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Pros & Cons of Buying Used Cars: Is it Worth it to Buy a Used Car?

Thinking about buying a used car, but not sure if it's worth it? The Credit Union of Southern California (CU SoCal) is here to explain everything you need to know about the pros and cons of buying used cars.
The greatest benefits of buying a used car are related to savings. Indeed, most people would prefer to buy a new car, but once they start shopping, they realize just how costly it is to drive new and opt for a good used car instead.
However, there are several risks associated with buying a used car, especially when you buy from an individual, in that you won’t know the car’s true history.
In this article, we’ll discuss all the advantages and disadvantages of buying used cars, so you can make an informed buying decision
CU SoCal is one of the fastest growing credit unions in Southern California, providing checking, savings, and loan products with quick pre-approvals, no application or funding fees, and other great member benefits.
Call CU SoCal at 866.287.6225 to schedule a free no-obligation auto loan consultation, or learn more about our auto loans now!

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Advantages of Used Cars

There are numerous advantages of buying a used car, particularly when it comes to savings. Here are some advantages of buying used cars:
Less Depreciation: Vehicle depreciation is the rate at which a car’s value declines over time. How quickly a car depreciates, or loses value over time, is based on a range of factors. Using online valuation tools such as Kelley Blue Book, you can get an estimate of your car’s current market value. You can then subtract that number from the car’s purchase price to get a sense of how much your vehicle has depreciated.
Better Price: Used (pre-owned cars) tend to cost less due to depreciation and the fact that they have more miles. Unless you’re buying a luxury used vehicle, you will certainly find lower priced options buying used.
You Can Buy a Better Car: One advantage of buying a used car is they provide more value for the dollar. A high-end used car can often be purchased at a much lower price than if it were purchased new.
Fewer Fees: Dealerships add fees to new cars, including a delivery/destination fee, documentation/processing, pre-delivery inspection, dealer prep, or vehicle procurement fees. Used cars typically have just a few fees: title and registration fees, used car sales tax, and documentation fees.
Fewer Dealer Add-Ons: Dealerships know they can earn extra money by selling added features to new car buyers These include anti-theft devices, window tinting, upgraded wheels, all-season floor mats, splash guards, wheel locks, cargo trays, alarm systems, an interior protection package, etc. One advantage of buying a used car is you will save you money because dealers don’t usually up-sell additions, what you see is what you get, and there’s less pressure to buy extras.
Better for the Environment: Some people believe that by buying used they are helping the environment by extending the life of a car, rather than contributing to use of resources required to manufacture a new car. On the other hand, many new cars feature high gas mileage, hybrid gas/electric power, and other green features. Some states require your vehicle to pass an emissions test after you purchase it, which could be an issue with an older used vehicle.
Lower Insurance Costs: The simple answer is that car insurance premiums do not go down or up just because a vehicle is older. There is very little correlation between the age of the vehicle and car insurance rates, although you can certainly adjust your coverage levels if you would like to lower your monthly payment.

Disadvantages of Buying a Used Car

While there are numerous advantages of used cars, there are reasons to be cautious when buying used. If you buy used from an individual, we recommend having the car checked by a licensed mechanic or at the very least, a friend with knowledge of auto mechanics. Purchasing a used car from a dealership, or through one of the reputable online retailers, can help you avoid purchasing a lemon.
Here are some used car issues to look out for:
Murky History: Used cars may have a murky past, such as flood damage, accidents, recalls, etc.
How can you learn a vehicle’s history? Here’s some important information from the Federal Trade Commission. Visit the National Motor Vehicle Title Information System (NMVTIS) website,, to get a vehicle history report with title, insurance loss, and salvage information. This site lists NMVTIS-approved providers of vehicle history reports.

NMVTIS-approved providers offer vehicle history reports to consumers, car dealerships, and financial institutions. But not all vehicle history reports are available through the NMVTIS website. Reports from other providers sometimes have additional information, like accident and repair history:
Lack of Warranty Coverage: Dealers may offer limited warranties on used cars, so be sure to ask. Certified pre-owned cars, for example, come with several benefits (such as multi-point inspections) and can be well worth the extra cost.
More Expensive Financing: Dealerships tend to offer better loan financing on new cars because they receive manufacturer bonuses for moving new cars off the lot, and they pass these savings to the consumer. Always ask for the lowest loan interest rate/APR on any loan.

Is it Worth it to Buy a Used Car?

For budget-conscious shoppers, there are benefits of buying a used car. Not only can you save money, you can likely get a higher-end model car for less than it would cost new. Used cars purchased from a dealership can include a warranty — be sure to ask what the warranty covers and how long it will be in effect.
Certified pre-owned cars that are sold by car dealers are the safest bet, as they have to meet specific requirements to be considered certified. Purchasing a used car from an individual seller is more risky, since you won’t know the car’s true repair or accident history.
So, is it worth it to buy a used car? We think so! Before any large purchase, we always recommend shopping around and choosing the option that best meet your needs and budget.

Other Car Buying Options

In addition to buying a used car, there are several other options that can be cost-effective and meet your driving needs.
New: Dealerships are filled with new cars ready to be driven off the lot, and you may be able to find special promotions and low or zero loan interest rate. To see which discounts are offered throughout the year, read: When Is the Best Time to Buy a New or Used Car?
Certified Pre-Owned (CPO): For this answer, we turn to, which explains that “a CPO car is one that is previously owned, usually with no more than 60,000 to 80,000 miles and no older than five to seven years. (The time and mileage warranties vary by manufacturer.) CPO cars are backed by the original manufacturer, subjected to a rigorous, multi-point inspection and come with an extended warranty from the original date of service good at any dealer in the country.”
Lease: Leased vehicles are typically new and are offered by all dealerships. A lease simply refers to the terms of the transaction. As an alternative to purchasing a car, leasing a car means taking possession of it for a short, fixed period of time. Like with purchasing a new car, you’ll make fixed monthly payments based on the loan interest rate you received. The main difference between leasing and purchasing new, is that when you purchase a car it becomes fully yours once the loan is paid in full. With a lease, when the term of use ends, the vehicle must either be returned to the leasing company or purchased for its residual value.

Why Savvy Consumers Choose CU SoCal

For over 60 years, Credit Union of Southern California has been proudly serving the Southern California community. We provide our Members with checking, savings, personal loans, auto loans, and other loan products with quick pre-approvals, no application or funding fees, and other unique advantages.
We are known throughout the area for our excellent Member service and we are proud to be serving the community where we work and live.

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Please give us a call today at 866.287.6225 to schedule a no-obligation consultation with one of our auto loan experts.

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Credit Union of Southern California (CU SoCal) is a leading financial institution empowering those who live, work, worship, or attend school in Orange County, Los Angeles County, Riverside County, and San Bernardino County to reach their goals and build strong financial futures. CU SoCal provides access to convenient money management services and offers competitive rates and flexible terms on auto loans, mortgages, and VISA credit cards—turning wishing and waiting into achieving and doing.


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