Pros and Cons of Buying A New Car | 9 Key Facts To Evaluate
New vehicles are exciting. They’re flashy, they have all of the latest features, and they often come with that fresh smell. There is more excitement and pleasure involved when you’re the first owner of a vehicle than when you’re the second or third.
However, with that pleasure of buying a new car also comes a hefty price tag. New cars are expensive – there’s no getting around it. In addition to the actual cost of the vehicle, there are also taxes and fees, as well as the cost of insurance and gas.
If you’re considering getting a car, it’s important to weigh the pros and cons of buying a new car carefully before making your decision. We have prepared a list of some of the advantages and disadvantages of doing so to help you out.
Pros of Buying a Brand New Car
There are many positives to purchasing a new car. One of the main advantages is that you are the first person to drive the vehicle, so you don’t have to worry about it being used or abused by someone else before you get it.
You won’t have to do much due diligence since the car is new from the factory, which can save you a lot of time. In addition, all of the advanced safety features and amenities in the car will be up-to-date. Here are some of the pros of buying a new car:
During your car purchase, you will have to decide if you want to buy the vehicle with cash or finance it. If you do decide to finance your vehicle, the interest rates are usually lower for new cars than used ones.
When lenders see a new vehicle being purchased, they perceive it as less risky than if someone was buying a used car. Therefore, the borrower is rewarded with a lower interest rate. The Federal Reserve has maintained a near-zero percent loan interest rate for years now, so this is an opportune time to buy a new car.
However, it is important to note that you should only finance a vehicle if you can afford the monthly payments. Just because the interest rate is low doesn’t mean that you can necessarily afford the car.
Speak with your financial advisor to evaluate what is the best option for you. There are plenty of auto loan companies that offer different financing options to help make your car purchase more affordable.
One of the benefits of buying a new vehicle is that it likely comes with a warranty from the manufacturer. So if anything goes wrong with your car within a certain period of time, you will not have to pay for the repairs.
The length of time and coverage of the warranty will vary depending on the manufacturer’s warranty specifications. Nevertheless, it’s important to have some sort of coverage in case something does go wrong with your new car.
You always have the option to purchase an extended warranty, which will cover your car beyond the manufacturer’s expiration date. This can give you some peace of mind and protection in case something happens to your new car.
New Car Smell
The smell of a new car compared to a used vehicle is incomparable. When you first get into a new car, there’s that new car smell that just fills the entire vehicle. This is often one of the reasons people love buying new cars.
The smell of a new car can be addicting and make you feel good every time you get into your vehicle. The whole car buying experience can be quite enjoyable, from the smell to the feel of the new car.
As mentioned earlier, new cars come with all of the latest features and technology. This includes things like:
- Hands-free Bluetooth
- Satellite radio
- Backup cameras
- Blind-spot monitoring
- Stability control
- Lane departure warnings
- Adaptive cruise control
Expensive cars will also have features like heated and cooled seats, self-parking, and even autonomous driving features. Once you decide on which model your want, you can customize it according to your personal preferences.
Higher Fuel efficiency
New vehicles are getting more fuel-efficient every year as technology improves. If you’re looking to save some money on gas, buying a new car is a good option.
Older cars simply can’t compare to the fuel efficiency of newer vehicles. If you do a lot of driving, you will notice a significant difference in the amount of money you spend on gas each month.
You will also need fewer oil changes with a new car since the type of oil used has improved greatly over the years. You will save money on maintenance costs in the long run. This translates into an overall lower cost of ownership.
Cons of Buying a Brand New Car
Most vehicles that are new to the market will have a higher price tag. You may be able to find some deals on new cars, but generally speaking, they will be more expensive than used cars.
It’s also worth noting that new cars depreciate quite quickly. As soon as you drive your dream car off the lot, it can depreciate by 20% or more.
Insurance rates whenever you buy a new car will be higher than if you were to buy a used vehicle. This is because newer cars are more expensive to replace if they are totaled in an accident.
If you live in an urban area with a high crime rate, your insurance rates will be higher than those in a rural area. This is something to keep in mind when deciding whether or not to buy a new car.
When you finance your new vehicle, you might be required to get full coverage insurance, which is more expensive than liability insurance. Be sure to check with your lender to see what type of insurance they require.
When you buy a new car, you will also have to pay for things like taxes and registration fees. These can add up to the total value quickly and cost you quite a bit of cash.
Here is where your personal preference comes into play. If you enjoy the process of buying a new car and don’t mind paying a bit more for it, then go ahead and buy one.
However, if you’re looking to pocket some cash, buying a used car is the way to go. You can find used cars that have been well taken care of and have only been used for a few years. This way, you can get all of the features of a new car without having to pay as much for the initial investment.
Auto loans can be a great way to finance your new car, but they typically last for five years. You will be committing to making monthly payments on your car for the next five years or so.
While the interest rates are usually lower for new vehicles, the length of the loan means that you will end up paying more in interest over time. Sometimes you can even get a 0% financing during the promotional periods.
Getting into these types of deals will help you save more cash, and you could also potentially get a lower price on your car than the original value. Just be sure that you can afford the monthly payments before signing up for a loan.
Buying a new car is a great way to get all of the latest features, but it also has some disadvantages. One of the biggest downsides is that new vehicles depreciate quickly.
As soon as you drive your new car off the lot, it can lose 20% or more of its value. This means that if you decide to sell it or trade it in a few years, you will likely get much less money than you paid for it.
With a used vehicle, you won’t have as much room for depreciation because the original owner will have already taken the brunt of it. After the first year of use, a new car can depreciate by up to 40%.
Should you buy a new or used car?
There is always the doubt about whether you should get a new or used car. It depends on each person’s needs. Used vehicles might have more wear and tear, but they will be cheaper.
The best way to decide is by looking at your needs and comparing what is more convenient for you in the long run. Before signing on the dotted line, figure out if buying a new vehicle is the right move for you.
When buying a used car, you can run into other maintenance issues such as electrical problems, engine trouble, or even transmission issues. Another of the advantages of buying new is that you won’t even need to get vehicle history reports.
The warranty coverage typically includes roadside assistance, which can come in handy if you have a flat tire or run out of gas. Some new vehicles also come with free maintenance for the first year or two, saving you a lot.
Be aware of the pros and cons of car buying so you can make the best decision for your needs. If you want a new car, be prepared to pay more upfront.
Buying a used Volkswagen in London sometimes is more convenient because you will get more value for what you are paying, but you might have to deal with more repairs down the road.
Last Updated on: June 22, 2022