This comparison can help you decide if a new or used car is best for you.
New cars vs. used cars
|New cars: Plus & minus||Used cars: Plus & minus|
|Minus: higher price
The purchase price of a car is higher when the car is new.
|Plus: lower price
Used cars have a lower purchase price and can be a much better value overall. If you purchase from a private seller with no dealer in the transaction, you’ll probably get a better price — but you’ll have little recourse if the deal turns out to be a bad one.
|Minus: instant depreciation
A new car depreciates the minute you buy it — 15% or more.
|Plus: less depreciation
Used cars depreciate more slowly than new ones.
|Minus: higher insurance, tax & fees
Insurance, taxes, and registration fees for a car are higher when the car is new
|Minus: higher loan interest rate?
A loan for a used car may carry a higher interest rate than for a new car.
New cars come with a warranty of up to 10 years or 100,000 miles.
|Minus: limited or no warranty
If you purchase from a private seller, you’ll have no warranty. A dealer may or may not offer you a warranty on a used car.
|Plus: latest features & options
With a new car you can often have the flexibility to order a car with the features and options you want.
|Plus or minus: fewer feature choices
You can’t “order” a used car with the features and options you want, and waiting for the perfect match could take months. But with a used car you may get more features for the money.
|Plus: top condition
A new car should have no previous wear, mechanical problems or body damage.
|Minus: higher maintenance
Before buying a used car:
Thoroughly review all maintenance documentation
Inspect the car during daylight hours
Test drive in highway conditions
Consult a service such as Carfax to determine if the car has been in an accident or otherwise damaged
Have a mechanic inspect the car before you pay
A good middle ground between new and used is a “certified pre-owned” car. These have been checked out by a dealer and come with a warranty.
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