Pros and Cons of Buying a Used Car

Aside from purchasing a house, buying your car is one of the biggest financial decisions you’ll make in your lifetime. Andcar-buyingbark on the car buying journey, one of the most important questions you’ll face is whether to go new or used.

There’s something to be said about buying new and getting exactly what you want, a full manufacturer’s warranty, and zero wear and tear; the problem is that new cars are always much more expensive than used. But that’s just one piece of the puzzle. In this article, we’re also going to cover:

• Pros and Cons of Buying a Used Car
• Should You Consider Getting a Certified Pre-Owned Car?
• Financing Options for Used Cars

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Should You Buy a Used Car?

So, is Used the way to go? Here are some helpful insights about the pros and cons of buying a used car we’ve put together to help you weigh your options. If you have questions about financing, please don’t hesitate to give the car loan experts at People’s a call – or stop by one of our branches!

Advantages and Disadvantages of Buying a Used Car

The initial cost savings are the biggest advantage of buying a used car over a new one, but it’s not the only thing to think about. Here are other aspects to consider:

Pros of Buying a Used Car

• Cost savings: Used cars are typically at least 30-40% cheaper than new. Even if the used car is only a few years old, it will cost substantially less.
• They’ve already taken a huge amount of depreciation: Have you ever heard that expression – your car loses thousands of dollars in value the moment you drive it off the lot? This is only true of new cars.
• Faster payoff: The sooner you pay off your car, the sooner you can stop worrying about monthly payments.
• Generally cheaper to insure: Insurance premiums are based on a car’s value. Since used cars are less valuable than new ones, your insurance payments will be less, too.

Cons of Buying a Used Car

• A lot of unknowns: Nowadays, with services like Carfax, you can get a much more accurate picture of the history of the car you’re buying than you used to. But remember, you still don’t know everything.
• More wear and tear: For example, even if a used car has never been in an accident, you still don’t know how the previous owner drove it. You can end up with a roughly treated used car that requires more frequent maintenance or repairs.
• Fewer customization options: There’s no opportunity to customize or request certain features. Used cars come “as is.”
• Most don’t come with warranties: Manufacturer’s warranties often cover a certain mileage or only the first owner. When you buy used, that warranty might not cover you.

What Is a Certified Pre-Owned Car?

“Certified pre-owned? Isn’t that just a synonym for ‘used’?” In a sense, yes, but you can think of certified pre-owned (CPO) cars like a middle ground between new and used. They’re low-mileage used cars sold by dealerships after they’ve been thoroughly inspected and reconditioned by licensed mechanics. 

Should You Consider a Certified Pre-Owned Car?

If you’re the kind of person who wants the new car smell without the new car price tag, buying a CPO is a good compromise. Here are some benefits to buying Certified pre-owned cars:

• More affordable than brand-new cars
• Certified and thoroughly inspected by trained mechanics
• Most come with manufacturer warranties and benefits, such as roadside assistance
• They’ve already taken a huge amount of depreciation
• Free vehicle history reports

With CPOs, you can trust they’re in good operating condition. Figure out your budget here with our car affordability calculator.

Financing a Used Car Purchase

Some dealerships do offer financing for used cars, but some don’t. And not all used car sales are through dealerships. Many used car sales are private, which means you need to have your financing lined up separately.

Is It Easy to Get Financing for a Used Car?

Yes. Fortunately, it’s almost as easy to get financing for a used car directly through your bank or credit union. You just have to do it beforehand by getting preapproval. The advantages of financing your used car through a credit union like People’s Community Federal Credit Union include:

• Direct lending through a credit union often provides the most competitive rates and flexible terms. 
• You’ll get pre-approved before you shop, which gives you negotiating power at the dealership and helps you stay within your budget.
• When you finance with People’s, you’re always getting our best rate because all of our members get the same great rates when they qualify, regardless of credit score. See our current rates here.
• Our experienced auto loan experts are here to help you navigate these decisions with confidence. Unlike the dealer, we’re not trying to sell you anything.

Used Car Financing Made Easy at People’s

Deciding whether to buy a used car or a new car is a serious financial decision. Before you buy, carefully look over terms, compare monthly payments, and shop around for auto rates. Also remember, you can always negotiate your payments and terms with the dealership, whether you’re buying used or new. 

When you’re ready to finance, consider People’s Community Federal Credit Union. We offer a variety of loan types and 100% financing for qualified members. Best of all, our loan rates are the same for all members of PCCU!

Reach out to one of our team members by giving us a call or visiting one of our branch locations.

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