Used car buying pros and cons
By Eric Peters

Buying even a slightly used car can save you a bundle vs. buying the same car brand-new. But there are different risks to be aware of -- and to prepare yourself for.

* Financing -- A chief advantage of buying new is that while the cost of the car may be higher, the cost of money (the interest rate you pay on the loan) is usually lower. It's important to take into account the total cost involved -- not just the car and its purchase price, but the interest rate you'll be paying if you finance the purchase. A $15,000 new car with a zero percent financing deal could make more sense than a used $10,000 car with a high interest rate loan.

* It's worth less faster -- Another thing to consider is that a car that's already a couple of years old when you buy it will be worth less, sooner than a newer car. That may be something you'll want to consider if future re-sale/trade-in is a factor. On the other hand, if you are the kind of person who "drives it until the wheels fall off" this won't matter -- and the money you saved up front on depreciation losses (the biggest hit on a new car purchase) is money in your pocket.

* Each used car is different -- Unlike a new car, which is exactly identical to others of the same make/model (other than superficialities like color, trim and so on) every used car is individual and will have its own unique service history, including the legacy of the treatment (good or bad) it received by its former owner(s). Of two otherwise identical, same-make, same-model, same-year vehicles, one may have had a very easy prior life -- while the other one was "rode hard and put up wet." The first car might have another 100,000 miles of faithful, reliable service left in it; the second one might be in need of expensive repairs or its systems closer to being "worn out" -- and likely to cost you a lot more in terms of upkeep and maintenance.
This is why it is so important to have any used car you are considering buying thoroughly inspected by a shop you trust before you commit to buying. If the seller balks, walk away. Odds are you'll have done yourself a big favor.

* Fewer options -- With a new car, you can usually order exactly what you want in terms of trim levels, engine choices, colors and so on. With used cars, you may have to compromise, especially if you find an otherwise great deal on a car that is a different color than you might have chosen, or doesn't have a sunroof, etc. You'll have to weigh the importance of being able to get exactly what you want (and paying full new car price) or settling for a car that may not have exactly everything -- but cost you a lot less.

* No "grace period" -- With a new car, one of the big perks is the car should not require anything beyond very basic upkeep (oil and filter changes, tire rotation, etc.) for at least the first couple of years of ownership. A used car, on the other hand, has used brakes (even if the pads are new, the other system components, including things like the ABS pump on models so equipped, aren't), miles on the clutch, the automatic transmission fluid, timing belt (on cars with overhead cam engines) and so on. You'll be be paying to fix/replace things like this sooner than you otherwise would -- and it's important to keep that in mind when buying a used vs. a new car.

* Warranty coverage -- More precisely, the lack thereof. All new cars come with a full "comprehensive" warranty that covers just about anything that might go wrong; with a used car, that warranty may have expired. At the least, it will be closer to expiring. You can usually buy an extended warranty, of course -- but the "piece of mind factor" is something many buyers consider to be well worth the added cost of buying a new car vs. a used one.

* It's not new -- This last (and most subjective) variable is one you'll have to weigh for yourself. For many people, that "new car smell" matters a great deal -- and of course, just isn't there with a used vehicle (even if you spray the interior with some of that aerosol "new car smell" stuff you can buy).