Make the right decision and drive away without regret.
New vs. used cars in a nutshell
|New Car||Used Car|
|Price||Generally costs more and depreciates immediately||Generally costs less and retains its value longer|
|Car options||Lots of options that you can customize to your needs||You’ll face a limited selection depending on your location|
|What you need to know||Know how to avoid expensive sales tactics||Know what to look for in a used car and how to avoid a lemon|
|Financing options||More options with lower interest rates||Fewer options with higher interest rates and more stringent requirements|
|Information available||Manufacturer stickers, dealer documentation and up-to-date reports||Typically general information only, and private sales may have none|
|Warranty||Manufacturer and dealer warranties are available||Varies depending on the age and condition of a car|
Compare your financing options for new and used cars
What factors should I consider?
Financing options for new and used cars
Financing a new car
It’s likely that if you have decent credit and are looking to buy a new car, you’ll be given a lower interest rate than someone looking to finance a used car.
Since you’re still paying a premium for a new car, you may need to borrow more. This means that whatever you’re saving on interest could be negated by the higher price tag on your new car.
Financing a used car
A used car may have a higher interest rate, but you’ll likely be paying significantly less than you would for a new car. The downside? Some lenders only finance a used cars under a specific amount of miles or under a certain age.
Secured vs. unsecured loans
If you aren’t interested in using your car as collateral, there are still other ways to finance your vehicle. You may want to consider an unsecured car loan.
Used cars are considerably cheaper, but you’re not getting the first-owner benefits that come with a new car. Take your finances into account, and be sure to take your time making this decision. After all, whichever you choose, it will likely be with you for at least a few years.
Frequently asked questions
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