| New car smell can be added to a used car. Rebates | | | | Two or three points against a $30,000 loan can mean |
| and discounts can make a new car priced like used. | | | | big money on a 4-6 year note. For shorter loans, the |
| There are many different opinions on the advantages | | | | rate is less important. |
| and disadvantages of buying a new car. There are | | | | Loan Term |
| just as many opinions regarding used cars. The real | | | | While the rate is normally lower for new cars, the term |
| question is, "Which car is best for you?" | | | | is usually longer. A prudent buyer can get the same |
| Some very wealthy people have never bought a new | | | | payments on a used car that they can get on a new |
| car in their lives. With so many super-low mile used | | | | car, only for fewer payments. |
| cars out there, what's the point of paying thousands | | | | There is also the option of extending the term on a |
| more for a few less miles? | | | | used car purchase to the length of a new car. |
| Then there are those who refuse to buy used, | | | | Vehicles last longer. There are loan companies that will |
| regardless of their financial situation. They would rather | | | | extend a note to 6 or more years on a 3 year old |
| buy a brand new beater than get into a high quality | | | | vehicle because they expect it to still be running after |
| vehicle that has had someone else behind the wheel. | | | | that amount of time. In those cases, the payments can |
| After all is said and done, it really comes down to | | | | be much cheaper than on a new car. |
| personality and goals when deciding between new and | | | | Peace of Mind |
| used cars. The 20/20 rule applies - 20 percent of | | | | Going back to the new car smell, the new car |
| people will never buy new, while 20% of people will | | | | knowledge is very appealing. A rough driver who |
| never buy used. For the other 60%, this article is for | | | | doesn't do car maintenance and likes to drive 90 mph |
| you. | | | | in their Kia Rio can really hurt a vehicle, even with low |
| Selection | | | | miles. When you buy a used car, you take the risk of |
| Between huge dealer inventories, the option of dealers | | | | getting that car and not knowing the bad things it went |
| trading and bringing in a vehicle from another | | | | through for months until it starts having problems |
| dealership, and custom ordering becoming more | | | | prematurely. |
| popular, the selection factor goes hands down to new | | | | Equity |
| cars. | | | | Vehicles are not like homes. They depreciate, |
| For popular vehicles, it is definitely possible to find a | | | | regardless of what happens to the market. Some |
| used car. The internet makes it simple for someone to | | | | depreciate less than others, but no matter what, every |
| search around the corner or across the country for | | | | day makes it worth less than the day before. |
| that perfect used car. Still, it's nothing compared the | | | | Used cars have already absorbed the initial |
| options available with new. | | | | depreciation and are closer to leveling out on the |
| Price Matters | | | | depreciation scale. The first 2-4 years of a vehicle's life |
| Even in today's ultra-competitive new vehicle market | | | | result in a loss of up to 75% of its original value. In the |
| where MSRP has been replaced by Invoice as the | | | | first couple of years of a standard 5 year note, it is |
| starting mark for price negotiations, a car still loses | | | | nearly impossible to trade in a vehicle that was bought |
| 10%-20% or more of its value the moment it hits the | | | | new with no money down and not have negative |
| street. | | | | equity. |
| Low mile used cars a year or two old can be | | | | With used cars, it is still difficult, but not nearly as hard |
| dramatically less expensive than its brand new | | | | as it is with new cars. |
| counterpart. There are exceptions - Honda, for | | | | Final Thoughts |
| example, tends to lose less off the top because they | | | | How often you trade, how well you negotiate, and the |
| rarely have rebates and their reputation is very strong. | | | | make and model of the vehicle you buy will determine |
| Other than the few exceptions, a used car is normally | | | | a lot regarding the pros and cons of a new or used |
| dramatically cheaper than a new one. | | | | vehicle. Prudent buyers will seek out dealerships such |
| Interest Rate | | | | as New and Used Cars in Oklahoma City to help |
| For the 95% of us who borrow money and make car | | | | determine which is best. |
| payments, interest rate becomes an issue. New cars | | | | If there is no local dealership that is trustworthy enough, |
| are less of a risk for the lender, so their bank rates are | | | | do the research online. Check out Kelley Blue Book for |
| lower than on a used car. The manufacturer loan | | | | new car values and Los Angeles Used Cars | |
| divisions make it even more appealing to buy new with | | | | Memphis Used Cars to compare used car prices. |
| 0% financing available on most vehicles at some point | | | | Information is the key to making a good decision, |
| after their release. | | | | whether you buy new cars or used cars. |