In today's turbulent economy, you need to be able to stretch every dollar you earn as far as you can, especially when it comes to those significant large purchases that all of us have to do make from time to time, like cars.
In order to get the most out of their investment, buying trends are starting to shift away from the latest releases from the major auto manufacturers and beginning to shift towards used cars more than ever before.
The reasoning behind this may vary from person to person but there are some definite truths emerging from it that we can easily identify.
Credit Standards With all the economic turmoil of the last few years, a lot of us have had our credit scores lowered through no fault of our own.
The major reporting agencies are not at fault but rather the rules have changed, with a lot of creditors without bothering to let us know what is happening.
Now, some companies consider your payments to be late if they have been received within twenty-four hours of the due date, and rising interest rates have done nothing but stymie all attempts at lowering balances.
All of the changes have resulted in our credit reports becoming more negative, and there is not a lot of financing to be had any more.
Just like the rules have changed for open credit accounts, getting new credit is even harder than before.
The standards have been raised and they are quite tough to meet, even if your credit had been excellent in the past.
This means less mortgages are being issued, one crucial element needed to stimulate the economy, as are new car loans, something that a lot of people counted on to get the recovery rolling.
This is making purchasing used cars preferable, due in part to a more relaxed atmosphere of financing availability.
Quality The unstable economy has also led to some developments in the production of newer cars.
Because profit is key more than ever before, some models seem to hit the road a lot faster than ever before, and without a sterling quality record to back them up.
When you take into account the higher interest rates leading to higher payments for new cars, even with repayment guarantees from some of the major players, the amount of money a buyer has to invest in keeping some models running is just not worth it.
Especially since manufacturer's warranties have also been affected by the economic slump.
By comparison, older models made before the decline have a higher rating of reliability, meaning less of an investment in repair costs to go with the more affordable payments that are available.
Some brands still carry along their reputation for quality, even in the older models.
Not all brands make the six o'clock news due to safety issues, and traditional standards are still being met, especially in foreign makes and models.
Realistically, when you purchase a new car from any manufacturer, you lose up to 50% of its resale value the second the wheels hit the road.
But, by buying a highly regarded older model, like Ford Mustang's, Chevy truck's, Volvo wagon's, or BMV sport coupe's, you get affordable, reliable, transportation for a fair market value, backed by manufacturer integrity.
Flexible Financing Options With the job market in flux, traditional financing may not be attainable from all lenders, at least not without a significant initial deposit when purchasing new models.
When looking to finance used cars, the market seems to be a bit more flexible.
Many dealers offer low deposits and lower payments along with a wider range of options that include lowering your payment even further by extending the life of the loan.
Combine this with more dealers offering significant warranties on the cars they sell, most of which are no older than five to seven years beyond the current models, purchasing your next car in this manner is a truly affordable way to have excellent transportation, for less.