Financing Used vs. Financing New

The choice of whether to purchase a new or used car depends on a few factors - for example, your lifestyle, budget, and the matter of Subaru financing. In fact, there are several differences between financing a used car and financing a new one, and Gillman Subaru San Antonio can help you decide which option is best for you.

Interest Rates

New cars usually offer lower interest rates, since they're considered to be lower-risk investments. On the other hand, used cars typically have higher interest rates. This makes sense when you consider that it's harder to value the condition and potential depreciation of a car that already has plenty of miles on it, versus a vehicle that's brand-new.

Loan Terms

If you buy a new Subaru SUV, chances are you'll be privy to longer loan terms (e.g., 72 months) and lower monthly payments. The loan terms for a used car aren't drastically different, but you should expect to have a shorter loan term (e.g., 60 months) with higher monthly payments. The difference is directly related to interest rates - which incidentally also impact the number of financing options you'll have. New cars often have more financing options than used cars.

Depreciation

Depreciation represents the biggest downside to buying a new car. In the first year of ownership, the average new car will lose up to 20% of its value. Contrarily, a used car will have already experienced this value hit and could thus be considered a more stable investment.

Warranty and Maintenance

Every new car in our showroom comes with a three-year basic warranty and a five-year powertrain warranty. Meanwhile, a used car buyer gets only what remains of these warranties, along with the option to purchase an extended warranty. Regarding maintenance, used cars typically cost more to maintain due to their advanced age and mileage.

Get Competitive Subaru Financing in San Antonio, TX Today

The decision of whether to finance a new car or a used one depends on several things, such as your credit score, priorities, and budget. It's a decision not to be taken lightly, and the financing experts at our San Antonio, TX Subaru dealership are ready to help you explore both options and make the right choice.