New car vs used car
Updated: Wednesday, 7 September 2022
Many of us will face this question when it comes to buying a car: do we go with a brand new car or save a bit of money and get a used car?
It’s quite often a difficult question, and there are plenty of pros and cons to both. The answers are never one-size-fits-all, so we’ve compiled a list of some of the most important things to consider when weighing up your options.
What sort of repayments will I be able to afford?
This is one of the most common, and biggest, questions we will ask ourselves when purchasing a car – either new or used.
Buying a car based on how much you can afford to pay each month can often help to ensure that you don’t buy a car that is too much for your needs.
For example, it’s often tempting to buy a car just because you can afford it, but if you only need a car for your commute then you probably won’t need a car with a huge engine.
Benefits of buying a new car
When purchasing a new car, you don’t have to worry about any hidden history of the car, such as any previous faults that the car might have.
Advances in modern technology also mean that newer cars tend to be more fuel efficient, making them cheaper to run – especially important as the price of petrol continues to increase. Other features such as stability control and better airbag technology can also prove to be invaluable.
Incentives from a car dealership
Dealerships will often offer incentives to encourage you to purchase a new car, rather than a used one. These can include big financial savings, such as interest-free or low-interest financing, small deposits required, or cash rebates.
However, these financial benefits are typically only available if you have good credit – meaning that if you have bad credit you might not be able to make the most of these financial perks, leaving you to foot a more expensive bill than if you have bought a used car.
Some dealerships may even offer free maintenance and a warranty. These can help massively if something goes wrong with your car, which won’t be the case if you purchase a used car.
Benefits of buying a used car
The biggest reason to get a used car instead of a new car is usually financial. Used cars will be a lot cheaper than buying new, not just for the car itself, but you will also avoid processing, preparation and advertising fees. These can often be quite sizeable chunks of money.
By buying a used car, you will also avoid the huge cost of depreciation, which can be as much as 40% in the first year.
There also tends to be a wider choice of used cars on the market, more than are available new. Older models that are no longer in production can often be more suited to your needs, or you might prefer their aesthetics.
Bottom line
Overall, there are many things to consider when purchasing a car, and these options do not fit everyone in the same way.
If finance is more important to you, you might want to weigh up how much money you would save when purchasing a new car – especially with the finance options that are currently offered with new cars.
When it comes to purchasing that new car, remember that if you need car finance options, we can help. Apply online or, if you’d prefer to talk to us, feel free to contact us.
For a better road ahead
Moneybarn is a member of the Finance and Leasing Association, the official trade organisation of the motor finance industry. The FLA promotes best practice in the motor finance industry for lending and leasing to consumers and businesses.
Moneybarn is the trading style of Moneybarn No. 1 Limited, a company registered in England and Wales with company number 04496573, and Moneybarn Limited, a company registered in England and Wales with company number 02766324. The registered address for these companies is: Athena House, Bedford Road, Petersfield, Hampshire, GU32 3LJ.
Moneybarn’s VAT registration number is 180 5559 52.
Moneybarn Limited is authorised and regulated by the Financial Conduct Authority (Financial Services reference No. 702781)
Moneybarn No. 1 Limited is authorised and regulated by the Financial Conduct Authority (Financial Services reference No. 702780)
