By Gemma Murray | There are bound to be some pressing questions on your mind and for this very reason, we've compiled a comprehensive buyer's guide focusing on the safety, affordability, maintenance and practicality when choosing the ideal car.
Let's first take a look at the advantages and disadvantages of buying a new or used car.
Advantages of buying a new car
- You'll generally get a comprehensive warranty package.
- No previous wear and tear, mechanical or body damage.
- The dealer may offer financing at a lower interest rate.
- You could be offered additional options and features.
- The purchase price is usually much higher.
- Value greatly depreciates the moment you drive it off the floor.
- New upgrades or features could take effect soon after purchase.
- Insurance, taxes and registration fees are higher.
- The purchase price is lower overall and could be even lower if you buy privately.
- Used cars continue to depreciate, but typically the most during the first two to three years.
- You can sell it for almost the same price you bought it for if it's well-maintained.
- Insurance rates tend to be lower.
- May not be as reliable as a new car unless you buy a certified pre-owned vehicle.
- Interest rates could be higher when financing.
- Limited or no warranty.
- Higher maintenance costs.
- You can't pre-order the car with the features of your choice.
Here's what you should know when buying your first car
1. Applying for Finance
Once you've done all your homework on the car you want and you know you can afford it, applying for finance is simple. Visit the dealership where a Finance and Insurance (F&I) representative will be able to give you advice, explain everything about the loan application and help get the wheels rolling.
2. There is no such thing as a silly question
Dealerships have their own F&I representatives who are registered with the National Credit Regulator who will guide you through the entire purchasing process. When you go to the dealership to close the deal on your first car, don't be shy to ask questions if you don't understand anything. This is your last chance to do so before signing on the dotted line.
As exciting as it may be to drive away in your new car, be patient and don't rush the process. Here is another interesting article with a few more tips on buying your first car.
3. Know your budget
There's no denying that car payments go beyond just the monthly repayments. You need to be honest with yourself as to what you can really afford. Remember to include insurance, fuel and running costs to your budget. If you can't really afford the fuel or maintenance cost for a big 4x4, consider something more fuel-efficient and affordable. Great options currently in the market are snazzy Datsun GO and the gutsy Renault Kwid.
4. Forget the debt
Life is too short to worry about unnecessary debt. If you can't afford an expensive car, be patient and avoid balloon payments where possible. If you can afford to, rather choose the shortest possible term for the loan even if it means your repayments are slightly higher. The sooner you pay off your car, the sooner you will be debt-free.
5. Insurance is non-negotiable
Before taking to the road in your new car, you need to produce proof of insurance. If you have pre-existing cover, simply provide them with your document and if the dealership arranged insurance for you, they will already have it on file.
You are required to maintain comprehensive insurance on the car for the duration of the financial agreement. This not only protects you and your finances, it also gives you peace of mind knowing you are covered. Your insurance will pay out the insured value of the car should anything happen which means you don't have to continue the repayments on a car you no longer have.
Consider this when car-hunting in South Africa:
1. Is it affordable?
Budgeting is important for many South Africans as not everyone can afford to pay the current price for new cars, not even the 'entry level' or 'budget' ones. The used car market provides many good options but you have to do thorough research before buying anything.
2. How well has it been maintained?
Maintenance is as important as affordability if not more as you can always plan and manage your monthly repayments but not so much the unforeseen maintenance issues.
More often than not, a used car will no longer have a service plan which means the car owner needs to pay for all repairs and services out of pocket. Where possible, choose a car with a full service history (FSH) and a strong national dealer network. Make sure you can afford out-of-warranty repairs or services from new tyres and shocks to engine or transmission issues.
3. What is the level of safety?
Looking back in history, for a long time, only the most expensive cars had additional safety features. Nowadays airbags, ABS, EBD, impact bars and crumple zones are more common. Considering the rising death toll on South African roads over the last few years, these safety features have become more a necessity than a luxury.
Remember to check the following when buying your first car:
- Condition of all safety belts - strength, intensity and resistance.
- Ensure that there is a legal amount of tread on all the tyres and don't forget the spare wheel. In some cases, you can ask the dealer or seller to fit new tyres if necessary.
- Test the hooter and all the lights outside and inside the car.
- Ensure that the vehicle tool kit is complete and check that the car jack is in working order.
- Ask for the car's accident history report. Some dealers may not tell you this unless you ask.
- Research the vehicle's NCAP safety rating.
Find an affordable car that is suitable and practical for you or your child. Check that the boot is big enough to hold a few suitcases and bags for a weekend away. A two-door car might seem like a good idea but it is impractical. Loading and unloading passengers is not easy, the boot is small and not much leg- and headroom.
Consider what the car will mainly be used for and choose accordingly. Will it only be used to and from college or university or what about cross-country road trips? Perhaps your child is studying engineering, construction or a subject where they are likely to need something more durable and able to carry a heavy load at some point.
It's important not to just buy the first good looking car you see as you might be stuck with it for years. Be smart, be patient and enjoy the ride!