Buy used or New?

For the guys buying used and running them into the ground, don’t forget that you will get nothing back when that vehicle is done. Today’s vehicles are nearly maintenance free up to 100-150k miles. Besides the obvious brakes, oil and filter changes of course. Buying used and running them into the ground means you’ll have those scheduled maintenance costs like tranny oil, transfer case oil, radiator fluid, front and rear end oil, wheel bearings, brakes, suspension, etc… then you get nothing when you’re done with it.

Unfortunately for the new vehicle guys the new vehicle prices have skyrocketed over the last decade. That means any equity you have in your purchase doesn’t go as far. If prices were stable and you maintain good equity in your vehicle, I can’t see how a used purchase makes any financial sense. If you can get to the point where you’re financing half or less of a new vehicle, I cant see buying used.

biggill wrote:

<div class=”d4p-bbt-quote-title”>Munchy wrote:</div>
That feeling you’re getting is from the value dropping 15% those first 500 feet. Did it once, don’t need to do it again.

That’s a myth. Keep in mind the vast majority of new vehicles purchased are financed. Why in the hell would a bank finance something for less than it’s worth? Unless there’s other collateral involved, banks wouldn’t do this.

Have you ever checked the value of a new vehicle after you bought it? I have. Both times I paid less than it was worth. Not only was this disclosed in the financing paperwork but I had checked the blue book value as well for several months following the purchase. Now I have an app on my phone giving my blue book value every time I enter mileage.

Unless you can get a discount or “deal” on a slightly used vehicle, it’s either usually a wash or it’s a better deal to buy new.

Banks finance more than a vehicle is worth because of your credit, and the way loans are structured they make their money on the initial payments where very little goes to the principal. New vehicles do lose a significant amount of value right away, that is why Gap Insurance exists and is often a good idea for anyone not putting money down. Kelley Blue Book is worthless imo, NADA is aggregated data from all dealers, auctions and online private sales. It is also what insurance companies use to determine your vehicle’s value in the event of a total loss.

biggill wrote:

For the guys buying used and running them into the ground, don’t forget that you will get nothing back when that vehicle is done.

If you paid pennies on the dollar to begin with it doesn’t matter…

Like someone else said the numbers don’t lie. Calculate vehicle cost, repairs or (payments and repair costs if you went new) then divide by the number of miles you drove. Simple.

Each to his own though. If you like new vehicles that’s great, just don’t try to say that it’s cheaper in the end. Cause it’s not true or possible. If a new vehicle is worth the extra cash to you that’s all that matters and drive that new vehicle proudly!

if you are financing, it makes sense to buy new. cash? its doesn’t.

getting 0% on a 50,000k vehicle as opposed to 3-4% on a few yr old vehicle that is 40000k is near negligible on a 72 mo loan. that 30-40 bucks a month might be worth it to someone to be driving a new car.

a vehicle for me is a tool and not a status symbol so it makes buying used a ton easier.

my mechanic has always said he’s not worried about mileage. since HS, every car i’ve bought has had around 100k miles on it. I’m 38 now and i’ve owned 3 vehicles since graduating HS (like the cars/trucks i drive). decent vehicles too. no jalopys. for my wife, I’ve bought my wife 2-3 yr old honda odyssey’s and have saved almost 20k from buying a 50k mile van as opposed to a new one.

fishinfreaks wrote:

For those that bought “slightly used”, I’d like to hear what you paid for price of your vehicle vs the cost of a new one. Say you bought a 2 year old vehicle with 30,000 miles. What’s the savings of the wear and tear (and unknown abuse) of that vehicle worth?

Tell us the deals you found.

Thanks.

3 year old truck, 35,000 miles, sticker of just over $45,000. Paid 29,000OTD…even if rebates brought the new price to $40,000, I wouldn’t pay 11k more for a new truck…

No matter what you decide, you’ll still get around 60% of the purchase price back after about 5-6 years when you buy slightly used or new. Some may be more, some less. The cost savings are seen when you buy 8-10 year old vehicles with around 100,000 miles…

I’m in a bit of a unique situation since my dad is retired from Ford, so I get employee pricing. It’s not as good of a deal as it used to be, but it seems like the employee price is typically about 1K less than a good negotiator could get on the same vehicle without the employee discount.

