Buying a car is either a daunting or a delightful experience – depending on your affinity for vehicles and, of course, your budget.
For some, looks may be the most important thing, while others need to tick all the spec boxes. Fair enough, but the reality for most is somewhere in the middle of “I like it, it meets my needs, and I can afford it”.
As with all big purchases it pays to do your homework before committing – that includes weighing the pros and cons, particularly pertaining to cost. Whether you’re paying cash or financing the vehicle, every car owner needs to account for the running costs such as maintenance and fuel.
Head of digitally based car insurer MiWay Blink, Keletso Mpisane suggests approaching the car buying process armed with a clear understanding of your needs and your budget, and to take the time to research the market – whether you do it online or by speaking to a consultant at a reputable dealership. “Your car is going to cost you a lot of money in the long run – and also give you a lot of pleasure – so it’s worth approaching the process with care and consideration,” she says.
First things first
Once you’re clear on your wants and needs, and how much you are willing and able to spend, you can start the research.
Compare different models and brands of cars that meet your criteria and see what they offer in terms of value, quality, features, performance, and reliability.
It is also helpful to distinguish between your negotiables and non-negotiables. For example, leather seats may be nice to have but if it means paying R20 000 more you may be willing to forego this luxury for the sake of saving a few bucks. Whereas if you’ve established that you must have a seven-seater to accommodate your family, there’s no point in settling for a five-seater because it simply won’t do the job.
Budget balance
Your budget for your new car should be the ultimate determinant of what you purchase eventually.
Ask yourself how much you can spend on a monthly repayment, fuel, servicing and maintenance costs, wear-and-tear items (such as tyres) and insurance.
“While the general rule of thumb is not to exceed 30% of your monthly income on a car installment, it’s always safer to be on the lower side of the cost spectrum to allow for unforeseen expenses and increasing interest rates. You should also make room for insurance because it can be a financial safety net should your car be stolen or damaged,” Mpisane says.
Car finance contracts typically run for between 12 and 72 months. A longer repayment period can bring down your monthly repayments, but keep in mind that you’re paying more interest in the long run. A residual or balloon payment can bring monthly repayments down even further, but the residual will be required all at once at the end of the loan, which means that you’d have to save for it throughout your loan period.
Also consider how much you can put towards a deposit, as this will reduce your loan amount and the interest you pay over the loan period.
Mpisane points out, “Don’t be afraid to negotiate with dealers. You can also look for special offers in the market like discounts, trade-ins, or incentives that may lower the price or add value to your purchase.”
Second-time around
If you are buying a used car, make very sure the vehicle has a comprehensive, documented service history. If the service book isn’t up-to-date, you might find yourself buying someone else’s problems!
If you are buying a used car, you can check the history of the car using its VIN number or registration number. You can also ask for details on its maintenance plan, service history, accident history, warranty status, etc. You should always inspect the car thoroughly before buying it and take it for a test drive
One of the most common scams in South Africa is selling stolen or cloned cars, which means that the car has a fake or duplicated vehicle identification number (VIN) and registration papers.
“To avoid this, you should always ask for the original documents of the car, such as the title deed, the service book, and the roadworthy certificate. You should also verify the VIN and the license plate number with the National Traffic Information System (eNaTIS) or a reputable online service. If possible, you should also get a professional mechanic to inspect the car for any signs of tampering or damage”.
Once these aspects have been considered, you can then buy your car, register it and make it roadworthy.
