Is buying a new car at 0% APR better than buying a used car at 3% APR?

Is financing a new or used car better? I don't know whether I should buy a new or used car. The dealer near me is offering 0% APR for new cars, but I also got approved for 3% APR on a used car.

Answer provided by
Eric Schad
Answered on Jul 16, 2021
Eric Schad has been a freelance writer for nearly a decade, as well as an SEO specialist and editor for the past five years. Before getting behind the keyboard, he worked in the finance and music industries (the perfect combo). With a wide array of professional and personal experiences, he’s developed a knack for tone and branding across many different verticals. Away from the computer, Schad is a blues guitar shredder, crazed sports fan, and always down for a spontaneous trip anywhere around the globe.
“This is highly dependent on the price of the cars and your budget.
Think about it like this. If you buy a $25,000 new car with 0% APR for 60 months, your monthly payment is $417.
But if you buy a used car for $15,000 and 3% APR for 60 months, your monthly car note is $270.
So it’s all in the eye of the beholder. If you can get a quality vehicle for $15,000, why would you pay more? Is it for status? Or just a preference?
There’s no wrong answer, but making out a spreadsheet of your budget may help.”

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