There a number of advantages that come with buying a used car. Typically, they are less expensive but may still be in good shape. But buying a used car is still a significant financial commitment, and experts like Jeff Lupient would suggest that you consider the following issues.
The saying goes that cars begin to devalue as soon as you drive them off the lot. It might not happen this quickly, but as a rule, new cars lose about half of their value within the first five years. This means that your budget will go about twice as far with a used car as with new. This can be a great way to go because it not only allows you to have all of the newer safety and design features, but it also might even allow you to have some of the bells and whistles too!
When you buy a second-hand car that is a few years old, you reap the benefits of its depreciation in terms of a significantly lower sticker price. The fact that used car has lost a big portion of its value by the time you buy it has a secondary benefit in that insurance premiums will generally go down for less expensive vehicles. Another advantage of buying used vehicle is that you can research them to get a sense of any known performance or manufacturing issues like recalls or “lemon reports.”
Many dealerships sell certified used cars – although they will probably call them pre-owned or semi-new rather than used. These cars will be more expensive than you are likely to find listed by private sellers, but there are some important advantages – they will be late-model, inspected and refurbished, and will come with some sort of extended warranty. If you decide to go with a private sale, be sure to get the VIN and check if it has been in an accident, or if there have been any reported issues.
Another advantage of buying a used car from a dealership is that you may be able to trade in your old car, and potentially qualify for financing or leasing options to pay for your new one. Otherwise, you will need to draw on savings or secure a loan to purchase a car from a private party. That said, there are some advantages that come from purchasing a car with cash – you immediately own the car outright and don’t have to worry about monthly payments. Given that prices tend to be considerably lower, it may be an option for you to purchase a car outright from a dealer as well.
As you can see, there are a number of benefits that come from buying used – however, even though used cars can save you money, you need to be sure that you have done your homework before signing on the dotted line. You should also be sure that you understand the consumer laws in your state that are in place – or not – to protect you in case something goes wrong with the transaction.