When you buy a new car and drive it off the lot and pass the men’s barber shop at the corner the price immediately depreciates. However, when you buy a used car bulk of this kind of depreciation already occurred. This means the margin of depreciation for a person who buys a used car is less than that of someone who buys a new car.
In addition to that, you can get a really good second hand vehicle for almost the price of a new version. For example you can get a 2007 Porsche for the price of a 2011 Honda. The price you get for the Porsche may be even half the showroom price for the vehicle.
No exaggerated fees
When purchasing a new vehicle, you may think you are getting a great deal because of the given price. However, most of these include hidden charges such as advertising fees, shipping charges, destination fees and dealer preparation fees. In some places, the annual registration fee for vehicles is based of the value of the car and year of manufacture. It would mean major savings for someone who buys a car which is older by 3 or better yet 5 years or more because the rates are much lower.
Used cars are certified
Used cars that are certified ensure the buyer that they are getting a bargain of something of quality and that’s thoroughly been inspected. These cars were inspected, refurbished and certified. This is done by certifying authorities or better yet, by the manufacturer leading to assurance on the vehicle’s quality. In addition to this, they often have extended warranties, special financing among other benefits. The only assurance for the new vehicles is just the fact that they are new.
Lower insurance premiums
Insurance companies will only pay you the value of your new car at the time of the accident in case of an accident. This leaves a gap between the worth of the vehicle and the purchase price. Insurance companies have something called Gap Insurance that caters for this. This covers the difference between what was paid for the new vehicle and its depreciated value. However, this raises the insurance premium on the vehicle. For a used car, depreciation already occurred and this means there is no need for Gap Insurance and therefore lower insurance premiums.
Wider variety to choose from
When you are open to the option of buying a used car, the range of vehicles to choose from becomes limitless. This is because you are not confined to buying models that were released in the past few years. The variety means you can go for a 2005 Jeep Wrangler if that is the car you always wanted to own. When looking for a specific older model you may not always find it in new condition but it can be refurbished and modified for a lesser price than that of a new model vehicle.
When you look beyond the sale price of a vehicle and considering what you will be getting for your money, you will find the long term cost of getting a used car is much better.