When it’s time to buy a car, you have a few choices. You can buy a new car, you can buy a used BMW or other car or you can lease a car. There are advantages and disadvantages to both that you need to keep in mind when making your decision.
Buying a new car has one big advantage — you get a brand new car that no one has ever used before. Another huge advantage to buying new is that you get a car with a warranty that will cover the entire car for the next 36,000-60,000 miles, depending on the brand, and engine components for 70,000-100,000 miles. That means that if something mechanical goes wrong, you won’t wind up paying for it. Of course, the big disadvantage to buying a new car is the price. New cars are expensive, and they also depreciate the minute you drive them off the auto dealership lot. New cars tend to depreciate about 20-30% in the first year, and by the time you pay off your purchase, your car likely will be worth less than half of what you paid for it.
If you want many of the benefits of buying a new car, without committing to a depreciating asset, you can lease a car instead. One of the biggest benefits of leasing is that you can get a brand new car for a much lower monthly payment than what it would cost you to buy it. Another advantage to leasing is that you have warranty coverage for the entire time you have the car, which means you should never have to spend any money on repairs. A huge disadvantage to leasing is that you are essentially spending thousands of dollars to rent a car, and you have no asset once your lease is over.
Many people are finding that the third option is the one for them. There were more than 38 million used cars sold in 2015, the highest number in eight years. Whether you are buying a used BMW, used Nissan or some other car brand, buying used has some benefits. Buying a used car is cheaper and it can allow you to afford options, such as leather seats and a sun roof, that you might otherwise have not been able to. Thanks to the popularity of leasing these days, you can get plenty of used BMWs and other used cars for sale that are almost new. In 2015, more than half the used cars were three years old or younger. The biggest drawback to buying used is that you don’t know the history of the car and often don’t have any kind of a warranty to provide any protection.
There are pros and cons to buying new, leasing and buying used. You have to weigh the benefits of each and balance that with your personal preferences to make the decision that is right for you.