Why Buying Used Might Be The Smartest Decision You Make

If you’re in the process of weighing the pros and cons of buying a used Ford, be warned: you might find that your list in favor of doing so, far outweighs the arguments against it.

With more resources available to us than ever before, consumers have the luxury of performing their due diligence long before they step onto a dealer lot. This comes in the form of researching vehicles that have caught their attention, comparing and contrasting vehicle features against one another, determining all financing options available to them, and weighing trade-in estimates against one another. By combining the resources served upon automaker, dealership and third-party consumer sites, there’s really no reason why a prospective car buyer shouldn’t feel confident in making a truly informed decision.

But research aside, what truly informs our choices when deciding to purchase a vehicle? Of course, research helps us to form a wish list and we all have our preferences of vehicle makes and models, but many of our decisions are ultimately driven by budget and a desire to get the best return on our investment. Taking this position, more prospective buyers than ever find themselves considering pre-owned vehicles, rather than buying brand new.

Whether you prefer the term ‘pre-owned’ to ‘used’ boils down to semantics. The simple truth is that previously-owned vehicles are held to a far higher standard than they were in the past. Offering higher value, better features, and assurance of longevity, the growing popularity of buying pre-owned is really no surprise. With that in mind, let’s take a closer look at some of the reasons why buying pre-owned might be the best choice for you

Depreciation

Of all arguments in favor of buying pre-owned, depreciation rates among those that top the list. Simply put, a vehicle experiences the most depreciation during the first 3-5 years of its ownership. With each year, the rate of depreciation slows significantly, meaning that a second-owner sees less decrease in value along with their relationship with the vehicle. Simple enough, right? Well, let’s attach some hard numbers to depreciation, in order to put it more clearly into perspective.

To begin, let’s say you buy a new vehicle for $30,000. We’ve all heard the old adage that a vehicle loses value the moment that you drive it off the dealer lot, but do you realize just how much value it loses. Before the rear tires have even touched the street, that vehicle has lost up to 11% of its value. This means that if you were to turn right around, pull back into the dealership, and try to re-sell it to the dealer, they might only obligated to offer you $27,000 for the vehicle you just bought.

After just one year of ownership, that vehicle will have lost up to 25% of its value. After three years, it is worth about 46% less than what you paid for it. And after five years, the vehicle may have decreased in value by as much as 63%.

For the original owner, this means that 3-5 years of ownership will have left them with a vehicle valued somewhere between $11,000 – $16,000 at best. It goes without saying that they are unlikely to fetch anywhere near that in trade-in value, but what it does do, is empower that next vehicle’s owner to get more vehicle for their money.

Simply by choosing a three-year-old vehicle, a buyer might now afford a make, model or trim level which (if bought new) would be well outside their price range, and could do so with money to spare.

In addition, they would enjoy a slower rate of depreciation on that vehicle, guaranteeing them a better return on their investment, in the form of trade-in value against their next vehicle purchase. This is one of the major reasons why many utilize a well-researched pre-owned vehicle purchase as a stepping stone towards more aspirational car-buying.

Longer Life

Contrary to popular belief, there is surprising evidence behind the argument that a well-maintained vehicle might last longer than ever. These days we tend to criticize everything as being made to be disposable, but today’s vehicles are often meeting (or even exceeding) 250,000 miles in their lifetime.

Taking into consideration that 12,000 miles is considered to be the norm in terms of annual mileage this assures longevity. Even a five-year-old vehicle, properly maintained by its original owner, might only have 60,000 miles on it. This means that, with equal care, the second owner could enjoy a relationship with that vehicle that lasts twice as long, if not more. Granted, such an optimistic statement comes with certain expectations that the buyer has performed their due diligence on the front-end, but such a strong return is largely possible.

Lower Front-End & Incremental Costs

Any car purchase comes with additional expense, be it sales tax, title, registration or insurance. But the decision to buy a used vehicle reduces (and sometimes eliminates) some of these costs. Assuming that someone buying pre-owned understands the fiscal strength of their decision, this only adds fuel to the proverbial fire of their choice.

Certified Pre-Owned

CPO Programs provide another level of assurance in any decision to buy pre-owned. The distinction between a used and CPO vehicle is that the latter meets certain criteria which makes it eligible for extended warranty coverage by the automaker themselves. CPO programs differ between automakers but can include both powertrain and bumper-to-bumper coverage.

Such eligibility is normally determined based on a few reassuring factors. For example, a Ford must have (i) been produced within the last six model years (ii) have fewer than 80,000 miles (iii) have a clean CarFAX vehicle history report and (iv) pass a 172 point inspection to be eligible for Ford CPO status. This alone provides assurance of reliability, but a 7-Year / 100,000-Mile Powertrain and 12-Month / 12,000-Mile Limited Warranty make it even more appealing.

Is Buying Used Right for You?

Probably. Ultimately, the choice is yours, but it’s important to understand that a pre-owned vehicle isn’t a consolation prize; properly researched, it represents a wise investment…and who doesn’t like that?