Demand for used cars has increased in recent years, and this means dealers will pay more for trade-ins. The National Automobile Dealers Association (NADA) Used Car Guide's latest report indicates smaller, fuel-efficient vehicles are seeing the biggest returns upon being traded in since more drivers want used cars with decent fuel economy.

"While prices for all used-vehicle segments will remain stable over the next two months, compact and mid-size cars will appreciate in value and outpace other segments because of rising gasoline prices, shortages of inventory and strong consumer demand for fuel-efficient vehicles," said Jonathan Banks, executive automotive analyst with the NADA Used Car Guide. "The most advantageous time this year to trade in a used car will be April through May because values will be higher."

The average trade-in value of compact and mid-size vehicles has increased an average of 2.6 percent (roughly $300) from March to April. This is also 4.3 percent higher than trade-ins were worth at the start on 2012. NADA indicates some cars are certainly worth more than others. For example, a driver who traded in a 2009 Toyota Prius in January could have expected about $13,750 for their vehicle, given that it was in good condition. This month, the same car would be worth approximately $15,675, which is a value increase of nearly $2,000.

Drivers looking to trade their current models and get a different car can head to New Jersey State Auto Auction. The dealer is and authorized Autotrader.com marketplace, so motorists will know they're getting the best value for their used cars.