financing new vs. slightly used

[black13]

So parents are interested in buying a vehicle and asked me to help them.

Now I told them buying new doesn't make sense when you lose 20% of the value as soon as you drive away but they much prefer the security of knowing nothing will be wrong with the car for a while.

So I told them how about buying a 2009 or 2010 which is practically the same model just without slight revisions, while they have already gone through that huge initial depreciation so overall losses would be lower in the long term and you would save more than enough to cover any repairs after warranty runs out.

Problem is they prefer financing and well used finance rates are sure alot worse than new rates.

So without going to a dealer and having to sit through the BS of most sales guys to figure out the rates I thought I'd ask here first.

Is it better to buy say a 2009-2010 model at huge finance rates of dealers or to buy 2013 model at lower rates?
Which is better in the long term?

Vehicles in question are Mid-size luxury SUV's such as
Acura MDX
Infiniti FX35
Lexus RX350

The 2010 models all go for around $35k used with less than 100k on them.

And any problem with these model cars? I was looking at the Murano as well but you can get the Infiniti for almost the same price. And anyone know of a great deal on any of these models they can point out?
Thanks.

[Mibz]

Nobody else can answer this for you. Seriously.

Go find the cars they want. Get numbers on them from the dealers. Get numbers on them from the bank. You will then have a bunch of numbers. Look at the lowest number, that's your best financial decision.

Then remember that your parents are human and things like peace of mind and service history are tangible benefits to them, possibly worth the extra cost. Let them make their own decision from there.

[Blue]

For me personally i will go with a Brand new Vechle rather than a used one.
Unless its under 20,000 KM, good Price, also a year old than ill get that.

[Redlyne_mr2]

Originally posted by Mibz
Nobody else can answer this for you. Seriously.

Go find the cars they want. Get numbers on them from the dealers. Get numbers on them from the bank. You will then have a bunch of numbers. Look at the lowest number, that's your best financial decision.

Then remember that your parents are human and things like peace of mind and service history are tangible benefits to them, possibly worth the extra cost. Let them make their own decision from there.

[ExtraSlow]

If you are financing a large portion of the purchase, in many cases brand new is a better deal due to the lower finance rates.

If you can buy used and pay for the ride in cash, that's often smart.

[D. Dub]

Can they get a vehicle loan/credit line at their bank with a better rate than the car dealers?

[msommers]

Used - HELOC if they have a house since those rates will be better than a basic LOC which depending on your credit is typically prime+2% for unsecured
New - rates from the dealerships are usually hard for the banks to match.

As for buying new or used, I guess it depends if they're likely to sell. My parents bought new but they keep their vehicles until they're not worth repairing anymore. Plus not having the hassle of dealing with previous owners was a piece of mind.

That said, I bought my 4Runner 1 year old with 18,000km on the clock and saved $11,000. Now that we're approaching 2013, getting into a 2012 wouldn't be that difficult and would definitely save some cash, especially on an Infiniti.

There is also a matter of remaining warranty. When getting into luxury SUVs, I'd be pretty worried not having anything but the powertrain left.

[black13]

Originally posted by Mibz
Nobody else can answer this for you. Seriously.

Go find the cars they want. Get numbers on them from the dealers. Get numbers on them from the bank. You will then have a bunch of numbers. Look at the lowest number, that's your best financial decision.

Then remember that your parents are human and things like peace of mind and service history are tangible benefits to them, possibly worth the extra cost. Let them make their own decision from there.
ugh I guess that's the only way. I just dread going to dealers and dealing with such pushy saleman. But alright. Wish their websites showed used finance rates though.


Originally posted by ExtraSlow
If you are financing a large portion of the purchase, in many cases brand new is a better deal due to the lower finance rates.

If you can buy used and pay for the ride in cash, that's often smart.
yea I told them that too, even suggested buying a higher end sedan but like a 2006 so they could buy it out right but ugh they just don't like driving "old" cars. I guess peace of mind driving really is worth the extra cost to some, but to me it'll never make sense.


Originally posted by D. Dub
Can they get a vehicle loan/credit line at their bank with a better rate than the car dealers?
Yea they can do that but I gotta see how bad the interest rate on used cars are at the dealer. If it's a big difference I'll get them to do that.


