New or Used - Whats Best For Me?

The U.S. Department of Transportation reports that the average life span of a vehicle is just over 13 years, with a final mileage of 145,000 miles.  Half of all registered vehicles are at least 8 years old, a third of them 10 years old or older.  The average new-car buyer trades in the car at 55,000 miles, approximately every four years. That leaves an average life expectancy of 9 years and 90,000 miles for a 4-year-old used car.  New-car leases accelerate the trade-in frequency to 3 years at 36,000 miles.  The projected life expectancy of an average 3-year-old off-lease vehicle would be 10 years and 110,000 miles.  With these excellent well-maintained cars coming off lease, and manufacturer's used-car certifications, pre-owned cars are becoming a great value.  Beware, though: buying someone else's problem makes it your problem.  Common-sense guidelines and careful inspection can distinguish  the cream puff from someone's cast-off lemon (see steps 10 & 13).  Whether you buy new or used, maintenance keeps your car reliable (see Step 20). Make sure to have your car's oil changed at the recommended intervals by a mechanic who specializes in your specific make or model.  Ensure the mechanical details are checked on a regular basis (every 3 months).   

Motorists who usually go the new car route are now giving serious thought to buying "previously enjoyed" vehicles.  $13,000 can buy a very small new car (2002 Hyundai Elantra) or a larger, safer, more luxurious used car (1997 Lincoln Continental).  Larger vehicles are safer than smaller ones, and more mass and interior volume is available for less with a used car.  A 5-year-old car in good condition can still be worth a sizeable amount.  Always buy the highest quality, youngest used car that you can afford.  If you pay more than you expected for a car that you love, you're far better off than the unhappy used-car shopper who bought a poorly-equipped (no cruise or tape player) model because it was a "good deal."

New Vehicles - While it's certainly possible to enjoy trouble-free used-car ownership, if peace of mind, trouble-free driving, and a high level of reliability are important factors for you, a new vehicle may be necessary.  New-car warranties are more comprehensive, backed by solid companies, and last for longer periods than the extended warranties that come with used cars.  The psychological aspect of owning a new car is important to some buyers.  Some people prefer to hold on to a vehicle for long periods of time, eight to ten years.  By buying a car or truck fresh from the factory, you can ensure it gets the extra care needed for a long life.  If you plan ahead, franchised dealers can special-order a vehicle from the manufacturer outfitted specifically for you.  New-car dealers can find the vehicle of your dreams through factory locating networks and through dealer-to-dealer trades.  Buying new gives you more control over the optional features.  Used-car buyers are usually limited to what's available within a fifty-mile radius.

Used Vehicles - Two excellent reasons to buy a used car are (1) when you have a fixed amount of money and can't afford a new car or regular payments; or (2) when you can buy a better used car than any new car you can afford.  Used cars provide more flexibility to choose a more expensive vehicle or step up to a better model than could be purchased new.  The same money can buy a brand-new Hyundai, a two-year-old Taurus, or a six-year-old BMW.  If you pay cash, you significantly lower your car expenses by eliminating financing losses and higher new-car insurance costs.  So if your aim is reliable transportation for a good price, late-model used cars are the way to go. 

Experian AutoCheck Vehicle History Reports -  Don't make a $10,000 mistake! We highly recommend that you order an AutoCheck Report for any used vehicle under consideration. It's your best protection against buying a used car with costly, hidden problems. With a database comprised of over 15 billion records on more than 330 million vehicles, AutoCheck can help you protect yourself against title and odometer fraud, lemon cars, salvage vehicles and numerous other hidden conditions that can impact the safety and value of your next vehicle. Every US-registered vehicle is identified with a unique VIN number. Using that unique number, Experian researches the history of the vehicle while you wait, delivering a custom Vehicle History Report direct to your computer screen. Most of the dealer-only auctions in North America rely on Experian (AutoCheck), that's why I personally recommend them to you.

Experian checks for possible problems using four distinct methods.

• First they check the title history files gathered from dealer-only auctions located across North America.  Lemons, previously totaled then rebuilt vehicles (salvaged), and victims of flooding will show up by checking vehicle title histories with auctions.

• State registration and auction records will also show previous fleet or rental car history as well as government or law enforcement service. Insurance company records will show if and when your vehicle has been involved in a claim settlement. Previous paint work, collision damage, flood history, theft, fire damage, or vandalism all show up by using the insurance industry database.

• State DMVs and repair shops also keep strict records relating to odometers and mileage when a vehicle is registered and inspected. Vehicles that have had their odometers replaced, cars imported from Canada or Europe, vehicles whose odometers have rolled over (gone over 100,000 miles), and vehicles that have had their odometers rolled back (tampered with) will all show up by checking these records.

• Franchised dealers and major repair chains keep detailed maintenance and service records on all vehicles that are presented for service.  Lemons, or cars with recurring mechanical problems will be discovered by using the manufacturer's and repair shop databases.  Your report will tell you where (which dealer), when (date of service), and how many times a vehicle was serviced during it's previous life.

Your initial Experian lemon check is FREE, just enter your car's Vehicle Identification Number (VIN) into the box located HERE. Once you've input the VIN, click the submit button, and your complimentary summary report will be generated. The summary information will include make and model details for your car, and the number of additional historical events available through Auto History. You will not be charged for your Auto History report until you click on one of the other Report Tabs that show more detailed information. I have used their service for many years and have never been disappointed. I would hate to see anyone make a $10,000 mistake!

Depreciation Makes Used Cars a Better Investment - next page >