Here we tell you what are the Pros and Cons of Buying a New vs. a Used Car, Buying a car isn’t a choice between the smoking hot, brand‐new, imported sports car and the smoking clunker with the for‐sale sign made out of cardboard.
There are a lot of choices to make when purchasing a vehicle.
Some used cars are still under warranty. Some have very few miles on them.
There are advantages and disadvantages to both. Which is better? The question may be, which is better for you?
Pros: New cars have warranties. They cover (typically) bumper to bumper problems, and all major failures are covered.
A used car has often been called “buying the problems they didn’t want to fix” and there is some truth to that.
Also, with a new car, you get all the latest technology, including the latest in gas proficiency.
Sometimes a dealer will arrange for a lower interest rate on a new car.
Cons: As soon as you sign the papers, you lose money.
A lot of money. A new car is worth what it’s worth because it’s new.
As soon as it’s owned the value plummets.
Be careful if you’re buying the first year of a different sort of engine or transmission.
Often the new style doesn’t work well, but you won’t know it for a year.
Pros: A used car has already had that initial depreciation, and you might be able to get a substantial amount of your purchase price
back in resale within a few years.
Insurance rates are lower, interest rates are lower, and you have years of production for that make and model to prove itself.
Cons: It’s been owned. It’s been driven. You don’t know how well it was maintained if it was maintained or why the previous owners sold
You might indeed be buying someone else’s problems.
Cars in this day and age live a long time with nothing but basic maintenance.
Costly repairs are a possibility, but not an inevitability.
You will need to be flexible, and willing to compromise on color and features in order to get the best vehicle for your money.
A general rule of thumb goes like this, “If you can’t pay it off in three years, it’s not your car.”
Regardless of whether you are buying a new or used card, figure out how much your budget will comfortably allow.
Find out what you can expect for that price and remember to add in the interest and go from there.