When you’re looking at buying a used car, you’ve got a number of options available to you – including purchasing from a private seller, an individual or from a used car dealer. However, no matter where you are purchasing your used car from, it’s useful to have knowledge of both sides of the coin before you come to any final decision.
So, what are some of the advantages and disadvantages of buying a used car? We take a look at some of the upsides to buying this way, as well as some of the issues you need to consider.
Pros of buying a used car
Cheaper than buying new
One of the main advantages of buying a used car over a new model is that you’ll be able to get your hands on some great discounts. Depending on the age of your chosen vehicle, it will likely have depreciated considerably in value meaning you’ll be able to snap it up for much less than the list price.
There are great savings to be made here – in some cases, you can save up to 50 per cent of the car’s original price. Of course, if your budget is limited then this might not be much use to you but it should certainly help you get more bang for your buck when looking at new cars for sale.
Another major advantage to buying a used car rather than a new one is that your car will depreciate much slower than if it was brand new.
This means that if you buy your used car after the first couple of years, then it won’t be subject to the same percentage of depreciation each year as say if it hadn’t been sold before. Therefore, even though there will still be some loss in value over time, you shouldn’t see as much fluctuation.
Cons of buying a used car
Lower resale value
One of the main disadvantages to buying a used car (aside from the fact that you won’t own as much car for your money) is that you’re going to see your car’s resale value diminish considerably. If you’re not planning on keeping your vehicle for more than just a few years then it might not matter too much, but if you are hoping to pass it on one day then this could be a major disadvantage.
Issues with financing
While it’s possible to get car finance for your used car, there have been cases of dealerships refusing to honour the finance agreement because the vehicle was deemed as being ‘used’. You need to check whether or not your purchase will affect your ability to finance – even if you buy privately.
If you do choose to finance your used car with a loan, bear in mind that you might end up paying a higher interest rate. For this reason, it’s really important to shop around and ensure that you’re getting the best rate possible. You can do so by comparing online car options. Don’t forget to check if there are deals specific to your city or town – you can search ‘Driva Melbourne car finance‘ to find out.
Insurance premiums might be higher
Because used cars are often more likely to have been in accidents than new vehicles, it’s possible that they will carry a high risk. This might lead to insurance companies charging you more for coverage on these vehicles which again could mean having to pay more for your car insurance.
Aside from your home, your car is likely the most expensive purchase you will make in your lifetime. It’s certainly not a decision to be taken lightly especially if a second hand car is your decision. Buying a used car can be a frightening exercise, but these simple tips from EasyCompare will help you find the right car without being ripped off.