In 2013 I bought a new F150 for 30K. I drove it for 5 years and put on 90,000 miles. Earlier this year I traded in on a new 2018 F150 that has the same features as the last. They gave me 22K on trade in! That means I drove that truck for 8K over 5 years plus the tax benefit of the trade in on the new one. The only sucky part is the new truck was 9K more than the last one. 9K cost increase over 5 years is nuts, but I just couldn’t see the reason to buy a used one for what they ask for them.

To me, it seems slightly used prices are crazy high. I’m sure there are cases where it makes sense, but the prices are high enough that I think one really has to look at it carefully when making purchase.

I have a different reason to purchase new, tax deductions for self-employed. Depreciation is a write off, interest on loan and mileage. Need to buy new about every 4 years to get the best deductions. The wife…well she gets a used car.

Another thing that can add up is how many goodies you plan on having on your truck. When you buy new you are paying top dollar for new accessories. If you buy a few years used or more you can easily buy toppers, seat covers, floor mats, etc, etc for half price or much less. It does add up as well. The last two 1/2 ton trucks I bought were pretty bare bones on the model and features and bought new both times. Kept one 10 years, kept last one 4 years and I needed to get a heavy duty for a couple trailers I have now. There’s no way I was paying over 50K for a truck I only use to pull trailers a couple days a week so went used this round. I also have low miles because I drive a little commuter car to work 90% of the time. Anyway, traded in my 14′ w 36,000 miles for a great price towards a same year decked out 1 ton sticker was 55k, got for 31k and barely more miles than I had on my 150. It’s arguable whether or not higher model trims take the biggest beating on depreciation sometimes but all depends on the model and local market.

It depends on what’s available when I need to buy.

I drive them until they drop, so, unfortunately, this sometimes leads to a need to do emergency truck shopping on short notice. It can get hard to find low mileage used vehicles.

Also, you have to look very carefully at both used and new prices when you buy and then factor in finance costs. Since I’m assuming most people have to finance, this is becoming more relevant as interest rates creep upward again. When I bought my current SUV, we got .9% financing for 5 years. A casual look at the average used finance rates available showed that this was at least 5-6% lower than advertised market rates.

So it CAN make sense to buy new over used if the reduction in interest rates covers the price spread. I’ve done this twice, I got 0% once and .9% once. Easy decision then.

Grouse

to_setter wrote:

In 2013 I bought a new F150 for 30K. I drove it for 5 years and put on 90,000 miles. Earlier this year I traded in on a new 2018 F150 that has the same features as the last. They gave me 22K on trade in! That means I drove that truck for 8K over 5 years plus the tax benefit of the trade in on the new one. The only sucky part is the new truck was 9K more than the last one. 9K cost increase over 5 years is nuts, but I just couldn’t see the reason to buy a used one for what they ask for them.

EXACTLY my point. Thanks for posting factual numbers! Your situation isn’t unique because I bought a new F150 in 2010 for less than $27k. Then I bought new in 2015.

Just like others have noted there isn’t a single correct answer… For me I had always preferred to purchased a low mileage used vehicle, usually 1-2 years old. Just like Mike and other I will then keep it until the cost of maintenance/down time exceeds the value of not having a monthly payment. When I was last looking for a vehicle in 2013 my main criteria for a truck was that it had to be a full crew cab for having kids in the back seat & it needed a full 6.5′ box so that I could carry my Otter Lodge in it with the tailgate up. We also wanted leather seats with the kids knowing how much would be spilled. Surprisingly those specific criteria were pretty tough to find in a used truck with the best value I had found was a 2 year old truck with 40K miles for ~$40K. To get a new truck with the same specs and more features was $38K. I ended up with a brand new truck. (NOTE: In order to get that price I had to read the fine print and finance through Ford at a higher interested rate for a minimum of 90 days… As soon as those 90 days were up I refinanced at a low rate through my credit union.)

