In 2016 alone, almost 41 million used cars were purchased. But, the hard truth is, there’s not one right answer for everyone when it comes to buying a used vehicle.
The answer will depend on a variety of factors and personal preferences, including budget, car quality, your needs, and more.
Luckily, you don’t have to feel stumped about which option is best for you.
Let’s review 5 essential pros and cons of buying a used car so you can make the best decision for yourself.
1. Pro: Purchase Cost
The first, and probably most obvious, pro of purchasing your next vehicle used is the savings. As most car-buyers are aware, vehicles depreciate in value the minute you drive them off the lot.
This is why purchasing a car that’s already been owned and driven around by someone else will always cost less than buying brand new from a dealer.
Those first three years in a new car’s life are the most important as far as value is concerned. A car’s value decreases by an average of 50% in those first three years after it’s purchased new.
Looking at a car’s residual value will be especially influential. If the car you’re interested in has a residual value that depreciates very quickly (and not all cars are the same), you will usually be better off purchasing that car used.
The car itself isn’t the only thing that’s cheaper when buying used. Insurance is also generally less expensive when covering an older or used car. Of course, costs vary depending on where you live, but you can discover more about buying insurance for a used vehicle in your specific area.
2. Con: Less Option Control
Arguably, one of the most fun parts about buying a brand new car is choosing your options. What color, model, interior fabric, CD player versus iPod, etc. do you want?
Those choices are not as available to you when purchasing a used vehicle.
Your options are more narrow and it may take longer to find the used car that perfectly suits your needs. It may even mean having to compromise on some features you’d really like.
3. Pro: Finding a Manufacturer Certified Pre-Owned Program
If you decide a used car is the best option for you, we recommend doing your best to choose a make and model that comes with a manufacturer’s certified pre-owned certification.
It can be risky when buying a used car as you may sometimes have to rely on the honesty of the previous owner to inform you of any problems or previous accidents.
If the used car you’re looking to purchase carries with it a certified pre-owned program from the car manufacturer, you’re assured the comfort and peace of mind in knowing that your car has been through inspections and checks before it’s re-sold.
We also recommend making sure your used car still has it’s auto-repair manual. Most drivers keep this information in the glove box, but if it’s a much older car, being sure you have this manual can really save your skin if repairs or fixes become necessary.
If your used car is missing its repair manual, we’ve got you covered. We have a comprehensive list of online car repair manuals by make and model.
With a manufacturer certified pre-owned program, any repairs or problems with your used car are fixed by the manufacturer themselves.
In fact, the manufacturer is actually held accountable for these so you’re looking at a faster and more thorough repair process.
Of course, without this pro, you’re looking at the unfortunate con of buying a lemon…
4. Con: Buying a Lemon
Here we are, the dreaded used-car buying con of them all — finding you’ve bought a dud.
If you don’t get your used car inspected first, you may find down the road that it has existing issues or costly repairs or parts needed. It would be a bummer to think you’ve saved by purchasing used, only to make up for that cost difference with repairs.
You can also avoid this problem by getting a complete repair and damage history on the vehicle from its previous owner. You need to be aware of any accidents the car has been involved in.
You can avoid this con and still save on a used car by making sure your car comes with a warranty and program for regular service.
When purchasing a new car, the dealer provides both a warranty and service program. But, if you buy used from a used-car dealership instead of a private individual, you can still often receive both.
5. Con: Higher Financing Cost
In reality, there are several financial factors related to buying a car. It’s important to look at more than simply the cost to purchase the vehicle when you’re deciding whether a new or used car will best fit within your budget.
One important cost that can sometimes be overlooked by potential buyers is the financing cost.
Also known as the COF, or cost of finances, this included the total cost of purchasing your car including the interest your loan will accrue and other small expenses that sometimes wrack up when you’re borrowing money.
Sometimes expenses like the salaries of those working on your loan or financing fees that an intermediary financial institution will charge are also included.
It’s important to note that most often, lenders charge a higher financing rate for car-buyers looking to purchase a used car.
New cars carry with them the advantage of lower interest rates. If you’re smart and decide to purchase a new car during a big sales event, you can even find incentives that offer rates as low as 0%.
More Pros and Cons of Buying a Used Car
Depending on the type of car you wish to purchase, and your needs or your family’s, there may be many pros and cons of buying a used car to consider.
At the end of the day, if you buy smart, get a great used-car warranty, and make sure the vehicle passes a mechanic’s inspections, you can save thousands by choosing to purchase a used car.
For more car-buying tips, check out our blog.