Should You Buy New or Used? Advantages, Disadvantages to Both Options
When you are looking to buy a car, you have a couple of options. You can buy either a new or used car or you can lease a new car. There are advantages and disadvantages to any of these choices.
There are plenty of advantages to getting a new vehicle, whether you buy or lease. With a new vehicle you are less likely to have problems that will cost you money to fix, and even if you do have problems, the car will be covered by a warranty for at least the first three years or so. Another advantage to getting a new car is that you will get the newest safety and entertainment features, such as remote start, keyless entry, in-car wifi and automatic braking systems.
Of course, a big drawback to buying a new car is the price. Most new cars and trucks these days, except for compact cars, cost $30,000 or more. And if you want a luxury brand such as Audi or BMW, you are going to pay considerably more. That puts a new car out of reach financially for many people, or it requires them to get six- or seven-year loans to afford payments, which means they are still paying on the vehicle long after the warranty has expired and after the car has lost considerable value. Leasing can be a solution to that, because it is much cheaper, in terms of monthly payment, to lease a new car than to own it. However, leasing has its own drawbacks. You are limited on mileage, usually 10,000-12,000 a year, which can be a real problem if you drive a lot. Leases also are short term, anywhere from 24 to 48 months, so once the lease is up, you have to either decide to buy the car or turn it back in and find another car.
The expense of new cars and the drawbacks of leasing are why many people turn to used cars. In the U.S., about 75% of all car transactions are used car sales, and cars usually have at least three owners before seeing the scrap heap. One of the big advantages of buying a used car is that they are cheaper and you can get more features for the same amount of money. A used Audi, for instance, may be cheaper than a new Kia. You also may be able to get features in a used car, such as leather seats and a sunroof, that you wouldn’t be able to afford in a new car. There are drawbacks to used cars as well, however. For example, most are not under warranty, which means you are on the hook for any problems that crop up. You also can be at the mercy of unscrupulous dealers who may lie about the condition of a car or do something like roll back the actual miles, a practice that costs used car buyers about $4 billion a year.
If you want to afford an Audi, used may be the way to go, but you have to take into account all the pros and cons that go with buying used or buying or leasing a new car.