If your car sustains damage in an accident, its value drops permanently. This is true even with minor damage and even if you repair it. If you want to trade in your vehicle later, you’ll probably have to accept less than you would before the accident, even if your vehicle is in good condition. How much the trade-in value of your car decreases depends on the type and amount of damage, the age and make of your car and the quality of the repairs. Vehicles lost an average 33 percent of their value after an accident, according to the ABC News article “Been in a Car Wreck? Get Reimbursed for Lost Value.”

How Much is My Car Worth?

How Dealerships Know You’ve Had an Accident
Even if you’ve erased all visible signs of your vehicle’s damage by having it repaired, auto dealerships probably will know about it. Many dealerships run a vehicle history report on any vehicle brought in for a trade-in. This report shows a vehicle’s entire history, including accident reports. Insurance claims also show up on vehicle history reports, so if your car’s damage was significant enough that you filed an insurance claim for the repairs, any dealerships looking at your car’s report will see that and probably lower the amount they offer you.

Age and Make of Your Vehicle
Damage most significantly reduces the trade-in value of newer cars. Older vehicles have already depreciated so much that an accident is not likely to lower the car’s value much more. The make of your car also significantly affects the trade-in value. Some cars are in such great demand that dealerships know they can probably sell them even if they’ve been damaged. In this case, the dealership might not significantly reduce its trade-in offer. If there’s not much demand for your make and model of vehicle, however, the dealership might have difficulty selling it even without damage, and probably will offer a much lower amount if there’s damage.

2. How much value has my vehicle lost due to its recent accident.
The loss in value of a damaged vehicle is known as Diminished Value. The amount of Diminished Valueof a damaged and repaired vehicle depends upon several factors including: the pre-loss value of the vehicle, the nature and severity of the damages and the cost, manner and thoroughness of the performed repairs.
Consider that, when a vehicle is in an accident, it loses its greatest value just after the actual impact or occurrence. During the dismantling, repair, installation and painting of replacement parts, the value is slowly restored as the repairs progress.
The full original value will likely never be regained simply because the vehicle now has a history of damage that it did not have before the loss. Prior damage history will be disclosed to potential buyers who will likely not pay the same for a vehicle with a damage history as compared to one with no damage history. This is often referred to as “the damaged goods syndrome”.
If the repairs are done thoroughly and in a workmanlike manner, the value of the vehicle can be maximized to the best of reasonable human ability but likely never to its pre-loss value.
If the repairs are done to less than thorough and workmanlike standards, the recovery in value will be limited accordingly, and the vehicle will suffer a greater loss or diminishment in value.
The more significant the damages, the greater the loss in value. The poorer the repair quality, the less recovery of the vehicle’s original and pre-loss value.

3. How will damage history affect my trade-in or the sale of my vehicle?
Under most state laws, every auto dealer is to disclose an accident history on a vehicle to a potential buyer. To be in compliance, and avoid lawsuits, they are often careful to ask regarding the damage history from the prior owner and may even have the owner sign an affidavit. After disclosure, most buyers are not willing to pay the same amount for a vehicle with an accident history as they would for the same vehicle without an accident history.