New or Used? I have a lot of people that are in the market for another vehicle, but what is the best way to go with this? The answer changes with what your situation is. Anytime you can save money and get the most for the dollar is the best route. If you buy New then you have the satisfaction of being the "first owner" and you will have the new car smell, warranty and exactly the options that you want. This however, comes with a price and a pretty steep price at that. You will get all the options you want, but you will pay for them. You will get to be the first owner and pay for the huge depreciation that your car will take as soon as you drive it off the lot! In some cases, you can loose around 30% of your investment within the first 30 seconds!
Now, buying a new car does offer some perks and sometimes it is the best way to go if you are looking to hide any negative equity on your car. The rebates can be attractive and you will often have 0% financing available. Just be careful, when you use the rebate to hide your negative equity, it will help you get into a new car for MSRP. But remember you are adding the negative equity to a vehicle that will still take a HUGE depreciation and this rebate effects the used car value later on when it's time to trade again.
If you buy a pre-owned vehicle, you will save money. You are paying the amount of the depresiated value of the car based on mileage, condition and age. Although, you will save money and sometimes a lot of money, for cars that have a hard time selling, there are concerns also. If someone trades in a car, usually it is for a reason and most times this is mechanical in nature. They can and will be taken care of at any reputable lot, but they might not have been told about any problems when it was traded in. I'm sure the customer didn't say that "the reason I want to trade in this car is due to the transmission slipping and didn't want to pay the 2,000.00 to fix it." They put in some thicker transmission fluid, slip goes away for a while and they trade it in. The Manager drives it, puts a value on it, expecting the transmission to be in good shape, and now it is the lots problem.
When a dealership has a used car, it get state inspected, a quick check over, cleaned and out on the lot for sale in around 3 days to a week. When it is sold, it is now your problem and if you do not have any warranty with it, you are stuck! The dealership didn't know about it but once it is sold they have no liability to it or you. Make sure if you buy a used car, make sure you have a warranty, some type of warranty! The Dollar a day it will cost you is worth it for the peace of mind you will get! However, this is a negotiable price as well so be careful and don't pay too much for it! So used cars are great for saving money, but you are taking some risks as well.
Then you have Certified Pre-owned cars. This is the best value on the market. In order for the car to be Certified it must go through a VERY THOROUGH and meticulous inspection (usually 170 items or more inspected) and must be in "like new condition". No accidents, can not have dings or dents, scratches or stains. It must have all items such as an owners manual, floor mats, etc. and it will come with a warranty. It is usually a 7 year 100,000 power train warranty to cover the engine and transmission. Most will come with special interest rates that are VERY comparable with new car rates and you save the depreciation of buying new! Some cars also have extra's that you didn't have to pay for such as tinted windows, spoilers, mud guards, up graded stereos and more. If you can buy one at a good price, you have saved and gotten the best deal.
I just helped a client of mine looking to buy a new Nissan Altima in a 4 cylinder to keep her in her budget. After consulting with her and finding out what she actually wanted and pricing new vs. used we found her a 2011 Nissan Altima V6 with a premium package valued at 24,500.00 (sticker for a new one was 32,000.00). This car is flawless. It only has 16,000 miles, came with a generous 7/100,000 warranty and loaded with extra's. Great financing options and the certified program allowed her to get a more car with an extended warranty and kept her payments 40.00 a month less than if she bought the 4 cylinder new car!
In short, used car's are usually the best but Certified Used Cars are always the best value!