Often when looking to economize on a car purchase consumers will look to save money by purchasing a used car. This advice comes from the fact that once you drive your new car off the lot it has lost some of its value. This is not always a good idea. There is no denying this is true, but there is more than meets the eye.
At a glance that statistic may sound pretty discouraging, but there are other factors that make the difference in value smaller. As we have written about before there aren’t as many used cars as there used to be. This pushes the cost of a used car higher. What this means is the average used car has been used for longer than it used to be and therefore may not be as reliable.
It is a very well kept secret in the automotive industry that it costs more to get a loan on a used car than it does a new car. It is not just the interest rate that may be higher. Your monthly payment could be lower on your new car because lenders, including those here at BlueSky Auto Finance, will likely give you more time to pay off your loan. People are more likely to give their new cars or light truck tender loving care, and as a result are less likely to stop making payments on their loans according to the Transunion credit bureau. New cars are also less likely to face mechanical issues causing the car to stop running.
Many new cars have what is practically a ‘worry-free’ period as many defects will be covered by the manufacturer’s warranty. On the other hand if you buy from someone you met on Craigslist, the car may be sold “As Is” meaning aside from applicable consumer laws known as lemon laws the seller is making no warranty as to the condition of the vehicle. If your car stops running you will have a hard time getting the money you used to buy the car back, in your pocket. And, you will still have the responsibility of driving the kids to soccer practice and commuting to work in a potential lemon car. This is much less likely to happen with a new car purchase.
One more thing – let’s not forget… it feels good to drive off the lot with a brand new set of wheels because of the peace of mind that comes with the purchase. What are you waiting for? Apply now!