Are Late model used cars a good buy ??Jul 11 '01 Write an essay on this topic.
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The Bottom Line Late model used cars can be a good buy if you know how to shop
Here a a simple way to compare the TRUE cost of a used car vs a new car. First, go to the NEW car lot and see how much they cost brand new or use an online pricing service such as autobytel Second, take a look at some used cars of the same model and get some prices, pick one that YOU like and think might be a good deal. Third, subtract the year of the used car from 2001 (or whatever the current model year is for the car you are considering) Forth, Find out how much it would cost you to LEASE the NEW car for the time period calculated in step 3 Fifth, Get the RESIDUAL VALUE of the car at the end of the lease, this must be listed by law on all leases and can be found from the dealer or online car buying site. If the RESIDUAL VALUE of the car is is LESS than the cost of teh used car, you will be better off LEASING the NEW car for 2-3 years and buying the car at the end of the lease for it's residual value. If the RESIDUAL VALUE is MORE than the used car price go ahead and buy the used car provided it is in good condition. Another way to do this is to not buy a "UPSIDE DOWN" car. What I mean buy this is you should be able to pick up the payments where the privous owner left off. If a new car would cost $350 a month for 72 months then a two year old car should be NO MORE than $350 for 48 months. Base it on the car being paid when it is 6 years old, no matter when YOU got it, or how long you will actually finace it. It is just for cost comparison purposes only. I doubt most people will be able to find really good deals on used car lots, your best bet will be to buy from an induvuidual and see if you can take over the payments.  |
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