It’s time for a new set of wheels and you may be wondering if buying a new car vs. used is your better bet. There are several important considerations when it comes to buying a new vehicle. There are advantages and disadvantages to both new and used vehicles. Let’s explore the differences to determine what works best for you.
Advantages of buying a new car
The biggest pro is that it’s new and more dependable. It should be free of any mechanical difficulties and be in tip-top shape. A new car will come with a warranty for a duration of time or mileage amount that should cover any standard mechanical issues. A new vehicle also has updated features that you may not find on older vehicles. This includes the latest technology and safety features that you may not find on used models. When you buy a new car, you can pick the accessories you’d like, so it’s customized to fit your needs. If you want all the bells and whistles, you can get them, but they will cost you. It’s not that way with a used vehicle. That’s not to say you can’t find the used car of your dreams.
Incentives and rebates may be available when purchasing a new car to help offset the cost of the vehicle. Loans for new vehicles often have lower financing rates depending on the lender as well. Benchmark Federal Credit Union offers competitive rates and flexible terms for both new and used vehicles. They are also currently offering a limited-time 60-day deferred payment* on vehicle finance and refinance, as well as a limited-time $50 cash bonus**. This deal may end at any time.
Disadvantages of buying a new car
A new vehicle is going to cost you more in the form of payment than a used vehicle. While it may save you in the long run in repair costs, it will come with a bigger price tag upfront. That shiny new vehicle also costs more in the form of higher insurance premiums. Depreciation is a big con of a new vehicle as well. The saying goes you lose value the minute you drive off the lot.
Advantages of buying a used car
A used car may be a little easier on your budget. The previous owner took the depreciation hit when they first bought it. In fact, you might find an older model of the vehicle you want for half the cost of a new one. A used vehicle doesn’t depreciate nearly as quickly as a new vehicle, so that’s a plus. Depending on your driving record, you should also be able to enjoy insurance rates that are lower than a new vehicle. Used cars have a lower value, so you are paying less to insure them. You may find a used vehicle with great features for a real steal. Buying a used car will also enable you to do research on that specific model and its performance over time since it’s been on the road for a while.
Disadvantages of buying a used car
We talked above about being able to personalize the accessories of a new vehicle to your wants and needs. With a used vehicle, you may need to compromise on features. Reliability may also be an issue with a used vehicle. Depending on the mileage and shape the vehicle is in, it might not be as dependable as you’d hoped. You don’t want to buy a car that’s on its last legs. If you are in the market for a used vehicle, ask the dealer about a certified pre-owned vehicle. They are vehicles that have had a maintenance check and usually come with a limited warranty.
Shop around for a vehicle and an auto loan
Hopefully, we’ve helped you determine whether buying a new or used car is the best option to take you comfortably down the road. Either way, you still need to shop around to get the best deal, both on a vehicle and a car loan. Whether it’s new or used, be sure to negotiate the price with the dealer. There are pros and cons to both. It comes down to your personal preference and financial situation. Tap to learn more about Benchmark FCU Auto Loans and Auto Refinancing or to view Auto Loan Rates.
*Drive Away Happier 60 Day Deferred Payment Auto Loan Promotion is subject to termination at Credit Union’s discretion & without prior written notice. Only available on New & Used Auto Loans; excludes DrivingSense, Indirect, & Title Secured Auto Loans.
**$50 cash bonus coupon valid when financing a New or Used Auto Loan & bonus funds will be deposited into Benchmark Savings within 30 days from loan closing.