Pre-Owned Cars
Pre-owned cars offer some of the best values to be found.
That is especially true in 2022 and beyond – the world-wide pandemic has turned the pre-owned vehicle market upside down just like everything else.
But still, used or pre-owned vehicles are a great value and in many respects are better than buying new.
The Many Benefits Of Pre-Owned Cars
For starters, depreciation is less of a concern.
It’s true that as soon as you drive a new vehicle of the lot it begins to lose value.
Worse still is that over the first 12 months, the average new car will lose UP TO 20% of its worth!
And it doesn’t stop there:
It will continue to lose value for the next several years until after about the fifth year.
By year five, most vehicles will have lost between 35% and 40% of their value!
This info will prepare you to find the bargains and CLOSE THE DEALS::
Pre-owned Cars For Business Or For Pleasure?
Now another factor to consider is this:
Are you buying a vehicle for personal use or business use?
If it’s a new ride for your personal use, that annual depreciation is just value lost.
But if it’s for business use – you can very likely claim some of the depreciation as a tax loss. That’s advantageous in minimizing the lost value.
Also, later own when your business sells that vehicle, you will recoup more of your original investment.
OK – so we see that buying a used car comes with many benefits for the average car buyer.
But it’s still a big investment and buying a pre-owned vehicle does carry some risk.
Many years ago, my father told me to never buy a used car – “you’re buying someone else’s mistake”, he would say. The logic was that whoever got rid of the vehicle did so for a reason. It was a “lemon” or maybe it was unreliable or needed frequent repairs.
But Are You Buying “A Mistake”?
Back in that day there was a lot of truth to that, but that was back when used cars were exactly that.
They were “used” and you never knew how hard they had been used or how well they had been maintained along the way to the used car lot.
These days of course, all of that has changed, largely due to the popularity and demand for clean, reliable, well-maintained pre-owned cars and flexible, almost instant credit options.
Now, selling used cars can be just as profitable for a dealer as selling a new one. Additionally, the demand is strong and the re-sale values are too. Consequently, selling a used car is certainly more profitable than not selling any car.
For that reason, we now have “pre-owned” and even “certified pre-owned” vehicles.
We also have services that track the ownership and service records of vehicles from the first moment that are purchased new and driven off the lot.
Why Dealers Like Pre-owned Cars
Dealerships take vehicles in trade – and they re-market leased vehicles.
They have a vested interest in making sure that any problems have been fixed and that the vehicle is trouble free. Usually, they offer a limited warranty so they don’t want the buyer to have problems.
Warranties & Pre Owned Cars – Buyer Protection
For pre-owned buyers who want an extra measure of assurance, many companies offer extended warranties. Some even cover used vehicles from bumper to bumper for a set period of time.
But don’t just rush out and buy a pre-owned car without doing your due diligence!
There are certain things you need to consider before buying a used vehicle just like before buying a new one.
Making The Right Call
Here are a few tips that will help you make a great deal and ensure that you are well satisfied:
- How much can you afford?
A good rule of thumb is that they payments should be no more than 10% of your take-home pay. Obviously, your personal circumstances will affect that rule. Keep in mind that even a top=notch used car may need a little TLC sooner than a new one – new tires, new belts or hoses, etc. It’s a good idea to have a little cash in reserve to cover expenses not covered under your warranty.
spacer - Once you’ve settled on a price range, start building a list of vehicles that suit your need and fall into your price range. There are a lot of different ways to do this. And don’t forget to keep your eye and ears peeled for super-aggressive deals – like repossessed vehicles from banks, credit unions or public auctions.
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Cost Versus Value
placeholder - Shop prices.
Seriously – shop prices aggressively.
Start with your local dealers – it’s always best to buy locally when all things are equal. However, be prepared to use the internet and services like CarMax to your full advantage. Sometimes even if you really have your eye on something local, presenting that dealer with super-aggressive deals from elsewhere can motivate them to work a little harder to win your business. Like we said before – selling a used car is better than NOT SELLING A CAR at all!
line break - When you find a great car at a great price – CHECK THE VEHICLE HISTORY!
This is one of the modern advantages that cancel out my father’s advice to “never buy someone else’s mistake”. These days, in a matter of hours, and for a very reasonable price; we can use services like Carfax and AutoCheck to get a vehicle history report. Many dealerships offer these services at no additional cost, be sure to ask about it before incurring the expense.
new line - Test drive the vehicle if it’s local.
If it’s not local, be sure to test drive the same make and model vehicle before getting too far into the negotiations and driving the used vehicle itself. Make sure that it’s comfortable. I should have enough space for your needs. Make sure that the AC and accessories work well. All of those little (or large) things come together to make the vehicle a good fit for you personally.
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Add An Extra Measure Of Caution
You may even want a trusted mechanic to give it a thorough inspection before you seal the deal.
So even though a pre-owned vehicle can still be a major investment, there are many reasons besides price alone that can make it a wise choice.
And the key is to find a wide selection of clean and dependable vehicles with clear titles, that will give you plenty to choose from at a variety of price points.
You really owe it to yourself to check this out – it covers all the needs and concerns of investing in preowned cars with confidence!
