Trading in

[{Dakota}]

If I had a car worth �5k and traded it in for one worth �10k, then I'd just have �5k to pay the seller.

Does this apply the opposite way, so I trade in a �10k car for a �5k car, would the dealer give me �5k back?

[markysngc]

I don't think you would be "trading it in" as such, you would be negotiating a sale of your car and then using those funds to buy a cheaper car, so yes the trader should then give you 5k and wave you off in your 5k car

Probably better to sell private for 11k and then walk into dealer next day with 4k in cash to make an offer on the car though

[tubeway]

Yes - if you trade in a car - the dealership will give you what value you negotiate for your part exchange as part of the deal. If your car is valued at more than your new car - then you will get money back.
If you can sell your car privately you will always be better off (and have a better negotiating position) than if you part exchange - but many people do not want the uncertainty or hassle of doing this.
Remember that the dealership usually does not even want your old car and will normally trade it out (either to traders or at auction) - Part exchanges are rarely a profit centre for car dealerships in my experience (15 years in the motor trade)