Purchasing used autos may save money because a brand new car experiences its biggest loss in value inside the initial 12 – 18 months. Instead of witnessing the value significantly decrease in only the first year, why not purchase a used car that has low mileage?
New Vehicle Sales Depreciation
Considering purchasing a new car? Reconsider. According to the pros at Kelley Blue Book, in 3 years a new car will depreciate by as much as 73% of its value. At best it’ll retain just 62% of its value after 3 years. That is one of the best reasons you should purchase used autos.
Vehicle depreciation is the cloud that hangs over new buys. While many cars depreciate by 15% – 20% of their value every year, the first year usually hurts the most. As a matter of fact, the 2-minute drive off of the lot may cost a few owners up to 15% of their new car’s value.
If you are a vehicle buyer who isn’t willing to toss away money on car depreciation for that new vehicle smell, think about purchasing a late model, high quality used vehicle. Besides a lower purchasing price, lower license and registration fees, you will additionally enjoy lower depreciation, as the former owner already has absorbed the steepest part of the used car’s depreciation cost.
Make the Decision
Everyone needs to determine for themselves what their best option is. No matter what’s decided you either should pay cash or be certain you’re able to afford the automobile. One great rule of thumb is that you ought to have the ability to pay off the car completely in a 3 year time span. If you can’t afford the payments for this rate, you more than likely can’t afford the auto. You also should conduct your research and be certain that the model selected is reliable and has good reviews. If you don’t know anything about cars, you should get a mechanic to check the car for you, especially if it’s used. Be certain to shop around for the top loan on the vehicle if you’re borrowing money to buy the vehicle.