Ignoring these three dashboard warning lights could slash your car’s resale value

Big factors such as high mileage and damaged paintwork are well known to lower the value of the car, meaning you’ll get less money to put towards your new one.

But what about selling a car with an illuminated warning light?

Well, according to experts, fixing the issues leading these symbols to ‘light up’ may seem daunting, but not doing so could knock up to £500 off your offer when trading in your motor.

This is because warning lights typically point to underlying issues, and lead dealers to perceive your vehicle comes with greater risk and will need work before they can sell it on.

Some repairs can be expensive though. So, whether you’re selling your car privately or to a dealership, when does it make financial sense to fix the issue, versus ignoring it?

Owen Gregory, Vehicle Appraiser at Big Motoring World explains: “When bringing your motor to us for part exchange, we want to know how well the car has been looked after because it directly affects how easy it will be for us to sell it.

“If you’re bringing us a car with a warning light on, it’s a bit of a giveaway of the overall condition of the car. It tells us there could be a problem with it, and that might hinder our ability to sell it quickly.

“Don’t panic if you see a warning light though, as they don’t necessarily indicate a major problem. These are more common than you might think and can just require a simple fix for a minor issue that is relatively cheap to do. Taking care of the issue before you try to trade in your motor can make your car more attractive so it’s definitely worth looking into”.

According to Owen, there are three main warning lights that you need to address before taking your car to a dealer to ensure your vehicle value isn’t massively affected.

• Engine Management Light

There are two types of engine management light you need to look out for. Owen says: “Your engine management light can refer to several faults such as problems with the ignition system, faulty sensors, or an engine misfire, as well as larger issues like the clutch or catalytic converter.

“A red light indicates there is a serious issue, and the car is not safe to drive. The amber light represents a less serious issue which shouldn’t impact your ability to drive the car but either way, both will need addressing.

“Obviously this is quite a wide range of potential issues, so the best thing to do is to contact a qualified mechanic for a precise diagnosis. They will be able to reset the light once the problem has been addressed.”

How much is the potential trade-in value drop?

Owen said: “As a rough guide, our appraisers will deduct around £500 from the offer, though it depends on factors such as the make and model of the car.

“The bottom line is a car with an engine management light will not pass an MOT and is therefore a red flag for dealers, so getting this sorted before bringing it to a dealer will make the car more desirable, meaning more money for you.”

How much does it cost to fix this?

With cars, there’s always the fear that fixes will reach the high hundreds, but the engine management light could be lit by something as minor as the fuel cap being lose, or issues with the spark plugs.

The latter can cost on average £150 to replace, but the loss of value by not fixing this is likely to be a lot higher.

• ABS Light

Another common light that can affect your trade-in price is the anti-locking system light. “Your ABS is incredibly important because it stops you from skidding when braking at high speed," says Owen.

“In emergency situations, it keeps your wheels from getting stuck by monitoring wheel speed using electronics, allowing you to maintain steering control.

How much is the potential trade-in value drop?

“If we see the ABS light on when undertaking an appraisal, we’ll knock off at least £500 on the trade-in price,” Owen explains.

“Given that it’s a computer-controlled system, the fault could be something as minor as a sensor that needs replacing, which wouldn’t come close to £500. It’s important to get this looked at before bringing your car to a dealer because the light indicates an issue and it's a big turn off.”

How much does it cost to fix this?

The good news is that if it is a minor issue such as a faulty sensor, fixing this typically costs close to the £70 mark on average. Fronting the relatively small cost will boost your car’s appeal and your final payout when you go to sell though.

• Service Light

According to Owen, you don’t need to be alarmed if you see the service light comes on. Owen says: “Service lights prompt you that a service is due, which, depending on the manufacturer, should be done between once every 12 or 24 months, or every 12,000 miles.”

“During a car service, components of the car are checked, for example the tyres and brakes and usually involves changing the engine oil and filter, as well as other fluid levels like the engine coolant.

How much is the potential trade-in value drop?

“Regular servicing helps keep your car running smoothly and efficiently and prevents breakdown from worn parts by replacing them. If we see a car with a service light on, it prompts us to reduce the trade-in price usually by around £200.

“When dealers, or anyone for that matter, are looking to buy a car, it’s important they can see a car has been looked after with regular maintenance, so it’s best to book a service if the light comes on if you’re thinking about selling.”

How much does it cost to fix this?

Services typically cost anywhere between £170-£300 depending on your car size and the requirements. A mechanic will update the records in your service book to confirm the work has been carried out, so they can also reset the light.

A good service history tells the car dealer that the car is in healthy working order and is therefore more attractive and could fetch you more money.