buying a car Archives - Heels & Horsepower Magazine

New or used? Guide to buying your next car

vuyi on February 13, 2023

Buying a car, new or used, is a big commitment, but with proper planning it does not have to be a daunting one.

There is a vast selection of cars available from a large variety of sellers, making it difficult to find the one that’s right for you. The first thing to do is to ask yourself how much you are prepared to spend on a car and to be realistic about what you can afford.

New or used, that is the question

Which of these is the correct choice? There is no right or wrong answer, but understanding the pros and cons of each is vital for making the best decision for you.

Benefits of buying a new car

The upside of buying a new car is the certainty of knowing exactly what you are buying. No one else has ever owned it, and there’s a guarantee that it has no hidden secrets from previous owners.

You also get the advantage of a full manufacturer’s warranty and in most cases, a service or maintenance plan. These plans can vary from brand to brand in terms of length of validity periods and what’s covered, so do your research and compare what’s on offer from different manufacturers.

Benefits of buying a used car

Choosing a pre-owned car or an earlier year’s model might be more prudent for your purposes. Some used cars, including dealer demo models, are often in almost new condition and still benefit from lengthy aftersales warranties and service plans, with reasonably discounted sticker prices depending on mileage and age.

Most car brands also offer approved pre-owned programmes, meaning these cars come with some added benefits such as extended aftersales plans and guarantees. They also undergo thorough checks by certified workshop technicians in order to get the stamp of approval for ‘approved’ status.

While depreciation is an unavoidable reality of owning a car, used vehicles almost always suffer less depreciation from purchase price than a new one. In other words, the original owner, who bought the car new has already incurred a significant amount of depreciation simply by taking ownership. When buying a used model, you’re starting off from a lower initial outlay and the effects of depreciation are felt less in your wallet.

There are some excellent deals to be found in older model used vehicles, but it can also be a riskier purchase as vehicles’ histories get cloudier as they age. Try to identify cars with full service histories, and even better are those with full histories at official franchise dealers. Also, try to take a trusted mechanic with you to view an older car to make sure there are no major issues before taking delivery.

It’s also worth considering buying extended warranties, either from the manufacturer itself where applicable or from a third party.

Start with a budget

The most important part of the car-buying journey is compiling a list of all current expenses and income. It is important to shop around and compare car prices to find a sensible and affordable car that fits within your budget. Don’t forget to budget for fuel, insurance, tyres, service costs and more – and remember that these costs can change over time.

It is also advisable to build some leeway into your budget to accommodate for rising fuel prices, interest rate increases and unexpected costs associated with driving.

Choose a reputable dealer

If a deal seems too good to be true, it normally is. It might be tempting to buy a newer, fancier car advertised at a low price by a small independent dealer or private seller, but you must let common sense prevail. There is probably a reason why that car is priced the way it is, and you might run into issues with it down the road.

It’s safer to do business with reputable dealers who will go to great lengths to protect their reputation through quality products and customer service.

9 Things We Seldom Think Of Doing When Buying A Car

vuyi on January 7, 2022

By H&H Admin

Buying a car is an exciting time, but to ensure you don’t regret your purchase you’ll have to look beyond the shiny paintwork and glistening rims.

Although cars are produced en masse, finding one which suits your individual needs takes time and effort. Some people want lots of legroom, others, luggage space and there are those whose highest preference is the latest technology and driver convenience.

Here are a few other considerations to consider:

Safety features that are connected to reducing one’s insurance premiums, should be high on every car buyers’ list of priorities. These include, airbags (the more the merrier), electronic stability control, anti-lock brakes, lane departure warning, blind-spot detection, forward and rear cameras, collision alert monitors and electronic stability control, to mention a few.

Ergonomics are critical for operating a vehicle with ease and comfort so when you get behind the wheel, make sure you can effortlessly reach the car’s primary controls.
Open and close both the front and rear car doors to test their weight. It is important that all family members including minors can enter and exit the car stress-free. Similarly, check the weight of the boot door.
Make sure that items you use regularly fit in the car. These could include golf bags, strollers and car seats.
Sit in the rear seats and test leg and headroom.
Ensure that the rear seats are comfortable, supportive and adjustable. Also check if they fold down effortlessly, to increase the luggage space area.
Check that the display screens are easy to read.
Test that the pedals aren’t too soft or hard and that the steering wheel can easily be adjusted upwards, downwards, towards and away from you.
Satisfy yourself that your smartphone and other devices connect quickly and easily to the car’s Bluetooth system.
Check that the car has a modern, or updated GPS which is easy to use.

