5 Tips To Purchase A Pre-Owned Car 19 June 2012

1. Determine your requirements

To start with, you need to decide the type of car you want to buy. Do you want a hatchback or a sedan? The mileage of the former is better than that of the latter. Would you prefer a petrol car or a diesel one? A diesel car will be more costly upfront, but you will recoup the extra money if you plan to drive often and for longer distances, or on the highways. However, the maintenance cost will be more for a diesel vehicle. A petrol car will be better for city usage and its maintenance cost will be relatively less too.

Next, get a fix on your budget. Factor in the fact that you may need to upgrade the car, such as installing new seat covers or replacing old tyres. So split your money into two parts: price of the car and renovation fund. Don't forget to include registration and insurance cost.

2. Canvass the market

Visit various car dealerships, such as Mahindra's First Choice Wheels and Maruti's True Value, as well as portals like zigwheels.com, to see whether they have the type of car you want. Make a list of various variants, their years of original sale and the condition they are in. Find out the current market value of these second-hand vehicles as it will give you a good idea of the kind of car you can get within your budget. Once you have filtered your list, go through online reviews about these cars. It's preferable to choose a car that is not more than five years old as the maintenance cost for older cars is usually higher. Also, check the distance for which the vehicle has been driven. If a petrol car has been driven for more than 10,000-13,000 km a year, and a diesel vehicle for more than 15,000-18,000 km a year, or it has changed hands more than once, bargain hard to lower the price.

 3. Settle on the car you want

Focus on 2-3 cars that you like most and dig up their history. Ask the owner all the details about the car, no matter how insignificant they sound. Has it ever been in an accident? How many people have driven the car—just the owner or other members of the family and a driver? Inspect the car thoroughly. If you are not confident, hire a qualified mechanic for a couple of hours to go through it. Always check the car in daylight as dents and rust will be clearly visible. Any sign of welding indicates that the car was involved in a mishap. Take the car for a test drive for about 5 km, preferably on a bumpy road, as it will help you to know the car better. Is it easy to change the gears? Do you need to push hard on the brakes to stop? Are there any rattling sounds? Make sure you don't come across these problems before picking one up.

4. Check the paperwork

The paperwork should be original. Don't settle for any photocopied documents because you can't be too sure that the car isn't stolen. Go through the service book of the car to ensure that the vehicle has been serviced regularly. The important documents that you should obtain from the owner are the RTO tax receipt, registration certificate (RC), insurance papers and the original invoice. The car's chassis number in the RC and invoice should be the same as on the engine. If it's not, the implication is that the engine has been changed. Check the state in which the vehicle has been registered. If you plan to use it in a different state, you will have to get the registration transferred. In case of insurance, make sure that the premium has been paid regularly and the date on which the next one is due. Ask the owner if there is an outstanding loan on the car. If there is, you should ask him to repay the entire loan and obtain a no-objection certificate from the finance company before you buy the vehicle.

 5. Close the deal

As you already have a price range in mind for the car, start with the lowest figure. Since there are a lot of used cars in the market, sellers are willing to negotiate and lower their asking price by a small margin. However, you should have a valid argument about why you want the price lowered. If the seller isn't satisfied with your reasoning, increase the price a bit. This will depend on the condition of the car and the accessories used. However, don't be taken in by unimportant ones, such as mudflaps and decals.

Once you've finalised the deal, discuss the mode of payment. It is advisable to pay through a demand draft, not cash. Ensure that you get a receipt with the seller's full details, including address.

After you buy the car, the previous owner should inform the RTO with which the car was registered about the sale through a letter within 14 days. If you fall in the jurisdiction of another RTO, you will have to inform your RTO by sending a similar letter in the given period.

Source : Economic Times ,  Via :  investmentkit.com & http://rmssa.blogspot.in/