Obtaining a driver’s license is a rite of passage for every teenage American. With the launch of so many new and exciting cars, we mustn’t forget that older cars continue to be maintained and driven on a regular basis as well. Before you go out to buy yourself a car, consider these factors we’ve mentioned below which will help you decide between buying a new car, getting a used one or simply leasing.
Pros & Cons of Buying a new car, a used car or leasing
Pros & Cons of Buying a New Car
- It’s a new car and it’s really hard to beat the satisfaction of driving a new car with its shiny paint, brand-new chrome, and up-to-date technology.
- A new car has the latest safety and technological features.
- New cars have relatively higher gas mileage.
- As the 1st buyer, you will bear the brunt of depreciation as your car loses almost half of its retail value in the first three years.
- In addition to liability, you must carry collision and comprehensive insurance, which are usually higher for new car owners.
- The downside of the latest tech is that it may have to be subject to various service alerts before all the glitches are identified and rectified.
Pros & Cons of Buying a Used Car
- A 3-year-old car has a retail value estimated at one-half of a new model, due to the increased decline in its market value. This means that you may pick up a used car for less than a stripped-down new car model. Trade-in your current car for a newer upgrade here.
- While rates are lower for used vehicles, you may have to elect to have higher deductibles for collision or comprehensive insurance, or let go of them completely.
- Automobile manufacturing and technology has improved to the point where modern vehicles can easily go 100,000 to 150,000 miles with regular maintenance without expensive overhaul.
- Used cars already have set colors, features, and options that are unique, unlike a new car which you can customize to your specifications.
- Used vehicles have outdated safety features.
- Used cars have lower fuel efficiency ratings than newer cars.
Pros & Cons of Leasing a Car
- With a leased car, you effectively get all of the advantages of a new car with your choice of options in a lease program. This includes any warranty or maintenance provided with a new car.
- You won’t have to worry about depreciation or market risks since you’re not typically responsible if the car’s resale value at the end of the lease is lower than originally projected.
- You won’t be responsible for sales tax, since you aren’t purchasing the car.
- Leasing a used car for the purpose of the business will help you simplify tax as the expense can be deducted pro-rata. You won’t need to calculate depreciation or maintain extensive records for taxes.
- A leasing agency usually mandates higher levels of liability coverage for its vehicle and lower deductibles for collision and comprehensive insurance.
- If you exceed mileage limits specified in the lease, you may be subject to high fees upon lease termination, usually calculated at a per-mile rate.
- Only the leasing company is allowed to determine the shape of your returned car. If they feel it is in worse shape than expected before the lease was initiated, the company may demand a penalty fee.
Still struggling between new, used or leased? Head on to the Car Factory in Miami or Hollywood, log on to CarFactory.com OR call (786) 406-6234 to get more information about the vehicle and plan that would suit you best!
Recommended Read: Tips For Buying A Car In Miami, Florida