Published on November 3, 2022
3 Things To Keep In Mind Before Purchasing A Car
Often, first-time car buyers may be tempted to go all out. After all, cruising around in a brand-new Mercedes or BMW certainly sounds like a dream. But, tempting as it may seem, it is also important to live within your means. You would not want to spend on a car that you won’t be able to maintain.
For most, a car most likely remains the second largest investment after their house, making it a huge financial commitment. Therefore, it is recommended to consult car finance companies in Singapore before purchasing your new ride to get advice on the best deals offered.
Here are some important factors to take note of when purchasing a car in Singapore.
- Choosing between new and pre-owned cars
There’s no denying that a brand new car comes with its own appeal, from the new car smell to the shiny paint, the brand new interior and the admiration from your loved ones. Although used cars may lack the charm new cars possess, they have their own advantages too including lower prices, lower depreciation rates and more. So before you decide on a car, here are some questions you should ask yourself.
- What is your budget – If you have a higher budget and money is not an issue, you can consider getting a new car. But if you can’t afford the down payment, a used car would be a better option.
- What are the risks – Although not all, some used cars may have maintenance issues that might not be cheap. New cars, on the other hand, might have safety issues and defects that would be a problem down the road.
- How soon do you need the car – Bidding for the COE of a car can be quite tiring, especially if your bid has failed the first few times. After getting the COE, you would still have to wait for your car to arrive which can take weeks to a couple of months. If you require a car urgently, a used car would be the wiser choice.
2.Decide on the most appropriate loan terms
Just like shopping for the best car out there, you should also look around for the best deals when it comes to loans. Compare the different options, interest rates and insurance from banks, finance companies in Singapore and private lenders. Some might offer you lower interest rates while others provide a flexible repayment plan.
Regardless of a new car loan or a used car loan in Singapore, it is important to calculate the interest rate charged monthly. A smaller interest rate with a longer repayment plan might not necessarily be a good option as it could result in more interest being accumulated over your loan period.
Learn More: 4 Benefits Of Applying For An In-House COE Renewal Loan
3.Focus on the total cost instead of monthly repayments
When applying for a car loan, many people tend to focus only on one thing – if they will be able to afford the monthly payment. While paying off your monthly dues is crucial, it is not the most important factor. Do look beyond your monthly repayments and evaluate the total cost instead.
Keeping the total cost of your loan as low as possible saves you the worry of interest rates. While your monthly payment may not seem much, paying a low monthly payment for a long period of time does add up.
Always remember that buying a car and taking a loan for it is a huge financial commitment, so be sure to look out for the best rates and deals. To make it easier for you, you can also check out Swee Seng Credit for the best in-house car loans in Singapore. Contact us to know more about our services.