# What happens if my trade-in vehicle is in an accident **URL:** \ **Category:** Factual Questions\ **Created:** [February 18, 2014, 3:13pm UTC](https://boards.straightdope.com/t/what-happens-if-my-trade-in-vehicle-is-in-an-accident/681624 "2014-02-18T15:13:57Z")\ **Posts on this page:** 20\ **Page:** 1
**Author:** ![bizerta](https://avatars.discourse-cdn.com/v4/letter/b/3be4f8/32.png) [@bizerta](https://boards.straightdope.com/u/bizerta)\ **Post date:** [February 18, 2014, 3:13pm UTC](https://boards.straightdope.com/t/what-happens-if-my-trade-in-vehicle-is-in-an-accident/681624/1 "2014-02-18T15:13:57Z")
I just bought a new car and traded in a 15 year old car. The sale completes in two days. Although the dealer gave me $2700 for my old car, I think he’s really would have taken $1700 off the purchase price for cash. This means, he’s really only giving me $1000 for my car. (It’s a diesel. If it were a gas car, it would be worth $500). My son has expressed an interest in my old car as his spare, so I’m about to approach the dealer and ask him if he would take $1000 more in lieu of the trade-in. But it got me to wondering … What happens if the trade-in vehicle (which has no collision insurance) is in an accident between the negotiated deal and the actual exchange of new-for-old? ---
**Author:** ![GaryM](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/garym/32/241_2.png) [@GaryM](https://boards.straightdope.com/u/GaryM)\ **Post date:** [February 18, 2014, 3:21pm UTC](https://boards.straightdope.com/t/what-happens-if-my-trade-in-vehicle-is-in-an-accident/681624/2 "2014-02-18T15:21:10Z")
Unless you can renegotiate the deal I believe you’d need the trade in amount in cash. ---
**Author:** ![Kimballkid](https://avatars.discourse-cdn.com/v4/letter/k/b5a626/32.png) [@Kimballkid](https://boards.straightdope.com/u/Kimballkid)\ **Post date:** [February 18, 2014, 5:27pm UTC](https://boards.straightdope.com/t/what-happens-if-my-trade-in-vehicle-is-in-an-accident/681624/3 "2014-02-18T17:27:48Z")
Maybe I’m naive, but I’ve never heard of a car sale taking two days. All the deals I’ve ever made have been done the same day. I didn’t even know that was possible. Can someone still come in and buy the new car out from under you? ---
**Author:** ![Exapno\_Mapcase](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/exapno_mapcase/32/1051_2.png) [@Exapno\_Mapcase](https://boards.straightdope.com/u/Exapno_Mapcase)\ **Post date:** [February 18, 2014, 5:39pm UTC](https://boards.straightdope.com/t/what-happens-if-my-trade-in-vehicle-is-in-an-accident/681624/4 "2014-02-18T17:39:26Z")
> [@Kimballkid](#): > > Maybe I’m naive, but I’ve never heard of a car sale taking two days. All the deals I’ve ever made have been done the same day. I didn’t even know that was possible. Can someone still come in and buy the new car out from under you? New cars often require prep before sale. You don’t always test drive the one you plan to buy. Most dealers keep one car for that, so the rest don’t get extra mileage put on them. That one may be sitting on a back lot, still covered in plastic. It needs to be cleaned, washed, tested, checked out by a mechanic. Nobody will buy that particular car but you, but that doesn’t mean it’s ready to drive off the lot. And the answer to the OP is yes. If something happens to your car in the interim you’re SOOL. It’s happened to me. ---
**Author:** ![iamthewalrus\_3](https://avatars.discourse-cdn.com/v4/letter/i/258eb7/32.png) [@iamthewalrus\_3](https://boards.straightdope.com/u/iamthewalrus_3)\ **Post date:** [February 18, 2014, 5:39pm UTC](https://boards.straightdope.com/t/what-happens-if-my-trade-in-vehicle-is-in-an-accident/681624/5 "2014-02-18T17:39:32Z")
> [@bizerta](#): > > I’m about to approach the dealer and ask him if he would take $1000 more in lieu of the trade-in. Go for it. Until you’ve all signed the contract, you can renegotiate as much as you want. > [@](#): > > But it got me to wondering … What happens if the trade-in vehicle (which has no collision insurance) is in an accident between the negotiated deal and the actual exchange of new-for-old? Clearly, you wouldn’t get the previously-agreed-upon deal, since I’m sure it requires the trade-in vehicle to be in essentially the same condition it was as when the agreement was made. Basically, you’re asking what happens if one party doesn’t go through on a contract. If the other party can show damages, then you have to make them whole. If you haven’t gotten the new vehicle yet, I doubt there are any damages. You either renegotiate a new, lower value for the wrecked trade-in, renegotiate without it, or both walk away. ---
