When you buy a used vehicle, it means a large investment, usually of thousands of dollars. Used cars are generally less expensive than new cars but it’s still a costly venture that requires you to take out a used car loan. Thus, it would be in your best interest to learn what determines the price of a vehicle. Sure, you can get a good idea how much the vehicle you’re looking at is valued by checking out the Kelley Blue Book but it should not be the only thing. You should always consider other factors.
Several Factors That Determine A Vehicle’s Worth
Factor 1 – Age
Most people tend to look at the vehicle’s age when they’re looking for a car to buy. Older vehicles tend to be less in price but they also have a significant past. An older vehicle that doesn’t have a lot of miles on it would seem not to have a lot of stress on it but that’s not true. Simple fatigue can hit after so many years. If you based the car’s value on age, then it just reflects that the older the vehicle is, the more prone to problems it’s likely to have. It’s also harder to get replacement parts for older vehicles.
Factor 2 – Mileage
Another big factor that determines a used vehicle’s value is its mileage. If the vehicle has high mileage, it’s gotten more use and wear and tear. Thus, the vehicle’s value will be lower. Once a mileage threshold has been reached, regardless of the vehicle’s age, it’s older than its actual years.
Factor 3 – Vehicle Make/Model
Believe it or not, but a vehicle’s make and model will have a tremendous impact on the value. Certain vehicles are already expensive to start with, which means they’ll be higher priced. Popular cars, not-so popular cars and preferences will also play a role in the value of a car. The value for a used car that’s popular is always going to be more than the value of a not-so popular vehicle, despite being similar in other ways.
Factor 4 – Warranty
A person can purchase a used vehicle several ways such as a private seller or a used vehicle dealership. If a person is buying privately, the vehicle is typically sold “as is”, meaning if anything goes wrong… you eat the costs to pay for it! However, a vehicle that’s been sold through a used car dealership may have some kind of warranty still on it. A used car dealership is more likely to determine a car’s value than a private seller would.
Thanks to the lemon laws, there is some added protection to buying used vehicles. These laws tend to affect used car dealerships, making the dealership honor any warranty it offers. Should something go wrong and the warranty covers it, the dealership must do one of three things:
– Replace the defected part
– Repair the vehicle
– Refund the buyer’s money
This does give the buyer some guarantee in the event the car isn’t reliable but it does affect its value too. Most consumers, however, consider paying a little more for a used vehicle is worth it if the vehicle proves its dependability and reliability.