Originally posted by msommers
Used - HELOC if they have a house since those rates will be better than a basic LOC which depending on your credit is typically prime+2% for unsecured
New - rates from the dealerships are usually hard for the banks to match.

As for buying new or used, I guess it depends if they're likely to sell. My parents bought new but they keep their vehicles until they're not worth repairing anymore. Plus not having the hassle of dealing with previous owners was a piece of mind.

That said, I bought my 4Runner 1 year old with 18,000km on the clock and saved $11,000. Now that we're approaching 2013, getting into a 2012 wouldn't be that difficult and would definitely save some cash, especially on an Infiniti.

There is also a matter of remaining warranty. When getting into luxury SUVs, I'd be pretty worried not having anything but the powertrain left.

yea I guess waranty is more important on a Luxury SUV, so are you saying powertrain warranty is not important but the rest of the bumper to bumper is what really matters?

And just like you saved 11k, wouldn't that extra money be more than enough for repairs after warranty runs out? I'd imagine it would be enough for at least till the car hits 200k unless I'm being too kind about dealership service charges.

[blitz]

Completely comes down to finance rates available.

When I picked up my B200T, Mercedes was offering 0.9% financing on CPO vehicles vs 3.9% on new. I also got more warranty than a new vehicle because of the certified extension.

[msommers]

Originally posted by black13
yea I guess waranty is more important on a Luxury SUV, so are you saying powertrain warranty is not important but the rest of the bumper to bumper is what really matters?

No I'm definitely not saying the powertrain warranty is not important, but not having warranty for the electrical problems that seem to happen more often on luxury could add up quickly.



And just like you saved 11k, wouldn't that extra money be more than enough for repairs after warranty runs out? I'd imagine it would be enough for at least till the car hits 200k unless I'm being too kind about dealership service charges.

I think buying a used luxury vehicle and hitting 200,000km with only 11K in repairs would be a great number. But my gut says it's probably more by that kind of mileage.

[max_boost]

HELOC that shit

:D

[ray8181]

Originally posted by black13

ugh I guess that's the only way. I just dread going to dealers and dealing with such pushy saleman. But alright. Wish their websites showed used finance rates though.

most sites usually show the interest rate on the build & price part of the site.

Working for a car dealership i actually tell people it is sometimes cheaper going new than used (depending on interest rates of course). even though i make more money off a used vehicle, its just a smarter way to go sometimes.

if you got any questions you can pm me. i dont live in calgary so i wont try to sell you a car lol

[The_Rural_Juror]

Originally posted by max_boost
HELOC that shit

:D

2010 models? Are the OP's parents students or something?

[black13]

Originally posted by msommers


No I'm definitely not saying the powertrain warranty is not important, but not having warranty for the electrical problems that seem to happen more often on luxury could add up quickly.



I think buying a used luxury vehicle and hitting 200,000km with only 11K in repairs would be a great number. But my gut says it's probably more by that kind of mileage.

Damn that scares me even more. No wonder there's such an influx of these 2010 or so models on kijiji with all of them close to hitting 100k on the odo.


Originally posted by ray8181


most sites usually show the interest rate on the build & price part of the site.

Working for a car dealership i actually tell people it is sometimes cheaper going new than used (depending on interest rates of course). even though i make more money off a used vehicle, its just a smarter way to go sometimes.

if you got any questions you can pm me. i dont live in calgary so i wont try to sell you a car lol
ok good to know. Thanks will send you a pm if i have anything I can't find.
I'm looking at Lexus and their used rates are alot better than infiniti's for sure.

And is January a dead month? I figure its a good time to buy since its after all the Christmas shopping leading to lower sales and so dealers may be a little more desperate for a sale. If not what's the best time to buy?


Originally posted by The_Rural_Juror


2010 models? Are the OP's parents students or something?
I'm not a fan of Heloc and not gonna advise them to use it. Not interested in paying crazy interest either so I'll see how it goes after I start my search in January. If the saving is gonna be huge then they may just buy it out but they prefer payments with some downpayment.

[ray8181]

Originally posted by black13




And is January a dead month? I figure its a good time to buy since its after all the Christmas shopping leading to lower sales and so dealers may be a little more desperate for a sale. If not what's the best time to buy?




winter in general is a dead month lol. best time to buy is from march-august. thats when dealerships are clearing out previous year models, which results in more used car inventory, which makes better inventory blowout sales