Should I Buy A New Or Used Car?
Is it better to buy a used car or go with a new vehicle? We’ll compare the options of buying a new or used car and give you some good information to help you make an informed decision.
Buying A New Car
When you buy a new car, you won’t have to worry about whether or not the previous owner took care of the vehicle or deal with any hidden issues that may exist with a used vehicle.
When buying a new car you can choose any car you’d like. If there are specific options or colors that you’re looking for, dealers can usually order a car to your exact specifications. But be weary, most cars are marked or priced at a base package and each additional option or upgrade could substantially raise the price of the car and the amount of lending needed to acquire it.
Warranties for new cars are typically better and cover more than those for used cards. Although repairs can be expensive, most warranties cover the first three to five years of ownership or a predetermined amount of miles.
Everyone understands that new cars cost more than used cars. Even with rebates, discounts and dealer negotiation, you will pay a premium for the car. This is also true for the newest model years and the more popular vehicles. Insurance costs are also traditionally higher for new cars, as your insurer will be protecting a greater value.
New cars depreciate and lose value almost immediately. On average, a new vehicle will lose 10 – 20% of the value of the original sales price during the first year of ownership. That depreciations comes right out of your wallet and should be factored into your purchasing decision, particularly if you know you will be trading it in or purchasing a different vehicle within three to five years.
Buying A Used Car
Price is the largest advantage to buying a used car. Regardless of the manufacturer, make, category of the vehicle, age, miles used or anything else, used cars are more affordable.
A used car will also continue to lose value as it ages and you add more miles. However, the year-to-year differential is almost always less with a used car. Where a brand-new car might be worth 30% less than you paid for it by the time two years have passed, your used car will typically lose only about 10 – 15% of its value over the same time period.
Be careful when buying a used car. It may have been in an accident, been poorly maintained, or not serviced per recommended guidelines. Be sure to do your research and request a car history report to get a better idea of the vehicle that you’re considering buying.
A used car won’t last as long as a new car, no matter how well you take care of it. While many used cars come with a limited warranty, those warranties aren’t as long or as robust as new car warranties. It’s important to make regular maintenance a priority for a used vehicle, with special attention to preventative care. Stay on top of issues that could lead to catastrophic engine failure or other breakdowns.
When considering buying a new or used car, there are a lot of important factors to consider, so take your time in making a decision. Consider your budget, along with your needs and wants. Some people choose to only purchase new vehicles. Other people consider cars as simply a mode of transportation. Maybe you fall somewhere in the middle and you want a safe, reliable vehicle, at a fair price. Take time to weigh your options carefully and take the road that’s right for you!
Whether you buy a new or used car, Y-12 FCU is here to help the Knoxville area navigate this major purchase. We do more than just provide financing—we’ve got the tools to help you make the best decision. Our great rates and convenient terms will help you achieve your car-buying goals! Click here to learn more about what we can do to help get you into the ride of your dreams!