Why should you purchase a used car?

The automobile industry is changing drastically. New cars are getting costlier, fuel prices are rising, and new electric vehicles are launching. So, if you are a middle-class person on a restricted budget, what should you do? Should you buy an electric car? However, they are very new and contain some extremely pricey components. Then, used cars? Well, let's dive into the article to find the answer.

Used Car vs New Car: Which is better?

1.Used cars save you money

It should go without saying that used cars are less expensive than new cars. You could get an old SUV for the price of a new hatchback. If you have a limited budget but still want to be the proud owner of a car, used cars are the greatest option. In most cases, the price difference between a used car and a new car of the same model is roughly 50%. Even if the car dealer offers a hefty discount and additional benefits, new cars are still more expensive than older models.

2. Depreciation

If you are searching for reasons to decide on whether to go for a used car or a new car, look into the depreciation aspect. Newer cars depreciate at a considerably higher rate than older vehicles. It is even believed that during the first few years after purchase, a new car loses the majority of its worth or roughly 50% of its value. So, if you are someone who replaces their car every two to three years, new cars might not be the best option because you won't get a good resale value.

On the other hand, the depreciation rate of a used car is substantially lower. You may get a decent amount on a second hand car if you resale it.

3. Insurance

The cost of a motor insurance premium is dependent upon the price of the car. If you are buying a pre-owned car, the insurance cost won't impact your wallet. This is because used cars are inexpensive and have already seen most of the depreciation. It is also possible that the used car you are buying with a used car loan is still covered by the insurance. In that situation, all you have to do is transfer the insurance policy to your name. 

4. Other Costs

When you buy a new car, you will have to spend a major amount on registration fees, road tax receipts, and more. All of these expenses place significant pressure on your budget. However, if you buy a used car, you can save a lot of money on these. Do you want to learn how to do it? Take a look at the pointers below.

• The car's registration expenses are determined by the current market price. Since used cars are less expensive, registration fees are also less expensive.

• When you buy a pre-owned car on an affordable second-hand car loan interest rate, you are free from paying the road tax receipts. Such taxes must be paid at the time of purchase by the new car owner.

Things to Consider When Buying a Used Car on a Used Car Loan

• The car condition and the documents are key to securing an affordable second-hand car loan interest rate.

• Make sure you spend enough time researching the used car market before deciding on your favourite vehicle. Examine a number of online reviews, as well as the opinions of automobile experts on the specific manufacturer and model. You can also enlist the assistance of a local mechanic to help you navigate the market.

• Examine the vehicle in person before making a purchase. Look for things like broken headlights, rear view mirrors, dents, and so on. You should also check the interior of the vehicle to determine if the seats and infotainment system are in good working order. Don't buy that car if there are any major flaws.

• It is critical to determine whether the seller is the original owner. There have been countless theft instances in India in recent years, with the majority of them involving cars and motorcycles. As a result, you must ask for the car's RC papers, original sales invoice, and road tax receipts from the seller or dealer. To avoid legal issues, you should avoid buying an automobile where the previous owner has not paid the road taxes.

• Examine the car insurance paperwork as well as the servicing records. It will show you how the car has been handled in the past and whether it has been involved in any serious collisions. 

• Take a test drive to understand the working of the car's engine. 

• Avoid buying a car that is significantly older and on the verge of being deregistered (15 years)

To conclude:

Used cars nowadays provide practically all of the benefits that a new car does. So, if you are on a tight budget, buying a secondhand car is a good idea.