Because a car is a long-term purchase it is well worth your time to assure yourself that you are as comfortable as you can be with your decision. Once you’ve signed on the dotted line you are bonded to the vehicle for at least 60 months and that’s a long time to drive a car you are entirely happy with.

Age vs. Mileage: Which is more important when buying a pre-owned vehicle?

vuyi on June 21, 2021

Understanding the balance between a vehicle’s age and its mileage is critical when buying a car. Motus South Africa shares invaluable insights for buying a pre-owned car.

When shopping for a pre-owned car, buyers need to find the optimum balance between age and mileage. Understanding how these factors impact a car’s overall condition and which is more important is vital when making a purchasing decision.

In most cases age and mileage work against each other in the manner that the market prices pre-owned vehicles. While mileage drives down the price, the newer the vehicle the higher the price will be.

Two identical cars with the same mileage, but differing by a year in terms of their first registration could differ as much as R50 000.

As mileage directly relates to how much a vehicle was driven; a good rule of thumb is 15 to 20 000km per year, anything more than this is considered high mileage.

The higher the mileage, the higher the wear and tear, but mileage is not the only factor affecting a vehicle’s condition.

When inspecting a vehicle, it is important to try and ascertain how it was used. A bakkie that has high mileage from highway driving will most probably be in better condition than a bakkie that has a lower mileage but spent its life on dirt roads.

How vehicles were stored and cared for can also have a bearing on their condition. A high mileage vehicle that was washed regularly and parked undercover will be in a much better condition than a low mileage vehicle that was not cleaned regularly and spent its life in the sun.

Cars with high mileage in relation to their age might very well have many years of trouble-free use in them still, especially if they have been properly maintained. It is therefore very important to enquire whether the vehicle in question has a full-service history and if any major components have been replaced. Well-maintained vehicles can continue to serve their owners reliably assuming that you continue with the routine of regular maintenance.

“Naturally, there are advantages to buying a newer model vehicle. New cars will feature the latest technology in terms of engines, infotainment, and safety and if that is important to you, it could be worth paying the premium,” says the CEO of Motus Retail and Rental SA, Corné Venter.

Newer cars should also be cheaper to maintain in the medium term as they may still be covered by a manufacturer’s service plan or warranty. Major components like a timing belt, CV joints, and shock absorbers, which can be costly to replace as the mileage creeps up, will still have a few years’ life in them.

All vehicles sold by Motus, irrespective of their mileage are subjected to a comprehensive inspection before being listed for sale, ensuring that they are in a good, roadworthy condition.

Vehicle Finance 101: What You Ought To Know About BALLOON PAYMENTS

vuyi on November 23, 2020

In the excitement of buying a new car, some people make the mistake of not fully understanding the best finance options available to them. In the first of our 3-part Vehicle Finance series, we talk about Balloon Payments.

The majority of South African drivers cannot afford to buy their cars outright and rely on vehicle finance from banks. There are a few different vehicle finance options available to customers, namely:

Balloon Payments
Installment Finance
Guaranteed Future Value

But how do you know which one is best for you? To help you make better-informed decisions, here is what you ought to know about Balloon Payments.

For those in the car market, right now is actually a great time to buy thanks to the current low-interest rates combined with some tasty offers from car dealers around the country.
– Ghana Msibi, CEO of WesBank Motor Division

Balloon payments

This is a convenient solution designed to assist the buyer with cash flow at the start of a finance agreement.

A portion of the purchase price is set aside in order to lower monthly repayments, but it’s important to remember this deferred amount will still be owed to the bank at the end of the contract term.

Balloon payments require discipline to be used effectively, and customers opting for this arrangement should make sure they’re saving enough cash every month to settle the debt once the instalment period is complete.

