In this day and age, buying a new car is often seen as a financial risk that is just not worth taking. Getting a loan can be pretty difficult due to the lending institutions closing the stable door after the horse has bolted, and the price of new cars makes them hard to buy without borrowing. So it is no surprise that a lot of people who are on the borderline between buying new and buying second hand are plumping for the latter. But is this a false economy?

Borrowing to buy a new car has one definite advantage over borrowing to buy a second-hand car. The fact of the matter is that you will have to pay a higher rate of interest for a second hand car for a number of reasons, and if you have any way of getting a new car for a reasonable price it can work out heavily in your favor. The re-sale value of it is likely to be considerably higher, for one thing.

But the question of whether you are better going for new or used really is not one that can be answered definitively without a lot of secondary questions being asked. A lot depends on the purpose of your purchase – if you are planning on using it a lot, then the car’s history has to be taken into account for a start. Going through a checklist of what matters most to you is advisable before making any purchase.