New Car Vs. Used Car

Should you buy a new car… or should you buy a used car?  The answer is:  It depends. Sorry.

Let’s look at some of the things that may help you make your decision.

This could be a great used car...right?

New cars today do have very impressive warranties.  And, quite frankly, new cars built today are built much better than they were a generation ago.  But, used cars also come with warranties.  Sometimes it’s the remainder of the hefty warranty from when it was new, and other times you can purchase an additional warranty for used cars.

Used cars are always cheaper than new cars… in a perfect world.  But, if you’ve learned anything about the economy in the past few years… things aren’t always what they seem.  Interest rates on new cars can be quite low right now, sometimes even 0%.  Interest rates on used cars are almost never as low as new, which could mean both a higher payment each month, and a higher total cost of the car at the end of the loan.

New cars are typically in top condition, and your risk of something going wrong should be relatively low.  However, with so many manufacturers offering pre-certified used cars, the risk of trouble with many used cars is also relatively low.

On a strict apples-to-apples comparison, a good used car will almost always be the better financial deal.  But, according to bankrate.com, if you expect to hang onto a car longer than most, and are looking for a more robust warranty, a new car may make more sense.  BankRate, Edmunds, and Cars.com all have great tools to help you through the process.