While the benefits that come with keeping monthly costs down may be extremely appetizing, it is important not to view a balloon deal as a way to get into a car you simply cannot afford.
– GHANA MSIBI, CEO OF WESBANK MOTOR DIVISION

Think of a balloon payment as a deposit, but one that’s put down at the end of the contract term instead of at the beginning. Depending on the size of the balloon, the money saved on the monthly payments should more than cover the cost of interest for a loan to refinance the lump sum of debt at the end of the term.

In other words, saving the money yourself while driving the financed vehicle could be cheaper than it would be to apply for another bank loan to pay off the outstanding debt owing on the car.

“While the benefits that come with keeping monthly costs down may be extremely appetizing, it is important not to view a balloon deal as a way to get into a car you simply cannot afford,” says Msibi.

“A looming lump sum after years of driving a vehicle is easy to ignore and forget, but settling that debt is ultimately the responsibility of the buyer. That said, a balloon payment has some great advantages if used properly.

* All F&I consultants are regulated by the Financial Advisory and Intermediary Services (FAIS) Act and the National Credit Act (NCA).

How to buy a car with a good trade-in value

vuyi on November 12, 2020

Source AASA

What you should know about leasing a car

vuyi on September 22, 2020

Leasing a car is a good alternative to purchasing one but it may not be for everyone

There are many ways through which to finance your new set of wheels but one which is growing in popularity is that of leasing. Here are some basic things you need to know when considering to lease a car.

PROS:

Leasing offers a shorter (generally 36 months) repayment period than the usual 60 – 72 month purchase period
Leasing costs include servicing and ‘normal’ wear and tear to the vehicle
Leasing allows you to drive a new / different car every few years without incurring financial penalties
You’d be driving a car which is covered by the manufacturer’s warranty
Monthly instalments on leased vehicle tend to be lower than purchase price instalments
At end of lease period you won’t have the hassle of selling it because it’s not yours to sell

CONS:

You don’t own the car – essentially you are paying for something you will never own
You are limited to a set number of kilometres annually and risk incurring stiff financial penalties for any distance over the agreed distance
You are likely to be charged extra for ‘above normal’ wear and tear to the vehicle while it is in your possession

As with any contractual purchase, it is important to read and understand the terms and conditions of the agreement before signing on the dotted line; and as with any contract you may be held liable should you not fulfil the terms agreed upon.

Leasing a car is a good alternative to purchasing one but it may not be for everyone nor suite your particular lifestyle and travel needs. Before making the commitment to lease a vehicle, do as much research as possible and weigh the option of leasing against purchasing. Remember that the running costs of a vehicle include weekly fuel costs, insurance, servicing, tyre maintenance, e-tolls and keeping it clean.

Online car sales in South Africa: What’s possible, what’s not and why

vuyi on August 18, 2020

There is both good and bad news for those hoping to click a webpage button and see a new car magically appear a few days later.

Johannesburg, 17 August 2020: Online shopping trends were on an upward trajectory long before the pandemic. Enforced national lockdown saw South Africans investigating how to buy toilet paper and pool chlorine from the comfort and safety of their couches.

The rise in popularity of many existing and new online shopping platforms has fueled the notion that buying cars in similar manner will soon be a reality. Is it possible to buy a car online from start to finish and have it delivered to your driveway without ever leaving home? Yes, but it was prior to COVID-19 and only under exceptional circumstances.

According to Mark Dommisse, Chairman of the National Automobile Dealers’ Association (NADA), there is both good and bad news for those hoping to click a webpage button and see a new car magically appear a few days later.

“Many local car brands are currently advertising new methods for South Africans to browse, and in some cases even buy, their next car from home. While these tools are very handy, there are limitations to how far you can travel along this buying journey, despite clever wording which may imply otherwise,” says Dommisse.

… there are some simple reasons why e-commerce and car sales just don’t gel as a realistic option…
– Mark Dommisse, Chairman of the National Automobile Dealers’ Association (NADA)

The fact is these new services offer an elegant way for Original Equipment Manufacturers (OEMs) and dealers to cast a wider net on a bigger audience, together with convenient solutions for willing participants within that audience. But the progression of any deal will ultimately trickle down to a final transaction between buyer and seller at dealer level.

For most a new or used car is the second highest expense after housing costs, so committing to a large purchase such as this is obviously a bit more complex than ordering a new kettle from Takealot. If your kettle arrives by courier a few days after you enter credit card details and click Buy on your laptop, and you’re not happy with it for whatever reason, you simply return it and get a refund.

