What does a “sales haircut” mean?

A “sales haircut” is the difference between the private sale value of a car and its trade-in value.

When a donated car is sold by or for a charity, normally it’s sold at auction or for scrap. The sales price will be less than the private sale value. The sales haircut is the difference between the private sales value and the sales price. To estimate the sales price for your car, the Calculator uses its trade-in value.

The formula for what the charity receives from the sale of a donated car looks like this:

  • private sale value
  • minus sales haircut
  • minus dealer charges (percentage)
  • equals proceeds to the charity.




Posted in: Car Donations