Haven't been buying cars for as long as others but gone through 3 since I started and all of them had low mileage for the year of the car but the thing is this it really stems down to how much you bough the car for. Now if you read post such as the ones about 1-5% under invoice your good but people who buy it for msrp or worst dealer posted price with all the stuff you don't need that's where there is the problem. If you bought the car under invoice and negotiate properly you should be able to walk away from your loan because they will pay off your loan or better cut you a check for the difference.But if you buy a car for Msrp you will most likely roll the money into new loan or pay to make the loan even up front. My experience has been since I got the cars for a great price originally 2/3 times I had some equity to put into my new purchase and the other I was able to walk away and they paid loan off. Of course this isn't accurate if you paid cash but for financing this was my experiences.
You will obvs loose down payment also, but the key is not to put down a terrible amount just enough to get the monthly price you need when negation over price has ceased.
I have always bought my Jeeps for slightly under invoice, financed with no down payment and relatively low interest rate. Traded them in after 2 or 3 years, always got more on the trade in than I owed on the loan. Use the excess for the down payment. Don't put on tires, brakes, etc. only oil changes and wipers. In an era of 3% or 4% interest rates gives you another alternative to keeping it till the wheels fall off. Something to be said for both approaches.
This may, or may not work, for others. When I bought my first new car at the age of 20, in 1970, I took out a 3 year loan to pay for it. Back in those days a 3 year loan was about the max term. I drove that car for 7 years. After I paid off the loan I put the amount of my monthly payment in savings, plus whatever extra I could manage, for the 4 years of loan free driving. I did most of my own repairs in those days, the cars were much simpler, and new car warranties were 1 year for the most part. After that four year period I had saved enough to buy a new car with my saved cash. That first loan was the only auto loan I've ever taken out. I've been replacing my cars about every 6 years, and that works out just right for me. I know interest rates aren't that bad these days, but I can remember new car rates in excess of 6%. I hate giving money to banks. Like I said, this may not be for everyone, but when I go vehicle shopping I look for what I need, and what excites me to drive, and normally order from the factory, paying a little under invoice. I make a car payment every month, to myself.
I factory order every new car or truck with the expectation that I will get a decent discount if there is an "earn and turn" that allows the dealer more vehicles than his factory allotment. There are other discounts like advertising and flooring costs as I pay cash and drop off my trade in when I place the order. I buy a new car or truck every other year and while it may work for me, it is not for everybody. I like the way Jacko15 explained his buying practices. One other thing; I've been buying from the same dealerships (family owned) for almost 26 years.
Agreed guys I think every person/budget has there certainwaythat works for them. I'm just glad I never allowed myself to get into a spiral because once you make that 1 bad deal you will be in a hole that would be hard to get out of.
Pretty much every article I've read on buying vehicles suggest that if you want to have the lowest costs of vehicle ownership, buy a used one, 2 years old (largest depreciation hit), pay cash (no interest), and sell it in 3 years for another 2 year old car.
Vehicles with lower depreciation schedules than not are cheaper to own, as they simply lose less value over time.
You "never" save money buying a new vehicle.
That said, I don't practice that -- I hate buying cars, I'm not a car "guy", so I drive them in to the ground. I bought new because the model just swapped over and was significant enough that I didn't want to wait another 2 years, as my truck wasn't worth keeping that long.
The biggest hit on depreciation happens in the first 1/10th of a mile, unless the dealer's lot is 2/10ths long.
Some of the sources suggesting a 2-3 year old car will note that when you buy a used one, you should plan on spending a few percent of the price in either fixing things wrong or making it closer to what you were looking for.
Actual depreciation varies widely based on manufacturer, manufacturer pricing policies, rumors on reliability [that may or may not have basis in fact] such that
some cars are better buys as new than as used because the used ones retain too much of their sales price.
I tend to buy either new or used, depending on which has the best price/features/condition/cherry-out cost, but have gotten too cheap to make payments and just paid cash for last few decades.
Like with many other things in life, it's not always just about the money. Sure, it needs to be taken into consideration, but so do a number of other things. I bought my last used car when I was 19 years old, 44 years ago. A "cream puff" that I dropped off at the junk yard less than a year later. To each his own, but I want a new car when I buy, not because I'm loaded with dough, but because I know any problems will be mine, and not someone elses. I respect anyone who is into maximizing their transportation dollars, but imagine a world where nobody bought a new car. Also, I come from a long line of car guys. I can remember the sense of joy my father had when he came home with a new set of wheels. And I have many friends who believe in buying only used. They're usually lined up at my door when I start talking new car. My used cars are barely broken in after 6 years. No matter what your car buying philosophy is, just one reminder, an old saying from a dear friend who owned a transportation company, "Keep the rubber side down!"
That's why I buy new. I like to know the history. Sure, you can get great deals used.
When I ever look at used, the prices seem to high. I think, I might as well buy new. You have less financing options as well. You also have the option of ordering only what you need/want with new.
Like someone said, you need to get a decent deal when buying new. I've seen 1-2 year old used ones go for close to the same price as what I paid, new.
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