Used Cars in India

Used cars in India can be purchased through three avenues – directly from the car owner, franchised pre-owned dealer and a used car broker.

Purchasing a used car in India from the first owner of the car is considered the most reliable option from these three options, more so when the car owner is known to you. Besides, it is the most cost-effective since there are no brokerage charges involved during the purchase of the used car. It also gives you the opportunity to negotiate further and perhaps fix a better deal for yourself.

In contrast, getting in touch with a used car broker or franchised pre-owned dealer will give you a wide variety of choices to take your pick from. You can browse through newspaper classifieds and websites that deal with used cars in India and shortlist ones that suit your desired specifications – features, car brand, budget, etc. Further, you can closely check and evaluate the features and present condition of each of the shortlisted cars before taking a final call. The quoted price will be comparatively higher than what you will get when you purchase the same used car directly from the car owner. However, there will also be scope for negotiating on the quoted price. Transparent paperwork is an integral part of buying a used car in India from a registered professional car dealer or broker.

Besides being able to access a variety of used cars from professional dealers and brokers, there will be a greater reliability of the condition of cars. What’s more, you also receive complimentary benefits like service packages, which will not be the case when you buy a used car directly from the car owner.

You can get a used car’s history either online or offline, as per your preference.

• Budget: The budget that you would like to keep aside for a car depends on your financial objectives. If your budget is Rs. 4 to 5 lakhs or less, it’s best to opt for a well maintained used car.

• Preference: A purchaser would be able to buy a higher variant of a used car at the same budget with which he/she can buy a new car of a lower variant. It depends on the purchaser to decide his/her priorities.

• Performance vs. new car: A used car in India that performs better than a new car that is not as good – the choice again lies with the buyer.

• First-time buyer: When buying a car for the first time, some may not mind getting a used car in India. On gaining enough knowledge from the first-time experience, he/she can move on to purchasing a new car.

• Long term or short term investment: For car buyers who prefer opting for frequent upgrades, purchasing used car in India may be more suitable for his/her budget. A new car may be a more suitable option for purchasers looking for a car with a long term objective.

• Availability: Hatchbacks that are in high demand usually have a waiting period of about half a year, while sedans and SUVs may have a waiting period that is as long as 2 years. On the other hand, used cars in India will be available as long as you finalize the purchase. For car buyers who prefer getting their hands on the wheels as soon as the purchase is over, used car are the preferable option.

• Variety: The choice of used cars in India will be restricted in comparison to new cars. For buyers who don’t mind choosing from a restricted choice, considering the used car is in fairly good condition and suits the budget, it is a fair option.

• Interest rate: Loans for used cars have increasingly become popular in India. However, while banks and financial institutions generally offer an interest rate of 12% on loans for new cars, the rate of interest on used cars in India usually is 14%. For buyers who don’t mind a higher interest rate, buying a used car is a viable option.

• Know your budget: Have a clear idea about your budget. This will help you know the car brand and variant that will be available within your budget. You can then start looking out for used cars accordingly.

• Do a thorough research: Check on the existing cost of the car brand that you wish to purchase from across channels. Know about the car model - expected technical glitches, feedback of its features and specs, pros and cons of buying it second-hand, etc. Read up on the information from websites, internet and reviews, and talk to existing and previous owners of the car brand and variant.

• Do a background check of dealers/brokers: Make sure you go for a professional dealer or broker that specializes in used cars. Not all dealers and brokers are certified and reliable. Talk to several dealers about the same car variant and analyse whether you have received the same information from all of them. Apart from research, trust your gut regarding the genuineness of brokers and dealers.

• Check out the used cars physically: Once you have finalized on the brokers and dealers and have got leads of used cars of your preference, you have to check out their features and present condition physically. Study the condition of features and specifications of the car variant - interiors and exteriors, types, underbody, air conditioning, electricals and lighting, seats, airbag deployment, etc. Closely analyse the extent of wear and tear. Drive the car yourself or get an expert to drive it. If you detect a glitch, try negotiating the price.

• Consider the age of the used car: After three years of use, major repairs are often required, in case the car is not driven carefully. Therefore, its reselling price also sees a sharp drop. A high mileage is a clear indicator of substantial wear and tear. It is often recommended that buyers steer clear of purchasing used cars that have been used for over 5 years. The more the age, the greater will be the depreciation in condition. Not only do the chances of getting spare parts decrease, they also become increasingly more expensive. This implies that the buyer would have to shell out more in the maintenance of the used car after purchasing it.

• Negotiate well: Whether it is from the car owner or from a dealer, don’t miss negotiating on the quoted price.

• Paperwork: The purchase process for used car in India cannot be complete without transfer of ownership. This requires you to arrange for the necessary documents that will have to be submitted for registration formalities. Emphasize on the documents – original purchase invoice, Registration Certificate (RC), pollution certificate, vehicle insurance papers and road tax receipt. In case the first owner had taken a car loan, you also have to ask for Form 35, and No Objection Certificate (NOC) from the relevant finance company. If the colour or registration certificate or any other body part was changed while the car was being used by the first owner, details regarding these also have to be updated in the registration certificate. Also, check whether the car has a history of accident.

Below are some of the top car models under the ‘Used Cars in India’ category:

• Maruti Swift
• Maruti Dzire
• Maruti Wagon R
• Maruti Alto
• Hyundai i20
• Honda City
• Honda Amaze
• Honda Jazz
• Volkswagen Polo
• Volkswagen Vento

Here are some tips for you to fetch the maximum price for your car when you put it up for sale:

• Get the repairs done: When a prospective buyer checks your car, he/she will have a close look at its features and specifications, and evaluate the existing condition before taking a decision. Therefore, it is necessary for you to check all the car parts and get the repairs done before you put it up for sale. Also, check your car for scratches and dents and repair them as much as possible as these bring down car prices to a great extent.

• Deep clean up: Get a professional to thoroughly clean up your car from exteriors and interiors.

• Quote a higher price: Negotiations are an integral part of the purchase process. Keeping that in mind, quote a price that is comparatively higher than the prevailing market price of your car variant. This will ensure that you get a fair price for your car even after negotiations.

• First impression matters: When you post an advertisement for your car online, make sure that they are visually appealing. Also, make sure that you post images from various angles and that of the prime car parts, so that they get an idea of what to expect. This definitely wouldn’t seal the deal, but would create a positive impression about the car.