Should I Buy a New or Used Car?
Buying a New or Used Car
A new or used car is one of the largest purchases a person makes in their lifetime. A new car can cost upwards of $20,000, and luxury cars are double that. They come with shiny new paint, a bumper-to-bumper warranty, and a smell that can’t be replenished with a jar. But those luxuries aren’t reserved for new cars anymore. Many used and certified vehicles are so close to new that you would be hard-pressed to tell the difference. Consider buying a pre-owned car if it meets your requirements.
Used vs. Certified
A used car comes with its own set of concerns: did the previous owner take care of the car? Was it abused. Did they have kids, pets, or use it as an Uber vehicle? These are tough questions to answer today, because the industry doesn’t regulate that deeply. The only way to know whether the used car you’re looking at is a quality vehicle is by inspecting it yourself. Always ask the salesperson to have the car lifted so you can inspect underneath. Look in the glovebox for trash or other debris that should suggest it wasn’t clean. Look under the driver and passenger seats for dirt that couldn’t be vacuumed. Check out the trunk for damage to the pillars or floor. If you see damage or dirt in any of these areas, it probably wasn’t your grandmother’s errand car.
Certified vehicles are a much better bet, but they are used cars just the same. You’ll have to inspect the cars with the same vigor as you did a regular used car, but at least you’ll have piece of mind knowing the drivetrain will be warrantied for some time to come. All used vehicles should come with a safety inspection from a mechanic, but certified vehicles are required to provide one. Always request a CarFax report as well. You never know what kind of damage is lurking behind a repainted panel or under the trunk carpeting.
New Warranty vs. Extended Warranty
New vehicle warranties are great – they’re generally bumper-to-bumper and cover problems without a deductible. The only problem is new vehicles cost 20% more than their identical used counterparts. So buying a brand new car with 15 miles costs 20% more than a used one with 1500 miles. It would seem like everyone should buy a used vehicle with 1500 miles, but there definitely is not enough supply to provide that. But as I’ve stated in previous articles, buying certified pre-owned is always the best bet, which usually come with a balance of the new car warranty on top of an extended warranty. You can always buy an extended warranty on a new car and most used cars, but is it worth it? The answer is in which vehicle you purchased and how much you plan to drive it. I recommend eyeing the consumer reports new or used car lists, which will show you the amount of repairs each model/make required. If you’re buying a car because you like the way it looks, but it gets a poor rating in consumer reports, buy the extended warranty. You won’t be sorry.
What Could Go Wrong?
The worst thing you could have happen is your new or used car breaks down while you’re still making payments. If you’re making $200/month payments on a car that doesn’t run, it puts you in a very difficult situation. Always carry a warranty as long as you are making payments. You never want to be caught in a situation where you’re unable to fix the car and make the payments at the same time.
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