Thursday, June 15, 2006

The Right Used Car is a Better Buy than a New Car

This probably sounds strange coming from a new car dealer, but I strongly recommend you consider making your next vehicle purchased used rather than new.

The biggest reason for this is price and value. Everybody knows that a new car can depreciate several thousands of dollars in the first few months of ownership. This depreciation is mainly due to the psychological, emotional desire to be the first owner of a new vehicle. What other explanation is there for current or one year old model used car with most of the new car warranty remaining selling for 2 or 3 thousand dollars less than a new one?

Another reason a used car can be a better buy is that it has a performance track record. More often than not, the first year of a new model comes with some minor and even major “bugs”. The buyer of a new model in its first year of introduction can find himself performing the role of a test pilot. With a used car, you can sometimes speak to the former owner, review the cars service file, research its performance on the Internet, or check out Consumer Reports. The April issue has an article entitled “Best & worst used cars”.

Of course there is more risk in buying used. Do not buy a used car without knowing its maintenance and repair history. The dealer should allow you to take the car to your own mechanic to thoroughly check out the car. Ask for the right to drive the car for at least a day or two to evaluate its performance under different driving conditions. The dealer should provide you with a Carfax vehicle history report which will tell you if the vehicle has previously been in an accident, flood, and if the mileage is accurate. Most car dealers have a paint meter that they can run over the paint surface which tells if it has ever been repainted. A new car dealer will run the VIN to let you know if there are recall campaigns outstanding on this model.

Do not take it on faith that the price is right just because you are buying a used car. Research the price just as you would for a new car. This is especially true when buying a current model used car. Sometimes manufacturers’ rebates and incentives on new cars can bring the price down close to that of same year used. You can ask the dealer to show you the appraisal sheet which shows the wholesale value when he traded the car in. He also had to spend money on reconditioning and you should ask him about this too.
Use your Internet sources like Edmunds.com, Kbb.com, and Consumer Reports.

Perhaps the most important thing you can do to insure you don’t “get stuck with somebody else’s problems” is to buy from someone you can trust. If you can’t find such a car dealer or individual, insist that everything you discussed and all promises and assurances be put in writing.

1 comment:

  1. Earl, just wanted to thank you for your articles. Considering your position, your blog is a good resource for car buyers. I'm looking to buy a certified used Acura in August, so I'm doing some research. I got screwed when I bought my current Acura from a used car dealer last year.

    I came here from Consumerist.com, so you may get some more traffic soon. Thanks again, and I look forward to future posts.

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