How to Buy a Used Car
Advantages and Disadvantages of Used Cars
In 1996, very nearly two out of every three cars sold were used cars. Many consumers, especially teenagers, cannot afford to buy a new car when the average price is approximately $18,000. The cost of insurance is much higher for a new car, increasing the demand for used cars. The supply of used cars has increased due to the number of two and three-year-old lease cars available.
There are real advantages to buying a used car. The buyer of a used car avoids some of the depreciation costs, which can be up to 40% of its value in the first two years. Sometimes, buyers can afford more options and luxury items when they purchase a used car. Many consumers feel that they can arrange a better deal with less hassle if they buy directly from the owner of the car.
Buying a used car can have disadvantages as well. One important disadvantage is that often the most maintenance-free time of the cars life is during the first two years. Some used cars have serious hidden defects with limited or no warranty coverage. It is sometimes difficult to determine whether the car was maintained properly by its previous owner. The used car may not have all the desirable safety or technical features of a new car. The selection of models, equipment, and colors may be limited.