Like others have said though it always depends on the situation and the timing. I’m helping my mom to look at new smallish SUVs right now and based on my initial look it appears that used is the way to go for her; however, I won’t know for sure until we actually talk to a dealership and find out how they will handle her trade-in.

hnd wrote:

if you are financing, it makes sense to buy new. cash? its doesn’t.

getting 0% on a 50,000k vehicle as opposed to 3-4% on a few yr old vehicle that is 40000k is near negligible on a 72 mo loan. that 30-40 bucks a month might be worth it to someone to be driving a new car.

a vehicle for me is a tool and not a status symbol so it makes buying used a ton easier.

my mechanic has always said he’s not worried about mileage. since HS, every car i’ve bought has had around 100k miles on it. I’m 38 now and i’ve owned 3 vehicles since graduating HS (like the cars/trucks i drive). decent vehicles too. no jalopys. for my wife, I’ve bought my wife 2-3 yr old honda odyssey’s and have saved almost 20k from buying a 50k mile van as opposed to a new one.

^This

I will always drive the older 4×4 while the wife has a new or almost new suv of some sort. My vehicle pulls the boat, trailers, hauls lumber, hauls ice fishing gear, and gets me from point A to point B. The same goes for the couple vehicles that stay at our land down the road. They are tools, not symbols or for enjoyment.

It is also correct that buying in cash gets you absolutely nothing if going the “new” route. My parents just attempted to purchase a 2018 Jeep Grand Cherokee Limited with cash. The dealer scoffed at it and offered them a “better” deal to finance it for 2 years. My dad walked out the door and went across the street to buy a new GMC Yukon with cash as they were less objective to the idea. Their relationships are maintained by volume and transactions when it comes to lenders. There’s more for them to gain by having you finance (hence the incentives).

I have purchased every vehicle I’ve ever owned with cash (never new), while opting for new and financing with the wife’s. I keep my vehicles for 5+ years and run them to ~150k when the seemingly larger repairs become more frequent and sell them for cash. I don’t see myself changing this business model anytime soon. My wife and I have always agreed that she can upgrade whenever she has 1/4 of the asking price to put down. I match her other 1/4 and we finance exactly half of the new vehicle. We are far from wealthy, but this has always kept us with a fully warrantied vehicle that we pay off in a couple years. She then gets the “keeping up with the jones’s” syndrome and we go through the same process again 3 years later. We are a typical middle-class couple with no kids, and this cycle has worked well for the near decade that we’ve known each other.

Will Roseberg wrote:

To get a new truck with the same specs and more features was $38K. I ended up with a brand new truck. (NOTE: In order to get that price I had to read the fine print and finance through Ford at a higher interested rate for a minimum of 90 days… As soon as those 90 days were up I refinanced at a low rate through my credit union.)

Will, I did the exact same thing. Although, I think of the $1000 savings I paid about $700 back in interest.

Will Roseberg wrote:

When I was last looking for a vehicle in 2013 my main criteria for a truck was that it had to be a full crew cab for having kids in the back seat & it needed a full 6.5′ box so that I could carry my Otter Lodge in it with the tailgate up. We also wanted leather seats with the kids knowing how much would be spilled.

What did you end up going with? Once we (hopefully) add child #3 in the next 1-2 years, I would like to upgrade my quad cab/6.5 box to a crew cab/6.5 box for basically the exact same reasons that you also want the crew/6.5. I really haven’t started much research into it yet… Currently have a 2013 Ram 1500 that I bought new and I love, but just need the crew cab now.

biggill wrote:

<div class=”d4p-bbt-quote-title”>Will Roseberg wrote:</div>
To get a new truck with the same specs and more features was $38K. I ended up with a brand new truck. (NOTE: In order to get that price I had to read the fine print and finance through Ford at a higher interested rate for a minimum of 90 days… As soon as those 90 days were up I refinanced at a low rate through my credit union.)

Will, I did the exact same thing. Although, I think of the $1000 savings I paid about $700 back in interest.

X3. I there were like 11K in rebates in 2013 with the only downside being the Ford finance thing. Refinance after the 90 days, and good go though!

mnrabbit wrote:

<div class=”d4p-bbt-quote-title”>Will Roseberg wrote:</div>
When I was last looking for a vehicle in 2013 my main criteria for a truck was that it had to be a full crew cab for having kids in the back seat & it needed a full 6.5′ box so that I could carry my Otter Lodge in it with the tailgate up. We also wanted leather seats with the kids knowing how much would be spilled.

