If you’re looking to buy a car, you have two basic options: new or used. Each option has its own pros and cons.
Buying a New Car: the Pros
· A new car won’t have any engine, interior or body damage (or wear and tear). A used car will, at least to some extent.
· You’ll have a larger range of newer models to choose from than you will if you buy a used car.
· You’ll get a manufacturer’s and dealer’s warranties.
· There’s no need to arrange a professional inspection before you buy like you should when you buy a used car.
· New cars come with valid ANCAP safety ratings. These ratings are not valid for used cars.
Buying a New Car: the Cons
· Depending on the model, buying a new car is usually a lot more expensive than buying a used car. It’s important to understand how to negotiate with a car dealer to avoid paying too much.
· If you’re buying from a dealer, you need to be aware of their sales tactics. Those tactics could lead you to paying for expensive add-ons.
· The manufacturer’s and dealer’s warranties may be expensive. They may also include strict servicing conditions. Those conditions may restrict you to servicing your car at expensive authorised dealers.
· A new car loses value almost as soon as you drive it out of a dealer’s yard. It will also usually continue to lose value at a faster rate than a used car.
Buying a Used Car: the Pros
· Buying a used car is usually a lot cheaper than buying a new car (depending on the model).
· If you buy a used car privately rather than through a dealer, it will be even cheaper again. Dealers have to add a profit margin into any sale, private sellers don’t.
Buying a Used Car: the Cons
· A used car will have varying degrees of wear and tear on its engine, interior and body, a new car won’t. It may also have damage in any of these areas.
· You’ll have a more limited range of newer models to choose from.
· If you’re buying a used car from a dealer, again be wary of sales tactics to tempt you to buy expensive add-ons.
· It can be time-consuming to research the market and find a good used car.
· Unless you know a lot about cars, you should arrange a professional inspection before you buy. This isn’t necessary when buying a new car.
· ANCAP safety ratings are not valid for used cars.
· You may not get a clear idea of the vehicle’s driving and service history when buying a used car.
· Money can be owing on a used car. You need to check this before you buy. You can do this by searching the Personal Properties Securities Register.
How we can help
Whether you’re looking to buy a new or used car, talk to us to arrange your finance. We’re car finance brokers and we can get you the best deal. Don’t use dealer-arranged finance or try and arrange a loan yourself.
We can also arrange mechanical warranties for the private sale of used cars. These warranties reduce your buying risk. You can be confident that you’ll be protected from getting a lemon.
Call 1300 301 051 during business hours to speak with one of our experienced finance brokers.