If you are looking to purchase a vehicle, it may be in your best interest financially to purchase a used car instead of a new one. A vehicle is labeled as used after its first owner sells it or trades it to a dealer. Therefore, you may be able to get a late model car or truck for less money and with the balance of the original manufacturer warranty.
Used Vehicles Depreciate Slower
Perhaps the best reason to buy a used car or truck instead of a new one is that used vehicles depreciate less quickly. Therefore, it will be worth more when it comes time to sell or trade it back to the dealer. Depending on market conditions in your area, it may be possible to sell or trade your car for more than you acquired it for.
Used Cars Typically Cost Less to Insure
When it comes time to purchase your next car or truck, don’t forget to account for the cost of insuring it. All 50 states require that you have liability insurance, and it can also be a good idea to include collision and comprehensive coverage as well. In addition to a lower premium payment, the deductible on a used car could be lower as well. The deductible is the amount that you have to pay before your policy kicks in.
A Used Car Could Cost Less to Maintain
Before you buy a vehicle, it is a good idea to get a used car history report. This will tell you if it has been in an accidents, has a salvaged title or has been labeled as a lemon. If a car has been driven for tens of thousands of miles without incident, there is a good chance that it won’t cause any significant problems in the future. Ultimately, it means less money spent on transmission repairs and other costs.
Use Your Structured Settlement to Make Loan Payments
If you have a structured settlement, the money that you receive each month could be used to pay for a car loan. It could also be used to make a down payment, which would reduce the amount that you would need to borrow. Structured settlements may earn interest, which could negate any interest paid on a car loan.
Buying a car involves spending a significant amount of money. Therefore, you will want to get the most value for your dollar, and that usually means buying a previously owned vehicle instead of a brand new one.