Should I Buy or Lease a New Car? Used or New Car?

Should I Buy New or Used? Or Purchase or Lease?
Hey, this is Eric Smith and I'm here at Black Rock coffee in Boise, Idaho. Today we're doing our coffee and car questions answered. We get questions from our customers all the time and I want to take a few minutes to answer those, here, in just a comfortable environment where we all like it. 

New vs. Used

So, let's start with the one of the biggest questions new vs. used. Should you purchase a new car or a used car? And there are advantages and disadvantages of all those, but I'll cover the big ones right now. So, clearly with a new car you get the newest safety technology, and convenience technology. Things like Apple CarPlay®, and you know forward collision mitigation, all those great features which I really enjoy. But when you look at a used car, you know, clearly you're gonna get a discount on price. So, really you're gonna have to weigh the benefits of both. 

There's a couple things that put a wrinkle in that, like maybe a certified pre-owned car which is only three to four years old. You're gonna get great warranty and that kind of stuff on it, a discount over the new one, but still some of the newer features. So, really things to keep in mind. 
  • Do you want the newest, latest, and greatest technology? New car. 
  • If you want to go for a discounted price, of course, go pre-owned.

And really what you might even be able to do is get a, say a, more luxurious car than you were looking at new and in a used trim at a better price. So, those are the weigh ins and trade-offs you have to look out when you're considering new, versus used. 

Lease vs. Buy

Another question we get all the time is, "Should I purchase, or should I lease?" Or really what they're asking is, "Should I get a loan, or should I lease?" You know there's really no difference between the two at the beginning, right. When you lease a car or purchase car you're gonna be making payments to a bank, and you've got to keep the car in good shape, and have insurance, and those kind of things. Really what it comes down to is, longer into the transaction. 

You know most leases around 36 months, and the average purchase contract is now about 66 months. So, if you were gonna make 66 equal payments, you would own a car if you purchased it. On a lease, of course, you're gonna make thirty six months or so, and at the end of that time you'll have to decide do you want to buy the rest of that car, trade it in, or just turn it in and start over. 

I'm a big proponent of leasing because I like to have a newer car and the newer technology, and that kind of stuff, and I'm used to having a payment. And it's very likely that you can go from a lease in your current car, and when that time comes up, lease the exact same trim package in a new vehicle and have your payment be about the same. So, that's really attractive to me but it's not for everybody. So, you'll just have to decide when you're looking at your car, which route you want to go. Certainly, leasing is a more attractive version upfront because you're gonna have such a low payment, versus our purchase, but really it's up to you. 

Used Car vs. New Car Lease

One thing that a lot of people ask us is, what type of used cars should they get, versus a lease. So, this question is kind of used car vs. leasing a new car. This is one that I think about all the time. If you look to buy, we'll say you want a car that has a $350 payment, okay, that's a pretty common one. Well, you have to find a used car that's around $15,000, or you could lease a new car. You know, so that's something that's really attractive to me because if you lease a new car for that $350 payment, of course, you have a brand-new car, with no miles, with all the safety features, and everything that's currently available. Or, you have this used car, that might be a great car like a Honda Accord. But it's probably gonna have 50,000 to 60,000 miles on it, it's very likely to be out of its warranty, so you'll be handling all the costs, and the cost of a car go up over time. So, really the thing to consider is, do you want to lease a new car, or get a used car that you know has 50 or 60 thousand miles on it. So, again those are things to weigh, and what it will cost you to own the car over time.
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