**Author:** ![Kimballkid](https://avatars.discourse-cdn.com/v4/letter/k/b5a626/32.png) [@Kimballkid](https://boards.straightdope.com/u/Kimballkid)\ **Post date:** [February 18, 2014, 5:44pm UTC](https://boards.straightdope.com/t/what-happens-if-my-trade-in-vehicle-is-in-an-accident/681624/6 "2014-02-18T17:44:25Z")
> [@Exapno\_Mapcase](#): > > You don’t always test drive the one you plan to buy. I have except for one time when they had to order one from another dealer, because I wanted certain things on it ,and that did take a couple of days, so I did have the trade-in for longer. I forgot about that one. ---
**Author:** ![Exapno\_Mapcase](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/exapno_mapcase/32/1051_2.png) [@Exapno\_Mapcase](https://boards.straightdope.com/u/Exapno_Mapcase)\ **Post date:** [February 18, 2014, 5:55pm UTC](https://boards.straightdope.com/t/what-happens-if-my-trade-in-vehicle-is-in-an-accident/681624/7 "2014-02-18T17:55:25Z")
> [@Kimballkid](#): > > I have except for one time when they had to order one from another dealer, because I wanted certain things on it ,and that did take a couple of days, so I did have the trade-in for longer. I forgot about that one. I’ve wound up with cars that had to be manufactured at the factory to get the items I wanted, and that took months. You don’t see that very much any more because almost everything is bundled into packages and those few variations can almost always be found on some dealer’s lot. It used to be very common, especially for foreign cars. I thought the couple of days of prep was standard any dealership large enough to have inventory. I’m surprised that you would walk out the door with something you tested. ---
**Author:** ![bizerta](https://avatars.discourse-cdn.com/v4/letter/b/3be4f8/32.png) [@bizerta](https://boards.straightdope.com/u/bizerta)\ **Post date:** [February 18, 2014, 6:19pm UTC](https://boards.straightdope.com/t/what-happens-if-my-trade-in-vehicle-is-in-an-accident/681624/8 "2014-02-18T18:19:37Z")
> [@Kimballkid](#): > > Maybe I’m naive, but I’ve never heard of a car sale taking two days. … OP here. As an FYI, to buy back my trade in (and pay for the new car with cash), they wanted more than I was willing to pay so I told them the old car would return on Thursday when I pick up my new car. The red tape at the RMV in Massachusetts is never a same-day process. I had to contact my insurance company who had to stamp my registration application. Thence a trip to the RMV by the dealer’s runner, etc, etc. In my case, I negotiated the deal on Sunday and Monday was a holiday. I was the one who requested four days because I use my own bank for financing and they were closed until this morning. > [@Exapno\_Mapcase](#): > > New cars often require prep before sale. You don’t always test drive the one you plan to buy. … Dealer prep usually takes a day. However, I always drive the car that I intend to buy. I had a car buck once on a test drive. The dealer told me that the car hadn’t been prepped and that a tune-up would take care of the problem. After purchase, the car ran flawlessly for four months and then started having minor problems frequently. Ever since then, if there is any problem whatsoever on the test drive, no matter how minor, I move on to another car. ---
