When considering whether to buy a new or used car, there are financial and practical benefits no matter which route you take. Since a car may be the second largest asset you ever buy, it's worth examining the benefits of both.
Either way, you will want a vehicle that holds its value, is reliable and fuel efficient, and gets high marks from industry experts. An online search can provide information on makes and models, safety ratings, prices, professional and personal reviews and more.
Benefits of new cars
Interest rates on new car loans may be several percentage points lower than on a used car loan. See our auto loan rates. Long-term warranties from auto makers on new cars bring peace of mind. You likely won't pay for most repairs on your car for several years.
In many cases, the latest safety features and technology enhancements – such as blind spot monitoring, brake assist and rearview cameras – are readily available in new cars. Factory rebates and dealer incentives can reduce the cost of new vehicles significantly.
A hybrid or alternative-fuel vehicle can help you take advantage of tax credits or other incentives. Consult your tax advisor for more information.
Benefits of used cars
Used cars generally cost less. Cars lose value, or depreciate, quickly, which means you benefit from a lower price if you buy used. There may still be warranty remaining on the used vehicle covering certain repairs for several months after you buy.
Dealer preparation fees are lower on used cars than new ones. Consider buying from a private seller to avoid those types of fees altogether. Your auto insurance premiums may be lower with a used car, depending on coverage choices and other factors.
Weigh your transportation needs with the benefits of both new and used cars. Then contact us for more information about our auto loans. We can help you with a loan that's right for you.