All you need to know about buying a used car on finance

Taking that first step towards buying a second-hand car on finance can be scary but it doesn't have to be. We take a look at the basic steps that you will follow when purchasing a used car on finance.

Lawrence Minnie

13 Sep 2022 · 22:06Buying a Car

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Finance checklist

There are not many South Africans that can afford to purchase a new car off the lot and as such most car buyers will end up in a used car at first. This undertaking does not have to be daunting and scary if you know what to expect and what will be expected from you.

We've condensed the steps that you will need to follow during this transaction and hope that you find what you are looking for.

Know what you want

This is the first step in your buying journey, decide what you want to buy and begin hunting for that elusive bargain. Be aware of how your choice is doing on the market in terms of popularity, availability, and price. Know what you are going to be paying for that model on average and what your chances are of finding one in good condition. Also, keep in mind that most finance houses will not finance a vehicle over 8 years of age and frown upon vehicles over a certain kilometer range.

Know what you can afford

Knowing what you want is one thing knowing if you can afford it is another. Make sure that once you have decided on a car and have found one, ensure that you can pay the monthly installments and have budgeted for ownership costs. You can get your vehicle finance pre-approved or you can wait until you find one and have the dealership do the application for you.

Get your paperwork in order

Before going ahead and doing the application, make sure you have your paperwork together to facilitate the application. Have copies of your ID, driver's license, proof of employment and earnings, and proof of address. The dealership will apply to a number of finance houses and will let you know what kind of offer they will come back with, in terms of interest rates and payments, and then it's up to you to decide which agreement you take.

Insurance cover

Once you have signed the agreement and the dealership has processed the sale, you will need to provide proof of insurance before the dealership will release the car to you. This can be in the form of a basic third-party fire and theft policy or a fully comprehensive cover that protects everyone but you will have to provide this proof before driving away in your new to you car.

Any information herein is not intended nor does it constitute financial, insurance, tax, legal, investment, or other advice. Before making any decision or taking any action regarding these please consult a suitably qualified professional.

For more information of vehicle sales you can try a number of the free finance tools on our site:

https://www.autotrader.co.za/car-finance-calculator

https://www.autotrader.co.za/value-my-car

https://www.vehiclecheck.co.za/

https://www.autotrader.co.za/sell-my-car

Written by Lawrence Minnie

Lawrence has been involved with motorsports for almost 30 years. Whether it's two wheels or four, if it has an engine, he will try to race it. This love of motor vehicles has led him to ride, drive, film, photograph, and write about his passion. Freelance for a while but now a permanent fixture on the AutoTrader team for over 7 years, Lawrence contributes written, photographic, and video content for AutoTrader and AutoTrader Bikes.Read more