Buying a new car can be an exciting process. The reality however, is that getting to buy the car you’ve been dreaming of is often a luxury available to those who can afford the costs that come with owning a new car.
Before you sign on the dotted line you need to familiarise yourself with a few facts. Buying a new car means that you need to be savvy and you need to as much research as possible.
We’ve come up with a few tips for buying a new car, to make this process as seamless as possible:
Make sure that you deal with a registered company
Don’t rush the process. Make sure that you do the necessary research so that the company through which you choose to finance your new car is registered with the National Credit Regulator.
Do your finance research
A good place to start would be by knowing the difference between a fixed or linked interest rate. A fixed interest rate is often favoured because it means that repayments will remain unaffected by interest rate fluctuations.
It’s important to keep in mind that the longer the contract, the more you end up paying in interest and fees.
By paying a large deposit you’ll end up paying a lower amount in the long run.
Be clear about extras
During the contract-signing process, you’ll be given a breakdown of what extras you are signing up for. This may include delivery, licensing, admin fees etc.
You can arrange this on your own or you can arrange with the dealership to get you insurance. You need to get comprehensive insurance if you’re buying through a bank or if you’re getting finance from a micro lender. This type of cover is for all eventualities.
Consider maintenance costs
It’s important that you buy a car you can afford to maintain, with accessible spare parts. You also need to think about how often you travel per month.
Be clear about how the balloon payment works
This allows you to pay reduced monthly instalments. You then need to pay a large amount when your loan term is due to expire.