**Author:** ![Doctor\_Jackson](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/doctor_jackson/32/32_2.png) [@Doctor\_Jackson](https://boards.straightdope.com/u/Doctor_Jackson)\ **Post date:** [February 18, 2014, 9:51pm UTC](https://boards.straightdope.com/t/what-happens-if-my-trade-in-vehicle-is-in-an-accident/681624/9 "2014-02-18T21:51:49Z")
> [@bizerta](#): > > But it got me to wondering … What happens if the trade-in vehicle (which has no collision insurance) is in an accident between the negotiated deal and the actual exchange of new-for-old? Who has possession of the trade in vehicle during the 2 days? If you, then you are certainly responsible for any damage that occurs and it may affect the deal. If the dealer has it it gets a little murkier. It would depend on things like negligence, date on bill of sale, etc. ---
**Author:** ![obbn](https://avatars.discourse-cdn.com/v4/letter/o/d6d6ee/32.png) [@obbn](https://boards.straightdope.com/u/obbn)\ **Post date:** [February 19, 2014, 3:50pm UTC](https://boards.straightdope.com/t/what-happens-if-my-trade-in-vehicle-is-in-an-accident/681624/10 "2014-02-19T15:50:41Z")
This very thing happened to me in 1987. I had just negotiated a desk on a new Porsche 944, trading in my 1986 Toyota MR2. I was on my way to the dealer to drop of my trade and pick up my new Porsche and I was rear ended. The accident squished an already tiny car. The damage was repaired and the car accepted for trade, but I had to come out of pocket with another $2500 to cover lost value of the Toyota. Insurance covered the repair, but I’m wondering if insurance should have also covered the diminished value. I hues not because they didn’t, but I was young and wanted my new Porsche, so I didn’t sweat the details. Yeah, I was young, young and stupid. ---
**Author:** ![Really\_Not\_All\_That\_Bright](https://avatars.discourse-cdn.com/v4/letter/r/e8c25b/32.png) [@Really\_Not\_All\_That\_Bright](https://boards.straightdope.com/u/Really_Not_All_That_Bright)\ **Post date:** [February 19, 2014, 4:14pm UTC](https://boards.straightdope.com/t/what-happens-if-my-trade-in-vehicle-is-in-an-accident/681624/11 "2014-02-19T16:14:08Z")
> [@Doctor\_Jackson](#): > > Who has possession of the trade in vehicle during the 2 days? If you, then you are certainly responsible for any damage that occurs and it may affect the deal. If the dealer has it it gets a little murkier. It would depend on things like negligence, date on bill of sale, etc. It has nothing to do with negligence. It would depend on the form of the agreement between the buyer and seller, whether the jurisdiction has adopted certain portions of the Uniform Commercial Code, and if not, how the law of the jurisdiction treats executory sales and requirements for perfecting title. Look up _res perit domino_ (“the thing is lost to the owner”, or more idimatically, “the owner bears the risk of loss”), or if you’re feeling adventurous, this law review article by Professor Williston (discussing the law as it stood pre-UCC): > [@](#): > > In the English and American law of sales of personal property there is curiously little discussion in regard to the risk of property before transfer of title. It was assumed without discussion that the maxim res perit domino was of universal application,1 and this bare assertion has sufficed to fix the law.2 In the absence of agreement to the contrary, the risk is with the seller, though the property be identified, till the moment when title is transferred. If the property is destroyed or injured before that time, the buyer cannot be compelled to pay the price,3 and if he has paid the price in advance, it may be recovered.4 It is well understood, however, that the parties may, by special agreement, fix \*107 the transfer of the risk at a different time from the moment when the title passes.1 > > Thus far it has been assumed that the buyer was not in default at the time of the accident. If the buyer was in default, the seller has several remedies against him. He is generally allowed to treat the goods as the buyer’s, and sue for the price, or he may retain the goods and sue for damages for breach of the contract. If he takes the first course, he becomes a bailee, and if a loss occurs without his fault the buyer must bear the loss; if the latter course, the loss falls on the seller. If the seller has not indicated which course he intends to pursue, the loss would probably fall on