Given that you don't have the cash reserves to buy a car outright after selling your VW, I'd go the trade in route. Figure out what you would be willing to take on the VW and don't be scared to walk away from any dealership that doesn't at least come very close (within $500) to your number. Have copies of your car's value from KBB and NADA (maybe true car and autotrader also) to substantiate your requested trade-in value. Luckily, those two cars are both in high-demand, so that should help.
It might help to understand how a dealer values cars before making a fool of yourself with "blue book" numbers and other fantasies, printed from websites. Every dealer has a buyer. This person is responsible for restocking the used side of the shop, and they really couldn't care where their stock comes for, as long as they bought it right. In the case of your VW, after they inspect your car, and do a search for any prior history available to them, they then take a look at what your vehicle would cost them at the local, dealer only, auctions. THIS figure determines the value of their vehicle, and may, or may not, be remotely close to figures from KBB, NADA, or any other "online experts". If they can buy yours for a number that's comparable to their auction costs, they will. If you want $17K, and they are bringing $15.5K wholesale, you aren't getting you number from the buyer, BUT that doesn't mean that you won't close a deal, and tell all your friends that, "they offered $15.5K, but I held out for $17K" Because the buyer forwards their offer to the sales side of the shop, and they do whatever they need to do to make the deal work, if they can. In the end however, the buyer still pays the $15.5 he offered. The spread between the lowest number you are willing to pay, and what the buyer paid for your trade-in comes for whatever padding is built into the car you are buying.
The best way to get around this game? Either sell the VW privately, or spend some time and take the car to a few dealers and ask what they would give you for it? Don't do a lot of talking about how much you owe, or why you are selling, just stick to the facts. If you are seeing a pattern of offers, say in the $16K range, you now have a true value of what your car is worth in your market. Now you have valuable information to use when you trade it in. You know what the buyer is actually willing to pay for your car and you can work your way through all the BS, and figure out exactly what they expect you to pay for the car you are attempting to buy.