Online transactions are governed by the Electronic Communications and Transactions Act (ECTA) and it is here that matters such as offer and acceptance, as well as final delivery are regulated
– MARK DOMMISSE, CHAIRMAN OF THE NATIONAL AUTOMOBILE DEALERS’ ASSOCIATION (NADA)

Besides the fact that kettles don’t come with a myriad upholstery options, optional features, engine choices and paint finishes, they also don’t often come with mandatory insurance, finance plans, FICA requirements and large price tags. More importantly, it’s unlikely you’d be trading in your old kettle, and this process would certainly require some physical interaction to facilitate – as it does with vehicle trade ins.

“While new digital technologies have, and will continue to accelerate and streamline car buying in South Africa, there are some simple reasons why e-commerce and car sales just don’t gel as a realistic option in the foreseeable future,” says Dommisse.

“While there’s no doubt that for some a car is just an appliance, and the smell of leathers, face-to-face interactions and the feel of steering and gear shifts on test drives don’t rank very highly on importance scales, the vast majority of car shoppers would prefer the touch, feel and smell of a genuine showroom experience, or at least to inspect the goods they’re committing to.

“Then there are the nitty-gritty regulations which take the wind out of the sails of the pure online car buying fantasy. Technically all transactions in South Africa, other than for property, can be concluded with a simple offer and acceptance. But online transactions are governed by the Electronic Communications and Transactions Act (ECTA) and it is here that matters such as offer and acceptance, as well as final delivery are regulated”.

The Act is designed for items that are extremely standard and understood by customers – such as a kettle. When it comes to special orders or anything where specifications are set by the consumer, the goods will only be suitable for use or enjoyment by that consumer in particular. Cars often come with many specifiable options, accessories and bolt-on value add products, which would force number of protections generally afforded to consumers by the Act to be excluded.

Adulting – The Art of Buying Your First Car

vuyi on June 25, 2020

For many young students and graduates their first introduction to adulting starts when they make a decision to buy their first car. This can be a daunting experience as car ownership involves many additional expenses such as fuel, insurance and maintenance which can all impact monthly budgets and cash flow.

Becoming independently mobile can be an exciting prospect, but buying a car is also a long term commitment so it’s important to understand the economics involved.

These tips from WesBank will help navigate the decision making and buying process and ensure that students and graduates are better equipped in their financial journey:

• Track your income and expenses:

This means understanding exactly how much you make versus how much you spend. Draw up a detailed budget including income and expenses to determine what you can realistically afford to spend on a car. As difficult as it may be, stick to your budget.

Purchasing a vehicle can be stressful for students and graduates, especially because they do not always have a credit history.

• Spend less than you make every month:

A budget is important as it helps to ensure that you spend less than what you make each month. If you do not track your spending, it can be easy to overspend and ultimately end up in a debt situation that’s difficult to overcome.

• Minimise on lifestyle inflation:

Being young often means high pressure to go out and socialise, or buy the most expensive items of clothing and gadgets, instead of sav- ing towards bigger purchases, like a personal vehicle, a house, or saving for emergencies. It’s important to be aware of your entertainment needs, and identify other less expensive means of entertainment. Binge spending once in a while is okay, budget permitting, but be careful not to overdo it through lifestyle pressures. The money that you’re spending on unnecessary items, such as excessive entertainment, is money that you could be using towards something that will make a real difference to your life.

• Start saving early:

One of the most common mistakes any working individual makes is thinking they will only start saving once they start earning a certain amount. Saving is one important financial discipline that should not be put off. Even if you start with a small amount, saving is a lifelong decision which impacts how early you can retire as well as having a go-to ‘piggy bank’ in case of a financially demanding emergency.

Purchasing a vehicle can be stressful for students and graduates, especially because they do not always have a credit history.

For those looking to buy their first car, the WesBank Graduate Finance offering provides graduates with competitive interest rates and credit history is not essential. The entire application process can be accessed and completed online.

Wesbank Graduate Finance is designed for graduates who:

Have a University degree, three-year diploma or NQF 6 qualification
Have graduated within the past three years from date of application
Are under the age of 31
Can provide proof of employment
Hold a valid driver’s license
Are South African citizens