Should you buy that vehicle?

If you are not intimately familiar with all the technical intricacies of an automobile and don't know all the latest car models and their vital statistics by heart, choosing a reliable car can be difficult. A nice paint job and new tyres won't guarantee that the vehicle won't fall apart on the road a week later. A few simple steps could, however, help even the most ignorant vehicle buyer to pick a winner:

- Get a mechanic to check the car. Arrange to take the vehicle to his workplace for a quick once-over. Make sure that the car was not involved in a major accident and that the engine and all parts are in good working order. Ask the mechanic to check that the odometer has not been tampered with. Also check with the mechanic that the asking price is in line with what he thinks is a fair value for the car. 

- Scrutinize the warranties offered by the car dealer.  If you are considering buying a new vehicle, make sure that you get a factory warranty.  If at all possible, demand a full service record from the dealer. 

- Check the tyres thoroughly.

- You should at all times be allowed to inspect the car. If you are prevented from doing this in any way, walk away from the transaction.  Find out what the book value of the car is. If there is a huge discrepancy between the book value and asking price, reconsider carefully. If you are buying the car from an individual owner, the price should usually be a bit lower.

How will you secure financing best suited to your needs?

Buying a car will probably be one of the biggest investments of your life. It is also an investment decision that could be swayed most by personal preference and emotional factors. For example, most people have trouble resisting the lure of attractive and more expensive cars, while the unexciting but cheaper options would cause them less financial hardship in the years to come. Here are some guidelines to make sure that your financing deal will not be a burden: 

- Shop around for financing before you go to a dealer. Check if the bank you have most of your accounts with will give you a discounted interest rate or more advantageous loan terms. If not, investigate other financing options before you got to a dealer. 

- Establish exactly how much you can afford to spend on vehicle payments. Keep additional vehicle expenses in mind when you do the calculation. Vehicle insurance, annual registrations fees (currently around R120), fuel and maintenance costs (car services, batteries, tires and oil) will take up a significant amount of your budget.  - Determine precisely how much the vehicle will cost you. Verify what the total amount of interest on the transaction will be. Don't just focus on whether you can afford the monthly payment. By looking at the bigger picture you will have a better idea of how much the vehicle will really end up costing you. 

- Always write down everything a dealer and lending institutions promise in initial conversations. Compare this to what the contract stipulates in the end. Always verify that the rates you were quoted are the rates that appear in the contract - as well as the total amount the car will cost you, the loan terms and the monthly payment.  Make certain that there are no empty spaces or incomplete sections on the contract. Do not sign a contract if you feel uncomfortable with any aspect of it. Some car owners finance their vehicles through an extension on their mortgages. This can be dangerous: if you default on the vehicle payments you stand to loose your house as well as your vehicle.  Car dealers often offer maintenance warranties and other supplementary service contracts as part of the sale. Make sure that you understand all the terms and fees involved in these contracts.