Whether to buy a car, how to finance a car, what car to buy are all important steps while buying.

So here is a list of things that you should do if you were to buy a car:

1. Do your homework: The internet has surely made it easier to compare cars, compare features, understand what the car can do for you. And as they say ‘there is no substitute for hard work”.

2. Know your needs: If you are single or have just one kid, remember you need a small compact car like a Nano or an Indica. Just because your company’s HR said ‘you are entitled to Rs. 17,500 pm as car expenses reimbursed (emi)” it may not make sense to buy a big car.

3  Your old car can fetch a decent price in the second hand car market. It is much better to sell your car in the second hand market instead of trading in with the dealer. It is a lazy option, not a smart one.

4. Look at the total deal: Do not be obssesed with the EMI amount. See the total cost, the discounts, and how much of down payment you can make. Fairly obvious, higher the amount of down payment, the better.

5. Taking off on point No. 1 – shop around and get a pre-deal sanction from a bank. The most advertising banks are NOT the cheapest. A psu bank might be a pain to deal with – but that pain is built into the pricing pleasure!

6. Do your home work, pre shop the car, pre shop the finances: all this effort is lost if you let your spouse/ salesman talk you into buying a bigger, better, more expensive car. Stick to your guns immaterial of what the salesman says.

7. Do not be a ‘features’ creep bother you: when you buy a phone, music system or a car the salesman will show you some feature (a fad of the week?) which looks attractive. Do not fall for it -e.g. a GPS esp if your commute is largely home to office!! Your cell phone too has a gps download which you can use…

8. Wait to buy a model: You really do not need to buy the latest model on the first day, do you? Just wait a bit…and you will find better deals. Honest. That is how the car industry works.

9. Shopping around for a slightly used car is not a bad idea. I got a Rs. 38L costing BMW for Rs. 22 L – it was used for 6 months, but was only 840 kms old. Not a bad deal at all, right? Not that I bought it, but I do think the deal was cool.

more to follow…later?


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  1. Hi Subra,

    I agree for second hand car, only drawback is there is no way to authenticate second hand car with reliable way. In other countries, using VIN you can check entire history of car when it was serviced, whether it has met accident or not…

  2. my friend used maruti ‘true value’ option to buy second hand cars – they offered 1 yr warranty & honored it whenever major/minor problems happened. he has used it at least 3 times…

  3. True, one should never stretch his finance to buy a fancy looking car.

    I had a fixed budget of 4L and bought whatever best I got in that price.
    Paid 100% in down payment with some interest free loan from my employer. Spouse was not happy with looks but manged to convince.

    Also the best time to buy i during year end, or any time when car demands goes down. This gives opportunity to get good discounts. I could manage 25K cash discount, had to wait for few months to avail this.

  4. On a diffrent note…Subra always emphasise on Proper and adequate retirement planning.Regular Readers to this blog knows it very well.Sorry to learn that Legendary Mehdi Hassan sabs ….a Man with Golden Voice ….last few years were full of sufferings not only on Physical Suffering front but also on Financial front …to Pay Hospital Bills and for his treatment ..his sons were forced to do Musical concerts ….. May His Soul Rest In Peace .LETS TAKE RETIREMENT VERY VERY SERIOUSLY FELLOW READERS

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