Should you Buy a New or a Used car?
05 Sep 2018
Whatever you choose, make sure to do your homework
When buying a new car there are a great many things to take into consideration.
Some things – the colour and whether or not the trim matches your favourite jacket, for example – go without saying, but there are other potentially more important decisions you’ll need to make as well.
One of the first choices to make when buying a new car is are you going to buy a brand new car or a second-hand car.
Here’s a look at a few of the pros and cons of each.
There was a time when having a brand new car was a sign of ostentatious wealth, but now that’s no longer necessarily the case.
Thanks to increased availability of a variety of finance options, a shiny new car is within the reach of regular, non-fabulously wealthy people.
New cars are, obviously, more expensive than buying used. However, if you’re going to be taking out some kind of finance on a used car you might want to look into new-car options as well. You might be surprised.
One of the biggest costs with a new car is depreciation. From the moment you drive away from the dealership your car is worth considerably less than it was five minutes ago.
This is only a problem if you’re concerned about the resale value. If you are, a used car might be your best bet – after the first three years depreciation slows down a great deal.
Some cars lose their value faster than others for a variety of reasons, including reliability and desirability. With a bit of research you can figure out which car will both suit your short-term needs and act as a long-term investment.
New cars come with some form of warranty – generally three years, sometimes longer – which covers you for all kinds of potential mishaps.
This is great, and so long as you check the small print and make sure to stay within the T&Cs you needn’t worry too much about your car dying on you.
Used cars, on the other hand, generally come with a much shorter guarantee – if any. This means you need to offset any savings on up-front pricing against costs that could be incurred due to repairs, etc., down the road.
Which leads us nicely to...
For the most part when you buy a new car you can be assured it’s in pristine condition and will be as reliable as it can possibly be. Even if the odd upset occurs, you’ve got that warranty to help you out.
Used cars, on the other hand, are a bit of an unknown quantity. You can use a car checker website to find out certain things about the car – like has the odometer been tampered with, how many owners it’s had, etc. – but that still won’t tell the whole story.
The best way to ensure you’re getting a good deal on a used car and not being sold a pup is to have a mechanic you know and trust to have a look over it before any money changes hands.
Standards for emissions, fuel efficiency and so on change regularly, so a new car is going to be built with the latest specifications in mind.
However, a three-year-old car is probably not going to be that much further behind so this is another area where you’re going to want to do your homework.
If you’re looking for a car loan, it might be time for a Credit ReUnion. With competitive loan rates, there are no admin fees, no balloon payments and unlike some other finance deals, with a credit union personal loan, you own the car from the outset. Check out our blog to find out more about the unique benefits of a credit union loan.
For more information on Credit Union car loans talk to your local credit union or Submit an Online Loan Enquiry