In the times of the pandemic, using public transport seems daunting, and everyone is trying to avoid it at any cost. Therefore, most people who didn’t own a four-wheeler are now planning to buy a car. But this crisis has led to widespread pay cuts, job losses and a fall in the global economy. Everyone is trying to cut on expenses in these trying times, and therefore the concept of buying used cars is trending. Buying a used car is the most affordable option at this point to meet your commuting requirements. But it is critical to keep a check on the following before taking a used car loan:
Check the Latest Interest Rates:
One of the most essential things before deciding on a loan for a used car is to check the latest interest rates. Due to the pandemic, there will be changes in the interest rates offered by the lending institutions, and so it is important to research properly about all the lenders. You have to compare and contrast the interest rates offered by all the institutions you are considering to take a loan from. It is also to ensure that you get the best deal for loan for used car and do not pay higher. Since the total amount for a used car will be lower, it will lead to low monthly instalments that you will need to pay.
Short Term Loan:
You should avoid taking longer tenure loans and go for short term loans if you can afford to pay monthly instalments. Although the instalments will be higher in a short term loan, the interest rates will go down, and you will pay a lower cost which is not the case in the long term loans.
Check for Expenses and Unpaid Loans:
It is vital to check if there are any extra expenses you might be asked to pay like the processing and pre-closure fees. It is recommended to watch out for any unpaid loans attached to the used car you are buying.
Along with checking for the latest interest rates, you will also have to check and verify the documents while taking a used car loan. These include the registration certificate, the invoice for the used car, insurance documents, the notice of the car ownership. These are incredibly important and make sure you do not take the used car without these documents.
Insurance coverage for a used car is equally as important as a brand new one, and it is advised that you also take insurance. The insurance must be in your name so get it transferred. If in the 14 days from buying the insurance, it is not transferred then any loss and damage will not be covered by the insurance company.
Therefore, it is exceptionally crucial to check for the latest interest rates while taking a used car loan along with the factors mentioned above like the insurance, documents you need to check for, the expenses and unpaid loans on the vehicle.