Buying A Used Car From A Dealer Or Privately - Which Makes More Financial Sense?

Money is tight for many people today, and deciding whether or not to invest in a new used car requires some serious consideration

. Unless you are feeling quite financially sound, the decision to buy a new car comes only after your current vehicle becomes more trouble than it is worth.

When choosing a used car, you'll have two options -- purchase from a dealership or from a private party. It's important to keep in mind that you may simply be ridding yourself of one problem car and replacing with a different set of problems.

When purchasing a used car from a private party, it is not likely to have a warranty and probably hasn't been inspected by a mechanic. The best way to avoid trading one problem car for another is to shop at car dealers that are reputable and that offer at some type of warranty on their used car selection.

What Does It Cost To Own A Used vehicle?

Financing a used car involves several specific expenses and some variable costs. The fixed costs involved with owning a car include making payments on the purchase price, the interest on the loan, insurance, and regular maintenance. Your auto dealer will provide you with a warranty that covers most of the more expensive problems. Many used car dealers offer useful extras such as free tune-ups and oil changes.

Most auto dealers that offer used vehicles only offer newer model used vehicles that require you to finance the purchase. On the other hand, buying an older model used car is often inexpensive enough to pay for in cash. While a much older model car purchased from a private party may be "cheap," it may come with quite a few hidden costs. Repairing and maintaining an older used vehicle involves finding replacement parts. Older cars need more frequent repairs than new cars and are often less fuel efficient, meaning you'll spend more money on gas.

When older cars were designed and built, fuel efficiency and emissions were not considered. You may be able to get a "great deal" on a car from a neighbor down the street, but that car may never pass emissions tests without sinking a great deal of money into repairs.

Shopping For A New Used Vehicle

Shopping car lots allows you to compare prices, options, and interest rates from a variety of auto dealers. Trade-in values offered on your current car can vary from dealership to dealership. Searching online is a great way to compare the products and services available from an auto dealer.

Look for web sites that provide you with interactives that help you to select the best car for your needs and those which have their current inventory available online for your browsing convenience.

While there are some great used vehicle deals available from private parties, finding one can be a gamble. On the other hand, buying from a reputable auto dealership can provide far more reliability and lower maintenance and gasoline costs than an older car purchased from a private party.

by: Christine Harrell

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