Useful tips to consider when buying a used car.
South Africa’s car market is expanding due to increasing reliance on vehicles. This presents opportunities for great deals on used cars. When shopping for a second-hand vehicle, keep these tips in mind to minimise future headaches.
Start by creating a budget to determine the affordability and price range of your new wheels. Depending on specific parameters, you may need to consider a pre-owned vehicle. Remember to account for expenses beyond monthly instalments, such as car insurance, fuel costs, toll fees, maintenance expenses, and potential future interest rate increases.
It’s rare to purchase a vehicle outright with cash, so obtaining finance from a bank is often the alternative. Financial institutions consider your credit history as a crucial factor when deciding whether to grant a car loan.
New graduates who have recently entered the workforce and started paying their own bills may need to gain experience before being eligible for vehicle finance. Different manufacturers in the South African market may offer special finance deals for first-time buyers, but thorough research is advised before committing. Always read and fully understand the terms and conditions to avoid any future confusion.
Additional tips to keep in mind:
- Prioritise purchasing the vehicle you need rather than the one you desire but can’t afford. If you’re financially strained, opt for affordable, fuel-efficient vehicles instead of popular SUVs. This decision will prove beneficial every time you have to refill your tank after a fuel price hike.
- Look for used vehicles that come with a warranty. If possible, try to extend the warranty and maintenance plan. If a warranty is unavailable, ensure the vehicle has a full-service history (FSH) to reduce the risk of breakdowns caused by inadequate maintenance.
- For vehicles without a warranty or service plan, find a reliable workshop for inspections and maintenance. Access to a mechanic is crucial in case of unforeseen breakdowns.
- Avoid purchasing vehicles that have been previously damaged and repaired, unless a reputable panel beater has restored an accident-damaged vehicle to roadworthy condition. Stick to vehicles with clean titles, as anything too good to be true probably is.
- Be cautious of scam postings on listings platforms offering enticing prices on new vehicles. Take your time during the purchase process to avoid being deceived and ensure you find the best vehicle.
- Arrange a test drive for the used vehicle to identify any faults or issues that need to be addressed. This helps determine if the vehicle suits your needs and provides an opportunity to negotiate the price with the seller.
- Beware of balloon payments, which may initially offer lower monthly repayments but ultimately leave you with a substantial outstanding amount at the end of the loan period. Make sure the value of your vehicle will cover this balance when you trade it in or sell it for a new one.
- Car insurance should be included in your car budget, despite it being an unpopular expense. In the event of an accident resulting in a write-off, you will still need to repay the car. Insurance also protects against potential third-party claims.
We give attribution to this article from the original source: Carmag