I recently bought a used car. There was nothing wrong with my previous car. As my family grew so did the need for a more spacious car. We were using every available space in the car and still, it wasn’t enough. Therefore, we decided to get a more spacious car.
I owned a reasonably sized sedan, so we knew another sedan would not be the solution. Instead, we decided to get an SUV, a van may have been a more reasonable choice but I am just not ready for that lifestyle.
So when we began our search for an SUV we were faced with two choices, either purchase a brand-new car or get a used car. There are obvious benefits to purchasing a new car, first is the manufacturer’s warranty, this is probably the biggest reason people purchase new cars. Some people like the thought of owning a new vehicle. There is also the peace of mind knowing there is nothing wrong with the car. With a new car, you can eliminate the risk of buying a faulty car.
The other factor in deciding which route to take is the purchase price. A new car is always more expensive than a used car. This leads to a trade-off, buy a new car with no kilometers which will cost more or go with a used car with some kilometers but cheaper.
When we were considering our options, there are a few factors that convinced us to purchase a used vehicle.
Benefits of Buying a Used Car
A new car will lose a large proportion of its value the moment you drive if off the lot. It can be anywhere from 20% to 30%. That is a huge drop in the price in a short span of time. Depreciation is perhaps the largest cost of owning a new vehicle. A new vehicle is unlikely to have significant repair costs and even if there are, you can always fall back on the warranty. Consider this, your car will depreciate more quickly than you can pay down the loan. This is an important point to consider. You may be making payments on a $30,000 car that a year later is worth only say $20,000. Within a year your car loan will be more than the actual value of your vehicle.
A lot of people don’t take depreciation into consideration when purchasing a new vehicle. Depreciation is an important cost to consider and should be part of the decision-making process.
A new car is always going to cost more than a used car. If there is a specific car you are looking for with all the new technology, then chances are you will be paying significantly more for a new vehicle. The other option is to buy a used car with all the features you are looking for at a much lower price after the depreciation has taken its course.
One aspect of purchasing a new car that drove us mad was the freight charges. These charges are an add-on on the actual price of the car. So, when you purchase a new vehicle the actual cost does not stop at the sticker price. Be prepared to pay significantly more than the advertised price.
We, however, paid significantly lower for a used car that had all we wanted plus extras such a panoramic sunroof, leather seats, heated seats/steering wheel, etc. This car would have cost us a fortune had we decided to purchase brand-new.
Warranties provide comfort knowing that you are covered should something happen. All new cars have some sort of warranty. Generally, people think buying a used car means no warranty. This is just not true. There are third-party warranties that provide great coverage for used cars. However, it is also possible to purchase a vehicle with the manufacturer’s warranty. Most manufacturers provide seven to ten years’ warranties that are transferable when the vehicle is sold.
Don’t be fooled into thinking that just because a vehicle has a few kilometers on it, it is going to need a lot of maintenance. Cars these days are built to last. If you are still worried about the condition of the vehicle you are purchasing, then get it checked by a mechanic. Most manufacturers will sell certified vehicles. While this does not mean that the car is going to be trouble-free, it does mean that the vehicle has been inspected by the manufacturer and passed certification.
If you are in the market for a new car, have a look at some used cars. The difference in price alone should be enough to convince you to buy used. Is it worth the price to own a new car? We found a great deal by doing some research. Also, if you are concerned about mechanical and other issues, then I would recommend visiting Car Complaints, this site provides good review of cars.