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Financing: Banks offer lower financing rates for new vehicles because the vehicles are inherently worth more and are not yet affected by depreciation. Keep in mind that if the lower APR still applies to a larger sum, your payments or total cost may still be higher. Insurance rates: As with financing, insurance rates are affected by the age of a car, but in this case, the used vehicle tends to be cheaper. A little research before buying will save you from the crash of insurance stickers, no matter which vehicle you choose. Choosing a used car instead of a new one can save you a lot of money in several ways.
These built-in cost savings should be taken into account, where appropriate, in the final price analysis. To do this, check the dealer’s stock levels for the CPO vehicle you are looking for. Each dealership uses its own jargon when it comes to second-hand options, so explore it online before heading to the showroom.
There are also more hybrid options that can reduce the amount you spend on transportation each month. In addition, the improved technology can make it easier to connect your smartphone, listen to music or find your way around with GPS. Depending on the model, your insurance rates may be lower for a used car than for a new one. One reason for this is that it doesn’t cost as much to replace an older model as it does to replace a new one. Although you won’t find interest-free loans for used cars, you can still find good financing options through your local bank or credit union.
And most cars will lose another 10 percent in value in the first year. That’s a 30 percent drop in value in the first year of ownership. Bankrate.com is an independent publisher with advertising support and comparison service. We will be compensated in return for placing sponsored products and services or for clicking on certain links on our website. Therefore, this remuneration may affect how, where and in what order products appear within the offer categories.
In 2018, a Chevrolet Tahoe LT with all-wheel drive sold for around $56,500. A 2017 Tahoe purchased as a CPO vehicle could be found for around $51,500. It looks the same; it drives the same; It might even smell the same, but it costs almost $5000 less. A Honda Civic is a great entry-level car, and Used Ford Truck Dealership the same theory of the one-year-old model and the same generation works in your case as well. In 2018, a new Civic EX version had excellent value at an average transaction price of about $23,500. In contrast, a 2017 EX used with the same equipment could be found at a retail cost of $21,500.
A list of advantages and disadvantages that describes the advantages of choosing one of the routes. Bankrate was founded in 1976 and has a long history of helping people make smart financial decisions. We have maintained this reputation for more than four decades by demystifying the financial decision-making process and giving people confidence in the next steps. Although we adhere to strict editorial integrity, this publication may contain references to products of our partners. If you’re buying a used car, you may want to set aside a little money each month to cover any car repairs.
We maintain a firewall between our advertisers and our editorial staff. Our editorial team does not receive any direct remuneration from our advertisers. Vehicle marketing, inventory, sales and the car purchase transaction are carried out, hosted, managed and/or coordinated by Vroom. Depreciation is an inevitable reality of driving, but a used vehicle offers much less depreciation than a new vehicle. New cars usually lose about 20 percent of their value when they are thrown out of the lot.