Where to start when choosing between a new or used car
PriceStarting your research on new and used cars should really begin with your budget. Regardless of whether the vehicle you’re looking at is tucked away on a glossy showroom floor, or has been pre-loved and on your local classifieds, it needs to fit with what you can reasonably afford.
It’s no secret that a pre-owned vehicle is typically the more affordable option, and is often considerably cheaper than when you buy new. This is largely due to the depreciation that cars experience after the initial purchase.
If you’re looking at getting finance for your next car purchase, it can be hard to start searching for vehicles before you know how much your loan will cost you each week.
Check out our car loan calculator so that you can get a better understanding of how much your repayments could be if you are approved for a loan with us.
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Time spent on new cars vs used carsIf you’ve got the money sorted, but it’s time that you’re poor with, new cars do come with the advantage of generally being more available with the specific options that you want. Perhaps you want a particular make and model with leather seats, not trim — or in white, not red; the used car market is as it is, whereas new cars have the advantage of generally being able to be selected to your exact specifications. (Plus, all the latest features on top of that new car smell can be hard to resist).
Total costsLooking at how much you want to spend on a car doesn’t stop at the purchase price. When you’re trying to decide on buying a new car versus old, you’ll need to look at the total cost of the vehicle. This includes things like car insurance, services, registration, fuel costs and other charges and factors.
New Car WarrantyOne of the benefits that most new car prices cover is a manufacturer’s warranty, which can save you from paying for major repairs out of your own pocket for the first few years. Most new cars come with a minimum five-year manufacturer’s warranty, which is certainly attractive when you buy a new car.
Our top tips to buying a second-hand car or new carWhen buying any car, regardless of whether it’s a used car or new, car sales can be complicated transactions. Here are our top tips to help:
Look at all of your optionsCar dealers aren’t the only place that offer used car sales. You’ll likely be able to find certified pre-owned cars at places like an auction in your local area. Buying from a reputable dealer is a great way to make sure that you’re not being taken advantage of. However, there is a lot of value to be had in private sales as well, such as classifieds.
Keep a paper trailWhether it’s to access your full warranty on a new car or because you chose to pay cash on a used option, make sure that you keep an adequate paper trail of your purchase. This will also help if you go to on-sell your car down the track.
Use the proceeds of your existing carUnless you really need two cars and two sets of registration, you could consider selling your current car and using the proceeds to reduce the outlay towards your next car. If you’re buying through a dealership, then you might look to offer your old one as a trade-in. It’s common knowledge though, that often you can access a higher price for your vehicle by selling privately. You could also look to use the sale of your old wheels as a deposit towards your car loan! But make sure you get independent professional advice first!
Get car insurance before you drive awayObtaining a comprehensive insurance policy on your new pride and joy isn’t just sensible to protect your latest purchase, but is sometimes a requirement on some car loans.
Opt for a secured loanAvoid paying more interest than you need to on your car loan by opting for a secured car loan. We can help you understand the difference between car loan options.
Disclaimer: The information above is of a general nature only and does not consider your personal objectives, financial situation or particular needs. You should consider seeking independent advice regarding your legal, financial, taxation or other needs, to check how the information relates to your particular circumstances. We do not accept responsibility for any loss arising from the use of, or reliance on, the information. All loan applications are subject to normal lending criteria. Fees and charges payable. Terms and conditions apply.