him, since the former remedy is the more unusual, and it would not be assumed that the seller was holding the property for the benefit of the buyer unless he had indicated it in some way.2 > > The law in regard to risk in sales of personal property is thus generally settled, and though without discussion, yet probably correctly and in accordance with the intention of the parties. There are a few cases, however, where there is conflict of decision. Suppose the seller delivers the property to the buyer with the agreement that the seller shall retain title until the price is paid, — the ordinary case of conditional sale, — and before the time for payment the property is destroyed. This sort of transaction has become very common of late years, and not infrequently the buyer gives a promissory note containing the statement that the note is given for a specified chattel, the title of which is to remain in the seller until the note is paid. Should the loss fall on the seller because he holds the legal title? > > Samuel Williston, _The Risk of Loss After an Executory Contract of Sale in the Common Law_, 9 Harv. L. Rev. 106 (1895). ---
**Author:** ![Doctor\_Jackson](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/doctor_jackson/32/32_2.png) [@Doctor\_Jackson](https://boards.straightdope.com/u/Doctor_Jackson)\ **Post date:** [February 20, 2014, 4:33pm UTC](https://boards.straightdope.com/t/what-happens-if-my-trade-in-vehicle-is-in-an-accident/681624/12 "2014-02-20T16:33:42Z")
> [@Really\_Not\_All\_That\_Bright](#): > > It has nothing to do with negligence. I was specifically addressing the case where the dealer (seller) already had possession of the trade-in vehicle, even if the sale had not been completed - for example, I left the trade vehicle with the dealer while he prepped the car I was buying. Even if the final sale is not completed until delivery of the purchased vehicle, the dealer is obligated to at least “ordinary care” standards in regard to the trade. If the dealer is negligent in storing my car they can be held liable for damage incurred due to their negligence. ---
**Author:** ![Really\_Not\_All\_That\_Bright](https://avatars.discourse-cdn.com/v4/letter/r/e8c25b/32.png) [@Really\_Not\_All\_That\_Bright](https://boards.straightdope.com/u/Really_Not_All_That_Bright)\ **Post date:** [February 20, 2014, 5:03pm UTC](https://boards.straightdope.com/t/what-happens-if-my-trade-in-vehicle-is-in-an-accident/681624/13 "2014-02-20T17:03:52Z")
Yes, but that doesn’t affect the underlying _sale_. The negligence claim would exist independent of the sale, because that would be a trespass to chattel. ---
**Author:** ![DrCube](https://avatars.discourse-cdn.com/v4/letter/d/a3d4f5/32.png) [@DrCube](https://boards.straightdope.com/u/DrCube)\ **Post date:** [February 20, 2014, 8:05pm UTC](https://boards.straightdope.com/t/what-happens-if-my-trade-in-vehicle-is-in-an-accident/681624/14 "2014-02-20T20:05:08Z")
For what it’s worth, I had a crappy trade-in, but it was running when they agreed to give me $500 for it. It fell apart on the way to the dealer to pick up the new car, and I had to tow it to the dealership. They still took it though, no questions asked. Not sure how that would have changed if they had offered me more for what they thought was a car in good shape. ---
**Author:** ![md2000](https://avatars.discourse-cdn.com/v4/letter/m/73ab20/32.png) [@md2000](https://boards.straightdope.com/u/md2000)\ **Post date:** [February 20, 2014, 11:05pm UTC](https://boards.straightdope.com/t/what-happens-if-my-trade-in-vehicle-is-in-an-accident/681624/15 "2014-02-20T23:05:33Z")
I had something like this come up as a question. I traded in my old car, bought a new one. I was heading out on vacation, abck in 2 weeks. The dealer wanted to close the deal, get it on the books before month end. So I signed and paid for a car with the intent to pick it up on return from holidays, so why bother registering it until then? My father-in-law, the insurance salesman, says “who pays if it’s damaged on the lot?” God question. It’s my (brand new, exensive) car and the dealer’s insurance would only