What did you end up going with? Once we (hopefully) add child #3 in the next 1-2 years, I would like to upgrade my quad cab/6.5 box to a crew cab/6.5 box for basically the exact same reasons that you also want the crew/6.5. I really haven’t started much research into it yet… Currently have a 2013 Ram 1500 that I bought new and I love, but just need the crew cab now.

I went with a Ford F150 based mostly on price. Ford’s bed is also a true 6.5′ where the Chevy and the Dodge were a few inches shorter I believe.

btw, next year i’m going to be buying a new truck. i’ve had my 2000 silverado for 7 years and have put 70k miles on it (at 180k miles). I’ve been finding 2006-2010 f150’s (not buying another GM just want to try a ford) in the 100k-120k mile range for around 10-13 grand. i’m looking 4 door. guys don’t understand why i don’t look for better more expensive vehicles but my track record is pretty good with these vehicles and i usually turn around and sell them for a few grand.

if im not mistaken that year range is when ford had some trouble with spark plugs breaking off on the motors and causing expensive repairs. someone with more knowledge on the matter can chime in and correct me if im wrong but if correct, that may explain why you are finding them cheap.

crappie55369 wrote:

if im not mistaken that year range is when ford had some trouble with spark plugs breaking off on the motors and causing expensive repairs. someone with more knowledge on the matter can chime in and correct me if im wrong but if correct, that may explain why you are finding them cheap.

I’ve got an ’05 with the 3-valve, and while it’s actually been a good motor with plenty of power for pulling the wheelhouse, the first plug change (I bought it with 84k on it, at 135k now) was a bear and I am definitely going to be dumping it before I need to change them again. I would stick with something newer than ’08, as thats when they changed the design to eliminate this problem. Other than that however, its been an awesome truck.

What about new vs. used for campers/trailers? Seems like the deprecation on them is huge so makes sense to go used. No experience though so interested in what you all think.

I have found that if you are willing to go with cloth seats, used trucks are still a good value. There are some great, great deals on trucks with cloth because they are simply in less demand. But for me, with as long as I keep my vehicles for, I wanted the easy cleaning of leather. Especially in a truck where I am often dirty when getting in.

Kirk Eisele wrote:

What about new vs. used for campers/trailers? Seems like the deprecation on them is huge so makes sense to go used. No experience though so interested in what you all think.

If you’re looking at pickup campers, used ones for 3/4 and 1 tons go for cheap. Like super cheap. Makes me wish I had a HD truck.

crappie55369 wrote:

if im not mistaken that year range is when ford had some trouble with spark plugs breaking off on the motors and causing expensive repairs. someone with more knowledge on the matter can chime in and correct me if im wrong but if correct, that may explain why you are finding them cheap.

Fords spark plug issues started in ‘97 or ‘98 I believe. I had a ‘99 and had 2 plugs blow out. $300 fix each time.

I’d like to know where you guys are finding a couple year old truck that is a big discount from new. Every time I shop I find that a 2 year old comparable truck is within 20% of new.
For that 20%, I’ll take new.

Just for kicks I did a quick search of AV Ford, since they list their prices easy.

New 2018 XLT 2.7 Eccoboost supercrew – $39,283
2016 XLT 2.7 Eccoboost supercrew, 15k miles, $34,499

That is only a 12% savings going used. Kind of breaks the theory that you lose 15% driving off the lot.
Excluding repairs, if you keep them to the same age there is a 5% difference in price on a per year cost.
Cost per year (excluding repairs) to keep the new one for 13 years is $3,021.77/year.
Cost per year (excluding repairs) to keep the used one for 11 years is $2,874.92/year.

I’ll take new and own it for two extra years for the 5% premium.

