Cars are known to be notoriously expensive in Singapore, and even with the lower COE prices these days, buying a used car might be a more economical choice for many. Perhaps you are someone who needs a car for your job but do not wish to spend too much on a car. Or maybe you are a first-time driver who may want to purchase a used car first before putting down that huge down payment for a new ride.
Purchasing a car is a huge financial decision; what’s more, getting a used car still requires a substantial sum. Thus, it makes sense that you find out all about getting a used car and common issues you might face before deciding whether it’s money worth spending. Below, we have compiled some tips to guide you through buying a used car in Singapore.
5 Key Considerations before buying a used car
1. How old/used is the car?
Let’s not lie to ourselves; the age of the car will definitely have an impact on its future usage. You can look at the car’s mileage as a guide – in Singapore, it should be around 15,000 to 18,000 km a year.
While the mileage can give you a rough gauge, a car with too little mileage can also indicate that there could be certain problems with the car. This is especially true if the car has gone through more than one owner. You might also want to find out the reason why the current owner is selling the car.
2. Is it a COE car or PARF car?
What’s all that synonym, you might wonder. When you’re looking to buy a used car, you have the option of buying either a PARF car or a COE car. A PARF car is a car under 10 years of age, which means it is still eligible to qualify you for a PARF rebate if you deregister it before it surpasses 10 years. A COE car is a car that has had its COE renewed through its former owner paying the Prevailing Quota Premium (PQP) for either 5 or 10 additional years and is at least 10 years old.
So why does it concern you? This is because it will indicate how much you can get back in “scrap value”.
The main advantage of getting a COE car is that it is much cheaper compared to the newer PARF cars. The road tax you’ll incur is however, higher for COE cars, not to mention they’ll likely require more repairs compared to a newer car.
3. Evaluating a used car
Like many other items, it is hard to know on-hand the possible problems you might face with a second-hand item. The same goes for the car. If possible, take it for a test-drive. Other common issues one can face with a used car are water damage(rust, condensation, mould), structural damage and gearbox failures. It can be a good idea to get a used car checked by a trusted mechanic before buying it.
4. How/Where to buy a used car?
Similar to buying a new car, do your research on the type of car you are looking for. You can buy a used car either from a direct seller or a used car dealer. The advantage of buying used cars from dealers is that you are protected as a consumer by the Lemon Law.
Buying from an individual seller would require more work on your part to ensure the roadworthiness of the car. The benefit is that you can often find much cheaper cars this way.
5. Money Matters
Getting a used car does not mean you take over the car insurance from the previous owner; you’ll actually have to take up a car insurance of your own. You can ask for a free instant quote here by filling in some details. If it’s your first time getting a car insurance, you might want to read this article to find out more about the different types of car insurance available and what determines its price.
You will also need to find out about how much loan you can take out to finance your car purchase. You can apply for a bank loan if the car is less than 10 years old from the original date of registration, to be paid up within 7 years or less.
Buying used cars may seem like a risky bet, but it can be an economic decision given that cars are so expensive here. Since used cars vary significantly in condition, spending more time on research and viewing more vehicles would allow you to get a better sense of the type of car you are looking for. Consider the above issues carefully and do your homework – you’ll soon be on your way to miles of happy driving ahead.