You need to know what the vehicles are worth. That’s easy for most late model automobiles. You can check at your bank, or credit union, or library, where they probably have a Blue Book in which you can look up the value of your cars.
Or you can jump to the Kelly Blue Book page now. They make you provide all the information on your car twice to get both a retail and a trade-in price (and who doesn’t want both the retail and the trade-in price?) It’s kind of silly, but you can get through it fairly quickly, and you can’t beat the price (free).
You could also check out the National Automobile Bankers Association “CarPrices” service. Also free, and also having its own quirkiness. NABA makes you submit to their server for each aspect of the car. Cumbersome. Really cumbersome.
If you don’t mind doing a little legwork, you could also drive the car by two or three used car dealers and ask them for the price they would pay you for it. The price they give you will be a lowball price, of course, so you might decide to average the prices from two or three dealers and then gross it up by 15% or so.
If your car is leased, the value of the asset to you is difficult to gauge. For the vast majority of leases, the contract purchase price you’ll pay at the end of the lease term is designed to be close to the value of the car at that time. That means you’re not building up any “equity” in the normal sense of the term. I deal often with leases in which the payments due at the end of the lease make the lease a net liability, not an asset.
What does all this mean? It means that if you show the value of a leased automobile as zero, you’re probably being a little optimistic. Valuing a lease for a “typical” late model car, I would start with an assumption of a $2,500 liability, although it’s not unheard for for a lease to have a “negative equity” of $5-8,000, especially if it’s the second or third vehicle that’s been leased. Most people who lease don’t realize how much value they’re losing every time they trade vehicles – it’s really shameful how auto dealers prey on people’s ignorance.
Now what about other kinds of vehicles? Sorry, you’re on your own. If it’s a low-value item like a utility trailer, you probably have an idea what it’s worth, and it’s just not that critical. If it’s a high-value item like a recreational vehicle or an airplane, you may decide it’s worth getting an appraisal, or at least getting two or three dealers to give you a price for it.