Ford’s 2V heads that they used through 03 had issues. The 04 and newer 3V heads were a very good head with a bad spark design, I don’t think you can even buy those anymore. The only issue with the plug was when you went to remove them and it is only an issue if you don’t follow the correct procedure. Not many trucks out there with the factory plugs anymore so even backyard mechanics can manage a plug change without issues.

hnd wrote:

btw, next year i’m going to be buying a new truck. i’ve had my 2000 silverado for 7 years and have put 70k miles on it (at 180k miles). I’ve been finding 2006-2010 f150’s (not buying another GM just want to try a ford) in the 100k-120k mile range for around 10-13 grand. i’m looking 4 door. guys don’t understand why i don’t look for better more expensive vehicles but my track record is pretty good with these vehicles and i usually turn around and sell them for a few grand.

I would think twice before buying a 5.4…I would also think twice about buying the first few AFM years of Chevy (08-10ish)…you will severely regret both decisions eventually. Waiting for someone to chime in about how they have 2.3 million miles on one of these motors and it’s still on it’s first oil change…facts don’t like, neither are very reliable. Some people just get lucky…

In 2000 about the time that the 2001 model were coming out I bought a bottom of the line fleet Silverado. 4 wheel drive, manual transmission, AC, radio/cassette player, 8ft box, 4.8L V8, rubber floor mats. for just under $20,000. I added matching quality fiberglass topper and bed liner for about $2000. I financed the truck with the dealer, I can’t remember what the payment were, but it has been 13 years since I had to make one.

When I bought the truck, I lived in MO. It was our second vehicle and I drove it to work on a daily basis. My job entailed a fair amount of travel, so, many Monday mornings it went to the airport and sat in a parking lot for 5 to 12 days.

Fast forawrd, it now has 149k miles on it. In 2010 I retired to a lake home in North Central MN. I still drive that same truck as second vehicle. My wife always gets the new SUV.

I have a mechanic I trust in Pine River. I expect this truck probably has another 50K miles in it.

I have kept the truck up both inside and out. My policy is I can spend UP TO $2000 a year on the truck fixing things, buying tires, wiper blades, repairing or replacing body panels (it has little or no visible rust), and be lots of money ahead of the cost of buying a new or late model used truck.

I will probably drive it another 6 years. Over the life of the vehicle I will have spent less than $3000 a year. My wife and I buy new and keep for what most people would call forever.

Just for kicks I did a quick search of AV Ford, since they list their prices easy.

New 2018 XLT 2.7 Eccoboost supercrew – $39,283
2016 XLT 2.7 Eccoboost supercrew, 15k miles, $34,499

I did a lot of shopping and research before I found my truck. Almost a year of looking for that deal. Then when I finally found it I jumped on it.

crappie55369 wrote:

if im not mistaken that year range is when ford had some trouble with spark plugs breaking off on the motors and causing expensive repairs. someone with more knowledge on the matter can chime in and correct me if im wrong but if correct, that may explain why you are finding them cheap.

i’m finding chevy’s dodge’s with same mileage in the same price range so its not a ford thing. i just want a ford this go around. and i’ve done the spark plug change on buddies in this time year twice with no issue.

404 ERROR wrote:

<div class=”d4p-bbt-quote-title”>hnd wrote:</div>
btw, next year i’m going to be buying a new truck. i’ve had my 2000 silverado for 7 years and have put 70k miles on it (at 180k miles). I’ve been finding 2006-2010 f150’s (not buying another GM just want to try a ford) in the 100k-120k mile range for around 10-13 grand. i’m looking 4 door. guys don’t understand why i don’t look for better more expensive vehicles but my track record is pretty good with these vehicles and i usually turn around and sell them for a few grand.

I would think twice before buying a 5.4…I would also think twice about buying the first few AFM years of Chevy (08-10ish)…you will severely regret both decisions eventually. Waiting for someone to chime in about how they have 2.3 million miles on one of these motors and it’s still on it’s first oil change…facts don’t like, neither are very reliable. Some people just get lucky…

i’ve been told to think twice about buying a ford. i’ve been told to think twice about buying a dodge, i’ve been told to think twice before buying a chevy. They all have issues and quirks. effectively these 3 companies have perfected the truck to some extent. I’m just trying to buy the first year of a body style or the 1st year of a major motor change, and i’ve always had decent luck.

that said i won’t be buying a dodge…ever again.