The second-hand car market has always been a lucrative option for first-time car buyers and for people who want more in less. With the advent of platforms like Olx and Quikr, the car-finding process has become much easier. In fact, sellers are much more confident in putting out their car for sale on online platforms.
The second-hand car market has shown a steady growth in India and is expected to reach a total of 6.6 million units in 2021. Olx India, which currently has a 77 per cent market share in the pre-owned car segment in India, gets 45 percent of its views from this segment.
One of the biggest challenges that a second-hand car buyer faces is peace of mind after completing the purchase. However, this can be achieved by following a few simple steps. Here are a few tips by Sunny Kataria, Director, Auto Category, Olx India:
1). Identify the right model and make: Once you set the budget aside, you should define what sort of a car best meets your needs - depending on the number of members in your family. Identify the key parameters that are important to you like fuel type and other bells and whistles like Bluetooth, rain sensing wipers, automated seats, AT transmission among others.
(2) Inspect the car: Look for any outer damage, dent, rust and tyre condition. Under the hood, check that the car still has the original engine. Also, watch out for any loose fitting in the interiors. Take along a trusted car expert or mechanic who will provide more details about the car. Ensure you test drive the car and even check for the service history at the authorized outlets to understand the vehicle's service periodicity and body repairs if any.
(3) Check for all documentation: As an informed buyer, one should make sure to check the car's original documentation for discrepancies. Important documents that you should verify are:
Invoice and RC: Make sure to check car's original invoice and RC. Details like the chassis and engine numbers can be found here.
Insurance: Check whether the insurance is with a known bank or basic third-party and when it will expire.
Finance NOC: If you are looking at a financed car, make sure that the NOC is valid. Cross-check with the finance company directly to make sure there is no outstanding loan on the car.
(4) Negotiate well: If you are buying or selling a pre-owned car then negotiation becomes an important aspect for both the seller and buyer. You can negotiate anywhere between 5-10 per cent of the value depending on the circumstances. Users looking to sell off their cars immediately will offer buyers a throwaway price. Scouting such deals takes time and both buyers and sellers should do the proper paperwork and meet in person only at a public place to close the deal.
(5) Used car finance: If you have a limited budget, you can always avail a used-car loan. Leading banks like HDFC, ICICI, Kotak and Mahindra Finance offer used car loans. Public sector banks also offer loan on used cars. While the interest rates on used cars are slightly higher than a new car, it may vary from 15 per cent to 18 per cent.