You’ve decided that you need a car, but you can’t make up your mind whether to buy new or used. New automobiles and used cars each have their own unique sets of advantages, which is why they each hold such sway. Here are just a few of the many advantages of purchasing a pre-owned vehicle to help you make up your mind.
When you buy a car, unlike almost any other large item, it will be worth less than you paid for it right away (unless, of course, it is extremely rare, in which case it is an investment). This is called “depreciation,” and it happens much more quickly when you buy a new car than when you buy a used one. You can expect that a new car will lose about half of its value in the first three years. So if you buy a used car, which has already lost that value and cost someone else money, you won’t have to go through quite the same problem.
When you sell your used car, it will be worth less than what you paid for it, but the difference won’t be nearly as big as if you had bought it brand new. So, even though a new car may come with a lot of “free” features like built-in GPS systems and parking cameras, it won’t really be free in the end because you will have paid for it through depreciation.
A Good Deal
As a result of this depreciation problem and the abundance of used cars on the market, you can get a great deal if you’re in the market for one. Used cars allow you to stretch your budget far further than brand-new vehicles, regardless of how much money you have to spend. In addition, you will likely pay for a used vehicle in full, saving you a ton of money in the long run, while a new car would likely require monthly payments with a very high interest rate.
Another way that a used car can offer a good deal is if you need a loan for any reason (not to buy the car, but for something else). Why is this? If you need a loan, a secondhand car is great collateral. This is because, over time, it will lose less money, allowing you to borrow more money from it if you need to.
Buying a used car isn’t always a walk in the park. Some could argue that at least with a brand-new car, you know exactly what you’re getting. Every part, including the exterior and the engine, is guaranteed to be in pristine condition. The unknown care the former owners gave the car can cause some apprehension when purchasing a used car. Are you going to be on the hook for the repairs if they weren’t careful when driving it?
Here’s where it’s helpful to have access to certified pre-owned vehicles. Which options you have will depend on the car’s maker, so it’s a good idea to look into this before you choose a make and model. A certified pre-owned vehicle (CPO) is similar to a manufacturer’s warranty, and it typically comes with added perks like a loaner vehicle in the event your vehicle needs repairs and roadside assistance in the event of a breakdown.
This, plus the additional of knowing a good mechanic for car repairs should you need one, can put your mind at rest and help you get the most out of a used vehicle that suits your budget much better than a new one.
Nothing can compare to the selection offered by the used automobile market. Here, you can locate the precise brand, model, color, and styling of car you desire without having to spend a premium for it. If you insist on a particular interior style or color for your new automobile, for instance, you’ll generally have to spend extra to have it. When all the costs are tallied together, customizing a new car can get pricey, and even though your budget may have allowed for a basic model, you might not be able to afford all the extra enhancements you like.
Those enhancements will already be installed in a secondhand vehicle, and the previous owner would have paid for them. A used car with customized features may cost a little bit extra, but it won’t be close to what you would have paid for it when it was new.
Insurance is another cost-cutting measure when purchasing secondhand vehicles. Often, the value of the car decides which rate category the insurance for it will fall into. The higher the cost of the car, the higher the cost of insurance to cover it if it needs to be replaced or repaired. Other criteria, such as where the car is parked overnight and if you have made any claims in the past contribute to the final insurance price, but the key determining factor for cost is the car’s purchase price.
If you are paying less for a vehicle because it is used, you will also pay less in insurance premiums. It is also worth considering if it is cheaper to pay the complete insurance premium at once or monthly; this will vary depending on the insurance company.
Cheaper Registration Fees
There are a variety of ways in which you can cut costs by purchasing a used vehicle; one of these is by reducing the fees required to register the vehicle. When purchasing a secondhand car, they are typically lower. However, this is not always the case; in some areas, you will discover that you are charged the same amount regardless of how old the vehicle is, while in other places, the amount that you pay will be determined by how old the vehicle is. Remember to check this out for your own state before you buy a car because it might make a difference to your budget, and registration fees are something that can easily be forgotten in all of the rush and excitement of buying a fantastic car.
Main Image Credit Photo by Andrea Piacquadio