Tips for first-time car buyers in Singapore

Buying a car in Singapore is an expensive commitment, and if you're thinking of making the leap into car ownership here for the first time, the process can feel somewhat intimidating and complicated, what with the many terms, jargon and regulations to contend with.

Nevertheless, if you feel like you're ready to make the leap, CarBuyer Singapore is here to help you figure it all out with some handy tips for the first-time car buyer, so that you don't feel lost or short-changed.

What type of car do you need?

First of all, you need to decide what kind of car you need, based on your usage patterns and what you'll mainly use the car for. 

For instance, if you're a new driver, you might want to go for a small hatchback that's easy to drive and park.

If you need a bit more space to ferry your friends and family around, you may want to consider a larger sedan, MPV or SUV.

If you're a swinging single or young couple with no kids and few commitments, you could perhaps think about a sporty coupe or convertible.

Or if going green and saving fuel is important to you, you might want to opt for a hybrid or electric vehicle instead.

Budgeting

After you've decided what kind of car you're going to buy, now it's time to set your budget.

How much you have to spend will help you narrow down your options further, and point you towards whether you can afford a new or used car.

It's not just the outright amount that you have to consider.

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Unless you are cash rich and are going to pay for your car in full upfront, chances are you are probably going to have to take a car loan.

So you have to work your sums out, looking at the downpayment and your monthly instalments.

Do take note that there are rules governing borrowing for car loans in Singapore.

If the Open Market Value (OMV) of the car you're intending to purchase is less than or equal to $20,000, you can loan a maximum of 70 per cent of the car's value, repayable over a maximum period of seven years.

Whereas if your car's OMV is more than $20,000, the maximum loan amount is 60 per cent of the car's value, repayable over seven years.

Do add in a buffer in your budget as well, to account for fluctuations in Certificate of Entitlement (COE) prices, as well as other expenses you may incur such as insurance or road tax.

Should you buy a new or used car?

Now that you've decided whether to opt for a new or used car, here are some tips to aid you further in your car buying journey.

New car

If you are buying a new car, it would be great to bring along someone experienced to help you negotiate with the salesperson.

You should also take a test drive to see if the car suits you before making your decision.

Once you have finalised your choice, make sure all costs are put down in writing, so that there would be no hidden surprises during payment. 

Used Car

If a new car is priced out of your budget and a used car is what you're looking for, you will need to take more precautions.

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Aside from the above tips that apply when buying a new car, you also need to be extra observant when you're viewing the car to look out for any damages or overly worn parts.

In addition, stay alert for any unusual noises or abnormal functionality of the car when you are taking it for a test drive.

Last but not least, if the seller agrees, you could arrange to have a mechanic look at the car before you commit to the purchase.

Whatever choice it may be, be it a new or used car, buying a car in Singapore is a huge commitment.

This article was first published in CarBuyer.