Your car is costing you more to fix than a car payment and it is time to buy another vehicle. The question in your mind, should I buy a nice used car or a brand new one? This is a question many people ask themselves, so I decided to share with you a list of Pro's & Con's on both new and used auto purchases.
Tired of breaking down and the cost of repairs? A new car comes with a comprehensive warranty. It can cover you from mechanical failures for 3-4 years or a typical 25,000 to 48,000 miles. Hyundai comes with a 10 year: 100,000 mile warranty. Here is a list of the top new car warranties:
Latest Gadgets & Features
New cars have the latest features from phone, internet and TV options to music playing features. Here is a list of the coolest features on cars in 2016: http://www.forbes.com/sites/jimgorzelany/2015/12/08/the-hottest-2016-new-car-features/#32f2e0c12536
A new car won't have bumps and tears. The tires are brand new and it has the new car smell.
Higher Price: A new vehicle will always cost more than a used vehicle.
Depreciation: As soon as you drive your vehicle off of the lot, it depreciates. What does that mean? It means you lose on average 11% of its value. Example if you purchase a vehicle for $20,000 you can lose as much as $2,200. Here is a car depreciation calculator:
Higher Taxes & Fee's: With a higher buying price, you will pay more in taxes and fee's. Here is a tax & tag calculator:
Lower Price: A used car will always cost you less but you don't want to overpay. To check out how much the car you are looking at to buy is worth and can be financed for , go to this site to calculate: http://www.kbb.com/
Lower Depreciation: Used cars will also depreciate but they depreciate the most in the first 3 years. Slower depreciation happens with used cars and some cars carry their value for a while. Here is a list of the Top 10 slowest depreciating cars: http://www.autoguide.com/auto-news/2015/04/top-10-slowest-depreciating-cars.html
Higher Interest Rates on Used Cars: A loan for a used car may carry a higher interest rate than for a new car. Also, cars more than seven years old might not qualify for financing.
Very limited or NO Warranty: If you purchase from a private seller, your car most likely is sold "AS IS" and will not carry a warranty. A dealer may or may not offer you a warranty on a used car but it will be very limited and very specific on what it covers.
Fewer features than a New Car: When you buy a used car, you get years gone by features. Sometimes, the old features won't even work anymore.
Used Cars Can Have Higher Maintenance: If you buy a car 5 years or older, it may need more maintenance including oil changes, need new tires, tires rotated and changing your filters.
Here are a few things you can do to reduce your risk when buying a used car:
Thoroughly review all maintenance documentation.
Inspect the car during daylight hours.
Test drive in highway conditions.
Consult a service such as Carfax to determine if the car has been in an accident or otherwise damaged.
Have a mechanic inspect the car before you pay.
Buying a vehicle is a major purchase. Do your homework before you buy!
By: Lori Cummings [email protected]