You have decided it is finally time for a new vehicle. Your old vehicle barely gets you from point A to point B and you constantly worry about its reliability. With so many car buying options, where will you purchase your new vehicle from? Will you purchase something that is new or used? You may be surprised to find out that used cars in today?s buying market actually have many advantages over purchasing a new vehicle. They tend to offer better value, warranties, and abilities.
Used cars hold their value better
You have probably heard the fact that a new car loses a large percentage of its value the moment you drive it off the auto dealer lot. This is surprisingly true. That is because the moment you leave the lot with the vehicle, it is considered a used vehicle and can no longer be sold as new. You instantly lose a significant amount of value off of it. When you are shopping for used vehicles, however, you are able to get the true car value. If you were to immediately turn around and sell it, you would likely be able to recoup much of what you just paid.
Better insurance coverages
It is true that insurance providers tend to not cover the full price of your brand new vehicle, when involves in an auto accident. That is because they will only reimburse you for the true car value of the vehicle, which is often not what you paid. If you have a loan, which many new car buyers do, you may be responsible for the gap unless you have some type of gap insurance. You may also find that your car insurance rates are more affordable on a vehicle that is used, because a used vehicle is cheaper to replace in the event of a complete total.
Newer vehicles may provide you with better features and a newer feeling. However, those brand new features come at a price. Because they are so new, the car dealer is less likely to provide you with an extended warranty. When you purchase used, however, car dealers usually offer you longer and better warranties to push the sale of the vehicle. You may find that your used car is covered for longer than your new one, both by the manufacturer and the auto body work company.
Car engineers are also more aware of used vehicle technologies. According to J.D. Power 2015 U.S. Tech Choice Study, 40% of drivers describe blind spot detection and prevention features as their most preferred technologies. Both blind spot detection and prevention features have been around for a couple of years now. Your auto group is more familiar with recalls and common problems with these features, making it easier to fix them. When a problem occurs on a new vehicle, it is usually much more expensive to correct because of the additional diagnostic features.
Lower monthly payments
Your auto monthly payments are dependent on the true car value, plus any additional care packages. However, the lower sticker price of your vehicle, the less your monthly payments will be. Also, many lenders require about 10 to 20% down when taking out a car loan, which can be a substantial amount with new car loans. Choosing a lower true car price, such as a used car ensures that you can afford your monthly auto payments, leaving more money in your pockets.
The National Automobile Dealers Association forecasts a nearly 7% decline in the average used car price to just under $15,000 in 2016 from $16,025 in 2014. This reduction in used cars is not the only reasons that used vehicles tend to be a smarter choice. Used vehicles also hold their value better and for a longer period of time, carry better warranties, have better working technological components, hold up better in insurance claims, and give you lower monthly auto payments. More and more people are opting to purchased used over new for these advantageous reasons.