A new car might be very tempting, but the strange fact is that greater number of used cars are sold than new ones. Buying new or used, both have their own benefits and drawbacks. Your budget, the amount you can afford as monthly installments, how you want to use the car etc. many such considerations go into taking the decision to buy a car. If you are also one of those thousands, who face this dilemma everytime they go out to buy a car, here are the benefits and drawbacks of buying used or a new car.
Benefits of a buying new car
- The experience of being the first owner and no problems associated with shady pasts, mechanical problems or any accidents.
- The model is latest and has all the recent gadgets, accessories and safety measures.
- The car comes with a comprehensive warranty directly from the manufacturer for a longer duration. So, there is someone to bank upon in case the vehicle gives trouble.
Drawbacks of buying a new car
- The price. It will always be much much higher than a used car.
- The depreciation. The car value will instantly decrease by 20 to 40 percent the moment you buy it.
- The cost of insuring a new vehicle and installing protection measures against theft will definitely increase the cost.
Benefits of buying a used car
- Buying a used car won't hurt your pocket that much. It will definitely be very cheap compared to a brand new model. So, in the same amount as that of a new car one can get higher range models, or maybe a luxury edge.
- The depreciation in used car is considerably less than that of a new car. So, it retains most of its original value when you want to resell it.
- The insurance costs for a used vehicle are less.
Drawbacks of buying a used car
- It is an old car and won't carry the same amount of features and latest gadgets.
- The maintenance, accident and ownership history can't be easily verified, thus making it a risky proposition.
- The maintenance costs associated with a used car are generally higher than a new car. This increases the ownership costs of the car.
The extra costs of a used car loan
Though the used car loan might be of a lesser value due to the low cost of the vehicle, it is definitely not a cheap loan. Here are few things that make a used car loan costlier.