The used car market in India is estimated to grow at a healthy rate for the next five years. The rise in India’s young population, the convenience of buying used cars, and simplicity in transactions are some of the many reasons contributing to the growth in purchasing used cars.
Moreover, the rise in disposable income and frequent launch of new models has decreased the average tenure of car ownership. Additionally, you can easily avail of a used car loanat attractive interest rates discussed later in this post.
7 Benefits of Purchasing a Used Car
1. Affordable Price
The price difference is the biggest point tilting the odds in favour of used cars in the new car vs used car debate. A used car can cost you much lesser than a brand-new car.
Moreover, ever since the National Green Tribunal banned the use of petrol cars that are more than 15 years old and diesel cars older than 10 years in many states like Delhi, new car owners are selling cars more frequently, creating a huge supply in the second-hand market.
Depending on the deal you strike, you can get an unbelievably good deal on a barely used car. Many car dealers can help you strike a good deal.
2. Take Advantage of Depreciation
A car is a depreciating asset. A brand-new car’s value depreciates immediately by 5% the moment you drive it out of the showroom. In the next 6 months, it depreciates by 10%. In fact, a new car can lose up to 30% of its value in depreciation within the first two years of ownership.
Therefore, the original owner typically bears a significant portion of the depreciation. Consequently, you can get your hands on a good used car at an affordable rate.
3. Good for Novice Drivers
If you’ve recently learnt to drive, then you might not have yet fully developed your driving reflexes. This is because you are still learning to apply brakes, accelerate the vehicle, park the car, change gears, manoeuvre through traffic, etc. As a result, you may be more prone to cause accidents or damage to the vehicle. Besides, the damage to a new car hurts more than that to a used car.
So, between the new car vs used caroptions, a new driver should consider opting for a used car for all practical reasons.
4. Low Insurance Premium
Whether you buy a new or an old car, you must purchase at least third-party insurance cover, which is a statutory obligation. However, comprehensive car insurance can provide more wholesome coverage as it covers both third-party liabilities and own damage to the insured vehicle.
The insurance premium amount usually goes down as the car’s value depreciates over time. So, you’re likely to pay a lower insurance premium on a used car.
5. Tried and Tested Technology
When you buy a used car, you’re also ensuring that the car is tried and tested. New models with new engines might have troubles.
Besides, if you compare a new car vs an old car based on technology improvement, then a 2-3 years old used car is unlikely to have a significant technology lag compared to the latest model of that same car. So, you’re likely to get standard safety features, decent interiors, and utility features even in an older version of a car model.
Many authorised second-hand car dealers sell certified pre-owned cars. These cars are sold after a thorough background check, ownership history, and a clear assessment of the machine parts. These cars can come with a warranty to reassure the buyer of their quality.
7. Used Car Loan
Gone are the days when taking a loan to buy a used car would be very expensive. With lenders like Tata Capital providing second-hand car loanat affordable rates, things have changed drastically.
While the new car loan interest rates are still lower than the used car loan interest rates,the gap is closing.
Besides, the other advantages make up for it.
Now you can get a used car loan for up to 95% of the car’s value for flexible tenure ranging between 12 months to 72 months. From budget-friendly models to luxury cars, you can easily select a used car loan to purchase your dream car.
Getting a loan has become easier too. Just visit the official website of the second-hand car loan provider and check the eligibility and documentation criteria. Next, enquire about their online car loan approval process and the used car loan interest rates on offer. Most lenders today have a quick online car loan approval process to facilitate hassle-free disbursement of a used car loan.
There might not be a clear winner in the new car vs used car debate. However, purchasing a used car can have clear benefits, as discussed above. With lenders like Tata Capital offering lucrative used car loan interest rates, you can go ahead and bring home a second-hand car if you find one at a reasonable price and in good condition.