Purchasing a new car can be a stressful decision, there are many factors that need to be taken into consideration when making this decision.
First and for most, do not rush such an important decision, this is a purchase that you cannot undo or return, after a purchase usually the car value drops so it is also likely that if you resell the car you may incur a loss so it is advisable that you thoroughly follow the guidelines we have created for you.
According to research, 1/5 new car buyers regret their decision immediately. This is why we have created a step by step guide on how to purchase a new car, we have included everything you must take into consideration and all errors you must avoid.
In order to avoid being one of the five people mentioned above it is important that you make confident financial decisions and in order to be a confident decision maker it is important that you carry out extensive research before making the second biggest purchase of your life, the first being a house.
Buying a car involves a lot of money and no one has money to throw away, this is why you should take steps to avoid falling into traps. This involves not purchasing a car based on a car salesman’s pitch.
Here is the correct way to purchase a new car:
How much money can you afford?
When you consider buying a car, you need to make sure that you have a realistic idea of what your budget is. When you imagine your drive, I’m sure you see yourself in a prestigious Bentley or Rolls Royce but sit back and think about your wallet and how much you can realistically put aside to buy a car?
Once you have decided the amount you are capable of putting aside for the car you can then start to look at cars within your budget.
Do you need financial assistance?
You may be eligible to a preapproved loan, however, you must keep in mind that you will have to return the sum you borrow with interest, it is important to research lenders and who is offering the best loan plan, check with your bank and credit card provider. The loan you opt for should not have a payment plan of longer than 60 months.
Furthermore, You need to make a down payment of the car right away, that means you must have 20% of the total amount on hand at the time of purchase.
In order to approve your loan, banks and credit card companies require the following information;
- Pay slips
- Employment details
- Credit history
Test drive your car
Once you have decided which car you wish to buy and how you will be paying for it, locate the car and take it for a test drive. Buying over the internet is not advisable, it is better if you step out and visit the nearest car showroom.
Factors to consider:
- Is the car still in stock?
- Are there any free add ons, such as free floor mats or theft protection?
- Visit the dealer during an off peak time, so you can get one on one attention.
- Test drive the car you are hoping to buy, schedule this appointment beforehand.
- Take your family for a test drive too, to see if they like the car and fit into it well.
Once you have finalized your choice, you need to start getting a price. Here are two ways to ensure you are getting the best price:
- Contact up to three car dealership workers nearby and ask them the price of the car you are interested in buying, it is better if you email or text them. Also ask them if they will be offering any complimentary add ons, see which dealer is offering the lowest quote and the best package. Ask dealers to beat this quote. This is particularly useful if you are leasing your car you can obtain a bargain on your lease.
- There are numerous websites and apps over the internet that allow you to make a price comparison and they also tell you which dealer is offering your desired car at the cheapest rate. Make sure these comparisons are made inclusive of tax.
Other than the above mentioned, also ask the car dealers about their dealership plans and whether or not they offer a warranty or an insurance at a lower cost.
AVERAGE PAID PRICE
By now you have a car you wish to buy and its price, you probably also know which dealer is providing the best overall package. Review the car price one more time before you make the final deal. The dealer must be offering the “average price” of the car along with some add ons.
It is not good enough to opt for the lowest priced dealer, you need to review the whole deal. The price must be an average price and along with it there must be a package that is better than other dealers. E.g if you are leasing the car take into consideration the interest rate.
Consider parallel importers instead of authorized dealers
Parallel importers Singapore are becoming more and more popular, as having a car showroom or being an authorized dealer can be costly, parallel importers Singapore is breaking the traditions of car dealerships, parallel importing is basically car resellers selling non-counterfeit cars without the permission of the owner, imported from another country. The cars are 100% genuine and 100% legal.
- Parallel imports are cheaper: parallel imports are almost $8000- $10,000 cheaper than authorized dealers because the seller doesn’t have as many overheads as an authorized dealer.
- You can buy cars that are not readily available through authorized dealers, not all dealers can afford to sell Bentleys, Rolls Royce and Mercedez luxury cars but through parallel imports this has become easier. Parallel importers are flexible and are able to release in to the car market models that they believe will sell.
- The parallel importer is able to clear the car from customs him/herself, they can also undertake car registration and inspection, this saves them a lot of hassle as importers can often take too much time getting these chores done.
SEAL THE DEAL
Does the price look fine, is the interest rate reasonable? Did you enjoy the test drive? Have you got all the necessities that go with a new car such as car mats etc.? Have you discussed the warranty? If you answered yes to all of the above questions, it seems like you’re ready to seal the deal and take home your new ride.
Just before you do that, make sure you read the contract thoroughly to avoid any unreasonable terms and conditions that may later effect your purchase. Ask them to fill up the gas tank and take your delivery home or ask them to drop it off for you. Enjoy your new ride.