5 Advantages of Buying a Used Car Over New
If you’re in the market for a car, you might be wondering whether to buy new or used. It’s a nice thought to be driving a brand-new car out of the showroom. But is it really the smartest move you can make financially? Here’s a few reasons why used cars represent much better value than new.
Used Cars Save You Money
We’ve all heard the story that new cars lose half their value as soon as you drive it out of the lot. While this is an exaggeration, your brand-new car certainly does depreciate quickly. New cars can depreciate 10% immediately, and 20% in the first 12 months.
Used cars, on the other hand have already been through most of their depreciation stage. Certainly, you can get a great late-model vehicle that’s still under warranty. And it will cost considerably less than the current year’s model.
Also, new cars have plenty of hidden fees, and the price is set. Used car dealers are often highly motivated to sell – and there’s no extra fees.
Mechanically Inspected and Reliable
As long as you’re buying from a reputable used car dealer, you get some added peace of mind. Your car is thoroughly checked and inspected by the dealer. In fact, think about how used car dealers acquire their vehicles. It’s usually through trades, and they’re not going to take possession of something they can’t sell.
Buying from private dealers, however, you don’t get these same assurances. This is why it’s always best to choose a used car dealer with a good reputation.
Used Cars May Still Have a Warranty
New car warranties are becoming more and more generous every year. Some manufacturers are offering a standard 7-year warranty, and some are as high as 10 years. This is great for used car buyers, because you could find yourself in a second-hand car with years to run on the factory warranty.
Buying a late model used car gives you that extra back-up of inheriting some warranty, which takes away some of the worry when buying a used car.
Better Insurance for Used Cars
Insurance is cheaper on used cars. It’s as simple as that. Your car is also more likely to be insured for the full value. Depending on the type of insurance you get on a new car, it won’t take into account the full purchase price. Should your car be written off in the first 12 months, you may owe more on the car finance than your insurance will pay.
For a used car however, insurance is calculated on a legitimate market value of the car. So, as long as you’re not paying more than the market value, you’re getting better value on insurance for a used car.
No Restrictions on Where You Service
Finally, you’re not locked in to any service arrangements with a dealership. If you have a trusted local mechanic you’d prefer to use, it’s totally up to you. It’s important to note that if you’re taking advantage of a transferred factory warranty, you may still be required to use authorised service centres. After the warranty expires though, the servicing is completely at your discretion.
These are just a few of the reasons why buying a used car makes sense, so consider your options very carefully before forking out big money for a new car. The fact is, you can find a used car just as good, for a fraction of the cost.