Purchasing a car not only means deciding which model you want, but also if you’re going to buy a used vehicle or a swanking new car. Deciding this is crucial as purchasing a used or new vehicle will have a considerable effect on your finances over the next few years.
Therefore, to help you decide between new car vs used car purchase, we have highlighted some advantages of each type.
Pros of Buying a Used Car
- If you want to buy a second-hand car, that too by taking aloan for used cars, you will get it for far less than what you would have to pay for a brand-new vehicle. This becomes especially beneficial if you want to buy a luxury car, as you will get it at a much lower market price.
- Used cars depreciate at a considerably slower rate than a new car. Buying a used car means that you are buying it at a price which has already suffered maximum depreciation and will not lose much value in the coming years. This becomes helpful when you plan on reselling your car as it retains most of its original value.
- The insurance premium on your used vehiclewill be lower than a new car. Remember that insurance premiums are calculated based on the market value of the vehicle. Since the value of the second-hand vehicle will already have depreciated over the years, you will be paying a lower premium as opposed to a new car.
Pros of Buying a New Car
- As it is a brand-new car, it will have good reliability records. You don’t have to worry about the car’s history or whether it is mechanically sound.
- Mostly new vehicles will only require a few repairs in the first few years. This means far fewer trips to the garage.
- A brand-new car, most importantly, will be up-to-date and will boast the latest tech in terms of gadgets, accessories, and equipment. This also means that you will get a car with better mileage, lower emissions and latest safety features.
After reading this, if buying a used vehicle with a second-hand car loan is not your cup of tea, then pick a new car.
New Car vs Used Car: Making the Decision
In cities, where congested roads are the norm, you can drive without the stress of scratching or denting a used vehicle, unlike a new car. Moreover, if you’ve moved to a new city and plan to stay there for a brief period, buying a used vehicle with a loan on used car is smart. If you want to buy used cars, various financial lenders extend loan on used car at attractive ROIs. Opting for a used car loan ensures a value-for-money purchase.
However, before applying for a used car loan, always compare the used car loan rates of interest offered by the different lenders so that you can choose the one that best suits your budget. With a loan, you can purchase a variety of used cars on EMI, including luxury cars.
Pro Tip: Before you buy used cars on EMI, calculate your monthly instalments with the help of a used loan calculator.
Buying a vehicle is a milestone decision! Hence, you should be aware of all the financial implications that follow whether you decide to buy used car or a new car.