all. However, the amount you can get varies a lot depending on the junkyard’s current inventory, the desirability of your car, and its overall condition.


  • Quick process
  • Junkyards are easy to find in most areas
  • Negotiations are common
  • They might come pick up your vehicle if it’s not running


  • Offer likely to be lower than the actual value of the car
  • You may need to pay for them to pick it up
  • You need a ride home
  • If they can’t pick the vehicle up, you need to pay to tow it

Before you head to the nearest junkyard, be sure to call around to a few different ones in your area. This way, you can get an idea of what your car’s scrap value is and it can also give you some negotiation power. If your vehicle isn’t running, you should also ask the yard if they can pick it up and what the cost is – comparison shop for that, too!

Pros and Cons of Trading In Your Car

Trading in your car is a tale as old as time – it’s a very common way to upgrade your ride. Out with the old and into the new!

If your old vehicle is still running, it’s pretty likely that the dealer is going to at least give you an offer on it. This offer can be put toward your next car’s selling price to meet the down payment requirement. Trade-ins can be very useful for those with bad credit scores, since subprime auto lenders typically require a down payment.


  • Usually quick process
  • Dealership may offer more than junkyard
  • Usually room for some negotiation
  • Offer can be put toward your next vehicle


  • Dealers aren’t likely to pick up your car
  • May not make an offer if the vehicle isn’t running
  • Offer likely to be less than if you were to sell your car yourself
  • Offer may not be enough to cover your previous loan (if you still owe)

If you want to get an idea of how much you’re likely to get from a dealership, you can check out vehicle valuation websites. Keep in mind that these sites can only give estimates, and the dealer is the one that decides the actual cash value of your trade-in.

What Do You Need Next?

When you’re deciding on what to do with your old car, it’s important to know what you need next.

Was this old vehicle your only one, and do you need another one? How’s your credit score? Are you looking to finance or pay cash for your next car? Answering these questions and figuring out what you need next, can help you decide the direction you want to go in.

If you need another vehicle, then trading it into a dealership is likely a good next step. Trade-ins can lower the amount you need to finance since they can act as a down payment.

Many bad credit auto lenders require their borrowers to have at least $1,000 or 10% of their next car’s selling price in cash or trade-in equity.

If your old vehicle doesn’t run anymore, it’s paid off, and the cost to fix it up exceeds its overall value, then scraping it is likely a good idea. At the very least, some of the cash you could get from a junkyard could help you save a down payment for your next car.

Finding a Dealer With Bad Credit Lenders

While nearly every dealer can take a trade-in, not every dealership has the resources to work with borrowers with bad credit. Instead of driving all over town hoping to run into a dealer for your credit, start right here with us at Auto Credit Express.

We’ve cultivated a nationwide network of dealerships that are signed up with subprime lenders. These lenders look at more than just your credit score, and they’re equipped to work with borrowers in all types of unique credit situations. To get started and get matched to a dealer in your area, fill out our free auto loan request form.