Money Matters : Checklist for buying your dream car

The holiday seasons are a popular time for many of us to purchase our ideal vehicle. Automobile manufacturers and dealers frequently have fantastic deals at this time. For those of you planning to get a new vehicle this holiday season, here is a checklist of eight things to complete before you purchase your ideal vehicle.

Search, compare and select a car:
Primary attributes:
• Car brand value, reviews and references (brand reliability and innovations).
• New launches.
• Buying power/affordability/cost of ownership.
• Car body style (hatchback, SUV, MUV, sedan etc.).
• Choice of engine (petrol/diesel/ EV/CNG) & transmission (AT/MT).
• Smart and convenient attributes in the car.
• After-sales service (dealer network/service centres).
• Resale value.
Additional attributes for buying used cars:
• Present car condition e.g. kilometres are driven, accidental history etc.
• Warranty and certified car.
• Verify the authenticity/title of the registration certificate, NOC etc.
• Dealer reputation.
• Fair valuation.
• Easy access to finance.
• After-sales support.
Check if you have a pre-approved car loan offer with your bank/financier
• Avail of a car loan from branches of banks/other financiers.
• Digital loan sanction from financier website.
• Authorised manufacturer dealerships.
• Organised startups for used car loans.
Know/assess the % of the loan to value (LTV)
• Higher the % of LTV, the lower the down payment.
• Additional funding: Check with your bank/financier if they also offer loans on any add-ons like genuine accessories and manufacturer-backed AMC and service packages over and above the on-road car price.
Choose your loan tenure and type of interest rate.
• Longer the tenure, the lower the EMI Maximum Loan Tenure: 8 years
• For used cars: A loan is provided till the age of the car reaches 12 years
• Rate of Interest: Fixed (constant for whole loan tenure) or Floating (changes as per benchmark rate).
Customise your EMIs
• Standard: Most common repayment method — Equated instalments throughout the loan tenure.
• Graded: Non-equated instalments across loan tenure — Generally reduces monthly EMI obligations.
• Balloon/ Bullet: Balloon: Borrowers are to make lump sum payments towards the end of repayment tenure Bullet: Borrowers are to make lump sum payments towards the end of every year.
• Step up: Initial EMI is low and increases annually — Best suited for borrowers who expect income to increase annually.
Check if instant sanction/disbursement is available
• Quick Loan Sanction allows swift delivery of the dream car documentation requisites.
• Minimal documentation makes it a hassle-free loan proceedings dealer disbursement.
• End-to-end digital customer journey and financing with the opportunity to avail loan disbursement easily and conveniently from the comfort of home, office or any remote location.
Check for other fees and charges
• Foreclosure &/or part pre-payment charges processing fee and other charges.
• Check for other charges on the financier’s website.
Check loan-servicing service post disbursement
• Ease of obtaining statements of accounts, foreclosure statements, no objection certificates etc.
• The number of branches and proximity of branches.
• Dispute and grievance redressal mechanism.
• Digital access to the loan account.