Having adequate knowledge of the available car models, their price ranges, and the buying process is enough to make a good deal. It’s the choice between a new or used car that often stops shoppers and stalls the buying process. In order to clear your doubts, and to help make the right choice for your unique situation, we’ve compiled a few benefits and drawbacks associate with each type of purchase.
Advantages of Buying New
It is an undeniable fact that buying a new car is always advantageous. But the availability of a comparable product (used vehicle), at a lesser price, brings in the need for evaluating the benefits of purchasing a new car. The upside includes:
Reliability: Undoubtedly, you will become the first owner of the car and the best thing you can experience is its long lasting, promising performance. A new car is less likely to develop performance problems or breakdowns; and even if it does have issues, they will be covered under warranty and free services.
Less maintenance: Unlike a used car, a new one comes with a clear history and until it reaches a few thousand miles, it does not require any repairs or maintenance. Free scheduled maintenance programs for a certain amount of time also ensure peace of mind.
Fuel efficiency: New cars nearly always consume less fuel compared to the used ones. Cars with latest technology are more fuel efficient and environmental friendly.
Other features: From brand new gadgets to advanced safety features, new cars come with all of the latest equipment. You can choose your favorite model without having to add any extra features.
Better financing options: Though finance facilities are sometimes available even for used cars, manufacturers offer attractive financing incentives and special interest rates for new cars.
Disadvantages of Buying New
Although these disadvantages are outweighed by the benefits a new car brings, knowing them will help you stay prepared to face the downsides. They include:
Price: For many shoppers, price is not a constraint when it is the best model. But, new cars cost significantly more compared to the used ones.
Depreciation: Depending on the model you purchase, the car loses its value with each passing month and mile. A few vehicles even lose around 45% of their value within first three years. This rapid depreciation is a major disadvantage usually faced by every new car purchaser.
Insurance & other costs: The amount of insurance premium is affected by the price of the car. As the new cars cost much higher than the used ones, the insurance premium will also be high for the new ones. Moreover, tax rates are always high on new cars compared to used cars.
Advantages of Buying Pre-Owned
Used cars are priced lower compared to new cars
Depreciation has already set in, so the loss of value will be much slower
The manufacturer’s certification increases the reliability of the used cars, which make them popular and affordable alternatives for new cars
The cost of insurance and related taxes are much lower for these cars
Certified pre-owned cars offered by authorized dealers will be in better condition due to high inspection standards set by the manufacturer. However, if you purchase them from private dealers, pre-owned vehicles offer an equal amount of risks. These may trouble you after the purchase. Here are few such issues you may face.
Disadvantages of Buying Pre-Owned
Increased chances of getting lemons if purchased from private sellers
Private dealers often conceal the history of used car accidents. Hence, there is an increased chance of getting a car with legal issues or which met with an accident
If you get it on finance, interest rates for used cars are much high compared to new car finance
Maintenance costs like fuel costs, repair costs are always more for used cars
You cannot get latest gadgets and accessories and hence need to spend few more bucks to upgrade your car
If you cannot afford a new car, then it is recommended to go for a manufacturer certified pre-owned car, which can minimize the above mentioned drawbacks.
From all the above observations, it is clear that every purchase has its own pros and cons. All we can do is to choose the car that caters to our needs and makes us feel happy with our purchase. One thing you need to remember here is that you need to approach a reliable dealer to get a better vehicle.