December is, for many people, a great time to buy a new car. Many dealerships want to move old stock off the showroom floor, so there are significant discounts available. According to a report by TrueCar, you can save an average of 8.3% by buying a car during this period.
“People do a great deal of research when buying a new or second-hand car, but they tend to just want to offload their old car as quickly as possible,” says Vera Nagtegaal, executive head of online comparison website Hippo.co.za.
“There are a lot of things you can do to ensure that you get the best deal for your old car – which gives you more capital for your new vehicle.”
As a starting point, there are several legal steps that you will need to take: your licence should be updated, any traffic fines will need to be paid, and you will need a Road Worthy Certificate. Nagtegaal advises that you start processing all of these steps as soon as possible so that you don’t have to delay the purchase of your new vehicle when you want it to go ahead.
Financing and insurance
If the car is still financed and worth more than R250 000, you will need to give three months’ notice to your financing organisation or you will be charged penalties. Talk to your insurer to find out how to cancel insurance on the old vehicle and insure your new vehicle. You will usually need a purchase invoice to show that you own the new vehicle but inform your insurer in advance so that they can tell you the steps you need to take.
“Whatever you do, do not drive your new vehicle out of the dealership without having received a confirmation from your insurer that it is covered,” cautions Nagtegaal. “It would be devastating to damage or lose your new car without proper insurance in place.”
It is advisable to get the car in excellent condition before offering it for sale. “For a buyer, the financial burden of fixing dents or scratches may be a deterrent to purchase, and there’s a psychological advantage to be gained by selling a car that is well looked after,” says Nagtegaal.
She advises sending the car to a panel beater for a touch up of any minor body damage and having it valeted so that it is spotless and smells fresh. If you are a smoker, buy an air freshener and try to avoid smoking in the car in the weeks leading up to the sale.
The selling process
The next step is considering how to sell your car. You can sell it through the dealer, which works especially well if you are buying another car of the same make. While they will probably give you a good trade-in price to secure your purchase of the new car, this isn’t generally going to be as good as selling privately – but it saves you the hassle.
You can also sell through a used-car dealership or online car sites, or you can advertise privately through an online or newspaper classified.
Nagtegaal offers a word of warning for a personal sale. “Crime is unfortunately rife in South Africa, and this includes car purchase fraud. You may be opening yourself up to physical danger and theft by meeting prospective buyers at your home and allowing test drives.”
“While you might get a better price for your car by selling it yourself, the risks are high, and generally speaking, it is wiser to go through a reputable dealer or online platform when selling a car,” says Nagtegaal.
Buying a new car, and selling an old one, is an exciting process to go through, but there are lots of steps involved. Once you’ve made your mind up, don’t get caught napping on the admin because one unticked box can easily stop you from driving away with a new set of wheels.
Issued by HWB Communications Pty Ltd on behalf of Hippo.co.za