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Insurance | 31.03.2014 - 11:51

Five Finance Tips for Buying a Used Car

Many Car Buyers look for a new ride when they get into a showroom, but it would be prudent to look for used cars also while shopping. For some people new cars are better option but the truth is a used car is way better than new one.

Many Car Buyers look for a new ride when they get into a showroom, but it would be prudent to look for used cars also while shopping. For some people new cars are better option but the truth is a used car is way better than new one.

Generally a new car loses its value around 30% within a few months of usage and even the insurance rates are higher for a new car. Buying a used car saves a large amount of money undeniably, like factory costs, taxes, etc.  Moreover, the insurance rates are lesser for a pre-owned car.

 

However, there are some issues of headache associated with used car financing, such as CIBIL (Credit Information Bureau Limited) scores and possibility of denial on a loan sanction, etc. These factors can cause a real problem. To help you get the best car finance for used cars, here are 5 tips.

 

5 Tips to Go For Used Car Finance:

 

Check Out Better Rates At Different Financing Institutions :

 

If you need loan for a used car, check around and compare quotes from different financial institutions for better rates. Though nowadays many car dealers have tie ups with various banks for better outputs both for the dealers and the banks, they force you to take up their banks with which they have tie ups. Though it may be a good deal, but also check for other banks and lending institutions if they have schemes which offer you better rate or better options in terms of their return policies.
Better rate simply means better line of credit, low rate of interest, foreclosure options, etc.

Shopping Time:

 

You should shop within the weekdays as the weekends are the prime time for them. Mondays are the best to go, because generally Mondays are like dry days for the salesman. They are more than delighted to see a potential customer walk-in on a Monday and tend to offer better deals.


You can also shop at the end of the month, since dealers usually get bonuses at the month end for good sales or achieving or over achieving their targets. So if during the month end if the dealer is short of 1 car for winning their bonus  so the salesman will give you the best possible deal in the lure of getting bonus

Pay It In Cash :

 

If it is possible to pay in cash, then try to do it. It is the best which helps you save on interests, financing cost, processing fees, etc. You can put your money into a more profitable savings account which offers you more interest rather than taking a loan.

 

Fast Repayment :

 

Look for a loan which offers you foreclosure facilities with n penalty or wherein you can pay more when you have more savings rather than a fixed EMI. This will help you in paying off the loan faster resulting in lower interest payment.

Refinancing Your Loan :

 

1 year down the line, consider refinancing it to a better lending institution which offers a lower rate of interest. Also the ideal used car finance should be not more than 3 or 5 years.

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