Buying a new car? Here is a complete guide for first-time car buyers with tips on how to set a budget, select the right type of loan, and check other aspects.
The Ultimate Guide for First-Time Car Buyers in India
Are you planning to save as much money as you can to buy a car that you like?
Purchasing a car is a significant investment, but it can feel complicated at first due to the associated costs. First-time car buyers should do proper planning and check every detail, from budget to loan procedure, while buying a car.
Don’t worry and just relax, as we will help you get through the process of buying a car so that it remains exciting and not overwhelming. Follow this post as a guide to navigate the process.
1. Set a Realistic Budget for Buying a Car
Do you want to buy a car to commute to work every day or go for long intercity drives? Some people buy cars for business or commercial purposes, like using them as a taxi or cab service.
If you are buying your first car and you do not have enough knowledge, then this step will help you deal with the reality of your finances:
● On-road cost of the car: The final on-road price of a car is significantly higher than the ex-showroom price of the car. That’s because you also need to pay vehicle registration fees and buy insurance.
- The car registration charges and road tax in India vary from 8% to 14% depending on the type of car (petrol, diesel, electric) and the Indian state where you buy the car.
- You must buy car insurance to cover your own damage and third-party liability. As first-time car buyers, don’t miss useful add-ons like engine protection, zero dep., roadside assistance (RSA), and RTI (return to invoice). These add-ons will protect you and help maximize your insurance claim value in case of accidents and other mishaps.
● Maintenance: Whether you are buying a new car, used car, or pre-owned car, it requires servicing and maintenance after some time.
● Fuel costs: You must calculate the monthly fuel consumption based on your driving habits to understand how much money you’ll spend every month on fuel.
2. Decide Between Buying a New Car or a Pre-Owned Car
● New cars: Buying a new car means, you will get the advantage of warranties, advanced features, and a fresh feel. However, they are more expensive, and their costs depreciate very fast.
● Pre-owned cars: It should be a great option if you are on a budget but still want quality. These days, certified pre-owned cars are available with inspection reports, warranties, and often lower depreciation rates. According to data and reports, India’s pre-owned car market is at the stage of growing, and it is expected to reach around 8.2 million units by the financial year 2025.
● Used cars: These cars are comparatively cheaper, but you may need to bear additional repair costs or maintenance costs on used cars, based on the quality of the vehicle. It is, therefore, essential to vet the history of the used car before applying for a used car loan. Check for the vehicle’s quality, pending traffic challans, or any offensive history it may have.
Pro tip: If you are searching for a balance between affordability and reliability, a certified pre-owned car could be the best option for you.
3. Check the Condition and Features of the Car
A car is a significant investment, and before finalizing a deal, you must check the features and condition of the car, including key points like:
● Mileage: If you travel daily or plan to drive the car for long distances, then this should be a priority for you. Generally, CNG cars are good for driving in the city due to the best fuel economy. Petrol cars are good for commercial or intercity travel as their maintenance costs are lower than diesel cars.
● Transmission: You can choose either manual or automatic transmission as per your needs, but an automatic gearbox is costlier. However, an automatic car can be a good option for first-time car buyers as you lack experience in driving a car.
● Test drive: Always take a test drive, as it helps you understand how smooth its steering, clutch, accelerator, and overall functions are. You also get an actual feel of the car.
● Vehicle history: If buying a pre-owned or used car, you must check the Vehicle Identification Number (VIN) to learn about its history, previous owners, and accidents. This process helps you detect and save yourself from any fraud, such as buying a stolen car.
● Professional used car checkup: When buying a used car, it’s best to hire a professional checkup service or a mechanic to assess the car engine, steering, brakes, and other conditions.
4. Explore Different Car Loans and Financing Options
Buying a car can feel overwhelming at first due to the involvement of high costs, and at this moment, a car loan is the perfect helping hand one needs. You can get a loan from banks, NBFCs, and other financial institutions. However, you must try to secure a loan with a suitable tenure and a low interest rate. We at SK Finance offer easy car loans and financing options for every type of car to help first-time car buyers like you get on the roads without any struggle. We offer both new car loan and used car loan.
The best loan providers ask for minimal documentation and offer quick processing of car loans. That’s exactly what we’re known for. Whether you’re a salaried individual, a self-employed individual, or a lower-income person like a taxi driver, visit your nearest SK Finance branch for seamless auto loan approval and flexible repayment options.
Pro tip: When you foreclose or finish your loan repayment, remember to get a loan NOC (No Objection Certificate) from the loan provider. This certificate is proof that your loan has been fully repaid and there are no dues left. It helps you resell the car in the future.
At SK Finance, we automatically initiate the loan NOC process as soon as your EMIs end, and it is generally completed within 30 days.
5. Don’t Miss Buying a Car Insurance
As a first-time car buyer, you must know that buying car insurance is not an option, but a necessity. In India, it is mandatory to have at least a third-party insurance by law, as it protects against any legal liability to a third party due to an accident.
However, you should buy comprehensive car insurance with the following coverages:
● Third-party insurance
● Own-damage car insurance
● Return to invoice value (RTI)
● Engine protect
● Roadside assistance (RSA)
● Zero-dep insurance
Buy Your First Car with SK Finance!
Make your car purchase a happy experience with the best loan offers and assistance from our experts at SK Finance.
We’ll help you pick the right car loan tenure and repayment options based on your income and goals. We also offer attractive car loan interest rates and excellent customer support to ensure you enjoy the process as a first-time car buyer.
Apply for a car loan today!
