Should You Fix Up or Trade Your Car?

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Man with wrench standing in front of older car
The Fix or Trade Dilemma
Do you have a high mileage car that is over ten years old? Do you worry about high priced repair bills? Does your old car break down often, leaving you stranded and late for work? There comes a time in every car owner's life when they have to make the decision to fix or trade their vehicle. Trading in for a new car would be awesome but it's not always the best decision. After all, if you own your present car outright, you don't have any monthly car payments. But if your car is breaking down all the time, that new car option starts to look pretty good.

There are pros and cons to both the option to repair your current car as well as to trade it in on a new car, or a car that is new to you. Let Lithia Motors help. With over 50 years of experience in the personal transportation business and over 265 quality car dealers from coast to coast in America and Canada, this is not our first rodeo when talking about the option to fix or trade. Let's take a look at all the options so you can make the right choice for you.

Repair Costs on your old car

If you have over 100,000 miles on your present car, or it is over ten years old, there are certain parts and components that wear out over time. At some point you have to replace things such as the timing belt, various hoses, maybe the engine gaskets, brake rotors, shocks and struts, water pump, even the radiator. These kinds of repairs aren't cheap but they don't necessarily make you want to throw in the towel on ol' Bessie. We're talking about repairs that generally cost anywhere from $500 to $1,000

Even if you have taken really good care of your car and followed the automaker's maintenance procedures for oil changes and service, vehicles have parts that wear out over time.
Today's vehicles last longer and require less repair than cars from the 1950's to the 1990s. In fact, more Americans are keeping their cars longer because the average car can easily go 200,000 miles and last 20 years without any catastrophic failures. The big ticket items are things like a new motor or transmission. Car dealerships might charge anywhere from $4,000 to $8,000 to replace such costly components, and for most people, spending that kind of money on a car that is having a lot of problems signals that it is time to unload that car for a new one.

Why Fix it Up?

Let's consider the reasons for keeping your old car and fixing it up. First up is that buying a new car right now might not be on the table for you. For one thing, a lack of automobile building materials such as high tech chips used in onboard computers, steel, and even the foam for car seats are in short supply. This has caused manufacturers to build fewer cars. The lack of having lots of new cars to choose from at dealerships has led to a push to sell used cars. Demand has caused there to be a lack of quality used cars in the marketplace as well. So keeping your old car starts to sound like a good option.
When new and used cars at dealerships are going for top dollar, you have to look at your budget to see if you can afford the down payment, the monthly payment and higher insurance and registration rates on a new vehicle. For all those reasons, it is almost always cheaper to repair your old car than to buy a new one these days.
Imagine the worst thing that can happen. Let's say your car blows its motor. Even replacing the motor at a cost of $4,000 might be less expensive than coming up with the down payment for a new car. Then you still have monthly payments to deal with. Plus, that new motor will come with a warranty and probably last at least another 150,000 miles.
Keep in mind that when you buy a new car, it will depreciate. It is estimated that a new car loses 22 percent of its value in the first year. You could take the money it would cost to replace that motor and purchase a used car that is new to you, but you have no guarantee that it won't break down or have its own list of maladies. At least a used car has already depreciated the most it will over the first three years on the road. Another reason to fix up your present car is that you can get a few more years of service out of it and by then the new car market may have changed in your favor. Repairing your car will keep you on the road and keep you from making any hasty decisions over getting a new car.
Think of it this way: if your car is paid off and you get stuck with a $1,500 repair bill, that's the equivalent of making three or four months of car payments on a newer car, depending on your monthly payment amount. Seems like a no brainer to make the repairs and keep the car.

Why Buy Instead of Repair?

Okay, now on the other side of the coin, we have the proposition to trade in your worrisome old car for a shiny new one. Perhaps you made a blood oath that you'd never spend another penny repairing that rust bucket that has become the Bain of your existence. Maybe you are sick and tired of the breakdowns and of being stranded and you know that a new car comes with excellent auto warranties for the overall car, the motor, some even come with free maintenance for the first three years.
It is impossible to predict when your old car will break down and what will need to be replaced next. Old cars become unpredictable, and you are always worried about when the nest breakdown will occur and if it will leave you stranded. You can have your mechanic create a list of items that will need to be replaced in the next two years, but that just makes you depressed as does frequent trips to the repair shop.
After all, a new car is A NEW CAR! All of the components are new and made to last longer than a car made ten years ago. Even if you have a problem, it is likely covered under your warranty. The dealership even offers loaners cars while they repair yours. Buying new is starting to sound pretty tempting. If a new car is not in your budget right now, purchasing a certified pre-owned car is very much like buying a new car as it has to pass a very detailed inspection and comes with a warranty to offer you that new car promise, namely peace of mind.
Another reason to buy a new car is that it comes equipped with the latest infotainment features as well as advanced safety and driver assist technology to keep you and your family safe. Your old car can't compete with such state-of-the-art tech as adaptive cruise control, automatic emergency braking, lane keep assist, and blind-spot monitoring. At the end of the day, you have to decide if your old car is stressing you out enough to say sayonara over all of her weird rattles, check engine error lights, inconsistent switches and devices that only work when they want to, like that one electric window that only goes all the way up occasionally.

Decisions, Decisions…
To recap, when considering fixing or trading in your car, think about these factors:
Fixing your car:
  • You already know the history of your car, its strengths and weaknesses.
  • Getting your car repaired is quicker and probably cheaper than doing the research, shopping for, and buying a new vehicle.
  • There's no change to your car insurance or registration costs.
  • If your car is paid for, the repair costs per year will likely be less than your monthly payment costs per year.
Buying a newer car:
  • Newer cars are more reliable and don't break down.
  • Newer cars generally get better gas mileage.
  • Newer cars come with bumper to bumper warranties and sometimes even free maintenance.Newer cars have advanced safety and driver assist features.

Let Lithia Help!
The time may have come to look at your budget, find out what your car is worth in trade by using our Lithia Motors online estimate tool and get a free appraisal on ol' Bessie from your local Lithia Auto dealer. If repairs to your old car will cost you more than half of its value, it is probably time to come see us. Ask our trained experts about rebates and cash incentives that might make the decision to buy a new or like new vehicle the way to go.
A new car, truck or SUV can bring peace of mind, and that, my friends, is priceless. You'll find the Lithia Auto dealership near you right here.