OneMain Financial: The Pros and Cons of New vs. Used Cars

NEW YORK, NY / ACCESSWIRE / March 20, 2023 / OneMain Financial: There are pros and cons when it comes to car ownership, whether buying a new or used vehicle. Ultimately, the best decision comes down to what works best for a person's budget and driving needs. Using a loan payment calculator can be a helpful tool to narrow down that decision.

This article will examine some pros and cons of buying a new or used car and how to make the best decision.

Pros and Cons of Buying a New Car

Pros

As the first owner, a person does not have to worry about the car's history.

New vehicles come with a manufacturer's warranty, so the car owner is covered if something goes wrong.

The buyer can choose the vehicle's features and colors.

Cons

A new car owner may have to wait months for delivery of the car if they customize it.

New cars depreciate quickly, so an individual can lose money if they sell or trade in the car too soon after buying it.

Aside from ordinarily making a down payment, buying a new vehicle often requires a higher loan than a typical used car, which means higher monthly payments.

Pros and Cons of Buying a Used Car

Pros

A used car is typically more affordable than a new car.

A used vehicle usually doesn't require as large a loan as a new car, so monthly payments may be lower.

Cons

The car's history may not be fully known, so the newest owner may not know if it has been in an accident or needs repairs.

A used car may not come with a warranty, so the new owner can often wind up paying for repairs which can be expensive and out of pocket.

The shopper may need to settle for a used car that does not have all the desired features.

Purchase a certified pre-owned vehicle

If a person is not quite ready to buy a brand-new car, buying a certified pre-owned vehicle can be a great option, especially if they're on a tight budget but still need reliable transportation. The best part of getting a pre-owned car is that it will have already gone through an extensive inspection process, so shoppers can feel confident that they're buying a quality vehicle.

Certified preowned cars often come with additional features and warranties, making them a safe investment. From luxury models to small SUVs, there's such a wide range of makes and models that it makes shopping for the perfect car easy - no matter the budget.

A Loan Payment Calculator May Help

A loan payment calculator can be a helpful tool in estimating monthly payments to help guide any big financial decision. The calculator takes into account the loan amount, interest rate, and loan term to calculate the estimated payment. This payment estimate can help potential borrowers compare different loan options and choose the best option for their budget.

How to Use a Loan Payment Calculator

To use a loan payment calculator, enter the loan amount and adjust the Annual Percentage Rate ("APR") to see examples of loan payments.

The APR is the amount of interest the borrower will pay over the life of the loan, expressed as a percentage. To calculate the APR, divide the interest rate by the number of payments the borrower would make over the life of the loan. Then, multiply that number by the amount borrowed. The result is the APR.

Once the monthly loan payment has been estimated, planning a budget is easier.

The Bottom Line

For many people, buying a used car rather than a new one can be a great way to save money. A used vehicle may have more wear and tear and not have the same warranties and protections as those with a new car. Because new vehicles often have warranties and other protections, a new owner gets peace of mind. However, a new car will likely be more expensive than a used one. Buying a certified pre-owned vehicle may be the sweet spot between the two options.

Ultimately, the decision of whether to buy a new or used car is a highly personal one. Understanding one's needs, preferences, and budget is the best way to decide.

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Notice: Information provided in this article is for information purposes only and does not necessarily reflect the views of [publisher] or its employees. Please be sure to consult your financial advisor about your financial circumstances and options. This site may receive compensation from advertisers for links to third-party websites.

Contact Information

Keyonda Goosby
Public Relations Specialist
keyonda.goosby@iquanti.com
(201) 633-2125

SOURCE: OneMain Financial