kick in if they were negligent. If a hailstorm came along, or a plane fell out of the sky onto it, or some kids broke into it and hotwired it, well, that’s me parking my new car at the dealer’s lot. My problem, my insurance. So I insured it right away. In the OP’s case, the answer is logical. You contracted to deliver a car in X condition, or X value. You can’t deliver, you make it right. The dealer can be a dick about it, or more likely try to accomodate you; but you agreed on a price of $Y worth of trade-in you meet that price. Two contracting parties can re-arrange the contract to meet circumstances however they want, provided they both agreee. If they don’t, that’s what courts are for. They might be happy to take cash of $Z\<$Y since cash simplifies their life, but they don’t have to. In a lawsuit, no judge is going to make you find an identcal car. There likely will be no penalties if there is not deliberate intent to ruin the contract. However, he will fix a dollar amount that is fair to both parties. ---
**Author:** ![Really\_Not\_All\_That\_Bright](https://avatars.discourse-cdn.com/v4/letter/r/e8c25b/32.png) [@Really\_Not\_All\_That\_Bright](https://boards.straightdope.com/u/Really_Not_All_That_Bright)\ **Post date:** [February 20, 2014, 11:47pm UTC](https://boards.straightdope.com/t/what-happens-if-my-trade-in-vehicle-is-in-an-accident/681624/16 "2014-02-20T23:47:44Z")
There are _never_ penalties for breach of contract, unless liquidated damages are specified by the contract. To claim “penalties” you need an independent tort. ---
**Author:** ![svd678](https://avatars.discourse-cdn.com/v4/letter/s/53a042/32.png) [@svd678](https://boards.straightdope.com/u/svd678)\ **Post date:** [February 21, 2014, 4:35am UTC](https://boards.straightdope.com/t/what-happens-if-my-trade-in-vehicle-is-in-an-accident/681624/17 "2014-02-21T04:35:48Z")
I bought a new car, and planned immediately to go away for 2 weeks. I didn’t want to leave a new car in an outdoor parking lot for that time, so the dealer loaned me my old car - papers were already done, so he took the risk. I thought it was generous of him. ---
**Author:** ![ThisUsernameIsForbidden](https://avatars.discourse-cdn.com/v4/letter/t/b4bc9f/32.png) [@ThisUsernameIsForbidden](https://boards.straightdope.com/u/ThisUsernameIsForbidden)\ **Post date:** [February 21, 2014, 5:16am UTC](https://boards.straightdope.com/t/what-happens-if-my-trade-in-vehicle-is-in-an-accident/681624/18 "2014-02-21T05:16:04Z")
Also, and this did surprise me when i bought a new car, there is a clause in the contract that the dealer can void the contract after you’ve signed it. It doesn’t seem legal to me, but IANAL. ---
**Author:** ![BrotherCadfael](https://avatars.discourse-cdn.com/v4/letter/b/977dab/32.png) [@BrotherCadfael](https://boards.straightdope.com/u/BrotherCadfael)\ **Post date:** [February 21, 2014, 7:49pm UTC](https://boards.straightdope.com/t/what-happens-if-my-trade-in-vehicle-is-in-an-accident/681624/19 "2014-02-21T19:49:50Z")
> [@ThisUsernameIsForbidden](#): > > Also, and this did surprise me when i bought a new car, there is a clause in the contract that the dealer can void the contract after you’ve signed it. It doesn’t seem legal to me, but IANAL. There’s generally a clause (required by law, I think) that allows you to do the same thing. I think you have three days. ---
**Author:** ![runningdude](https://avatars.discourse-cdn.com/v4/letter/r/e9c0ed/32.png) [@runningdude](https://boards.straightdope.com/u/runningdude)\ **Post date:** [February 21, 2014, 9:01pm UTC](https://boards.straightdope.com/t/what-happens-if-my-trade-in-vehicle-is-in-an-accident/681624/20 "2014-02-21T21:01:14Z")
> [@DrCube](#): > > For what it’s worth, I had a crappy trade-in, but it was running when they agreed to give me $500 for it. It fell apart on the way to the dealer to pick up the new car, and I had to tow it to the dealership. They still took it though, no questions asked. Not sure how that would have changed if they had offered me more for what they thought was a car in good shape. $500 is about its value in metal. They didn’t really take a loss…