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Used Car Deals Save on Depreciation

Almost everyone has been affected by our struggling economy to some degree, causing many people to rethink their old habits and evaluate how they can save even more money.

Whether you are a struggling student, need a second car or just need a reliable vehicle, one of the many used car deals available may be to your advantage. Perhaps you have always been in the habit of buying or leasing a new vehicle. You think that nothing beats the look and smell of a brand new vehicle but realistically, there are other options available. Taking advantage of one of the many used car deals can put you on the road today and leave money in your pocket. The consumer need look no further than their computer. On-line advertising helps prospective buyers connect with vendors. In addition, auto dealers frequently peruse these sites to connect with customers and make them aware of their inventory.

In recent years, the automotive industry has been hard hit with hints of a recession. Prices have dropped dramatically with many incentives offered to persuade the consumer to buy a new vehicle. With interest rates at a historic low and huge inventories to choose from, many people have traded in their existing vehicle for a new one, leading to an abundance of used car deals. In addition, many consumers demand the latest model with the newest available features, trading in their old car when it still has miles of life left in it. Cars today can easily clock hundreds of thousands of kilometres during their lifetime. Lease buy backs often have low mileage and frequently have some of the warranty available. These may be newer models that may save you a considerable amount of money. Today it is easy to obtain a comprehensive report about the history of your vehicle, allaying any worries or concerns that you may have.

There are things that get better with age and even improve in value. Unlike a fine wine, cars are generally exempt from this phenomenon as depreciation reduces the return on your investment. Economically speaking, buying a new car may not be the wisest choice when you take into account how much a car depreciates in value during that first year. Some models experience a lower rate of depreciation and cars that are in higher demand tend to depreciate at a slower rate. The condition of the car and the mileage also impact the value. Your car will experience the steepest loss in the first year of ownership, typically an amount in the thousands of dollars as your vehicle immediately reverts to the wholesale manufacturers’ cost. A rule of thumb is that you can expect depreciation in the range of 15 – 20% each year, based on the current dollar value. With that figure in mind, does it really make sense to purchase a new vehicle when there are so many used car deals available?

Used car deals just make good financial sense, especially when you are trying to save money. Take a look around at the used car deals available and save money for tomorrow.

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Don’t Get Duped by an Unscrupulous Car Seller

With the various scams being perpetuated by unscrupulous individuals, you may wonder why a person would even bother to buy a car privately. There are those who roll back their odometers and fake the car’s service history, or those that involve dealers posing as private sellers to dump a lemon. Then there are the title washers who register repaired cars in another state to hide its history. But probably the most insidious of all is the practice of VIN cloning, where a stolen car’s VIN plate is replaced with a fake one scanned from a legitimate unit, including the door and body stickers. In this case, two parties become victims, the person whose car was stolen and the unsuspecting buyer who did the proper checks but was still duped into buying a stolen vehicle.

All of these situations are scary enough to read about, so much so that you’ll want to turn your back on buying a car privately forever. But there are distinct advantages when you buy a car privately, such as getting a rare or sentimental model that is not easily available somewhere else. There are also buyers who look to buy a one- or two-year old car that’s in very good condition and with decent mileage for its age. At that point, the car will have depreciated a lot in value but still be in very good condition, specially with today’s cars that are built better, have multi-year warranties and can go hundreds of thousands of kilometers before needing major repair. For much less money, these buyers get a decent-looking and -running car that doesn’t look dated yet.

In cases like these, it makes sense to go buy a car privately. Used car dealers may have similar cars, but these will either be more expensive or have higher mileage and wear. By going to a private seller, the buyer cuts out the dealer’s margin. But since you won’t have the protection of going back to the dealer in case you end up with a lemon or a car with a questionable title, you will have to perform your own checks in order to protect yourself. First of all, verify the car’s history by using a tracing service such as Carfax. This is money well spent although it must be said that VIN-cloned stolen vehicles have been known to pass these tests. But common sense should also prevail when you check a car out. For example, is the price too good to be true? You know the saying here. What does your gut say about the car and the seller? Oftentimes, how the owner presents or carries himself or herself will give you hints on how the car was taken car of, or if the car’s ownership is legit. Beware of deals that seem rushed, and of sellers who demand an all-cash transaction fast. Aside from these, take a mechanic with you and take your time in checking the car out thoroughly. If the owner seems to be rushed or is fidgety, then there’s a good chance that the seller is not on the up and up.

When you buy a car privately, chances are very good that you will end up with a good deal that will leave both buyer and seller happy. As a buyer though, don’t permit yourself to be rushed by the seller, check the car out thoroughly and trust your instincts.

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