Car Buying: New vs. Used

Thinking about buying a car for the first time? Or maybe it’s just time for an upgrade? People looking for a good deal might consider a used car purchase before spending any extra money on a new car.  But before you go car shopping, think about this: it may actually cost less per month to buy brand new versus used.

Why? The change in interest rates is the main reason. Taking a loan out on a vehicle will have you paying far above the sticker price.  The twist here is that rates are falling quickly on new cars; from a third of a percent since November, and half a percent from a year ago, putting them at 4.16 percent today.

If you’re in the market for a luxury car, then you’re in even more luck because rates have fallen to only 2.9 percent. There is even a chance that you may not have to pay any interest at all. Toyota, for example, offers zero percent financing on more than half of its models.

Even the gap in sticker prices between new and used cars is closing.  Manufacturers are looking for ways to get people to buy new cars, and they’re doing it by offering some of the best deals ever.

Bottom line, before you decide to purchase a used car that seems cheap, compare interest rates to find out if it really is the best choice.  What you see on the window isn’t always what you’ll be paying after years of interest rates.


1 Comment

  1. Very interesting post, I really enjoyed reading it – thank you for the information.

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