What to Know When Buying a Vehicle

CAMERON KLASSEN CONSIDERING THE BANK of Namibia’s monetary policy committee’s decision to keep the repo rate at a historic low of 3,75%, and the introduction of extended repayment terms, now is the ideal time to buy a vehicle.

However, as with any purchase, planning is essential.

Below are some hints and tips when buying a vehicle:

• Key decisions: Customers need to make a decision based on their needs. A question to start with is what the main purpose of the vehicle is likely to be: Is it for frequent off-roading, mostly city driving, or could it be for a combination of purposes?

Considerations such as fuel consumption, vehicle safety features and carbon emission may also factor into your list of priorities.

• Vehicle preference and test-drive arrangement: Once customers have identified a few vehicles that may fit their needs and budget, test driving the car is often the next step.

Customers often want to get a feel of the car, and how it performs in a city setting and on the open road.

Once they have made up their minds, they can approach their bank directly for financing.

• New versus pre-owned vehicles: Can the customer’s budget cater for a new or used vehicle? To consider a pre-owned vehicle may be an option.

There are advantages and disadvantages to both options, and customers should take the time to weigh the alternatives carefully and ask reputable dealerships questions, backed by some research.

Factors to consider are mileage on the vehicle, its maintenance and service history, the expiry date of the existing service plan, the number and nature of incidents the car has been involved in, as well as how many previous owners any one particular vehicle has had.

Often, depending on the needs of the prospective owner, a pre-owned vehicle is a good option.

• Research: Knowledge is power. The internet is an excellent resource for researching the specifications of a vehicle. Customers often use this research to specify the make-up of their desired vehicle to get quotes from a dealership.

At this point customers should consider the instalment and insurance price and maintenance cost of the vehicle before committing to making the offer to purchase.

• Budget and financing: Finances when looking at purchasing a vehicle should be looked at realistically. Buying a vehicle is a long-term decision, and there is more than just the purchase price to take into account.

Annual vehicle-licensing fees, maintenance, insurance, fuel, repairs, parking, and wear-and-tear items such as brakes and tyre expenses should also be considered.

These items do not resort under service plans or your vehicle’s warranty. Using a vehicle finance calculator is a great way to calculate and project the car’s monthly instalment payments.

Once done, a customer can weigh it against their budget, but should note it is only an indication of the instalment, and not all costs are included.

• Savings considerations: Customers should also be advised to keep a separate savings account for expenses not covered by a service plan or parts guarantee.

• Close the deal: After completing research, assessing affordability and having approved tailor-made financing for the vehicle, the deal is nearly done.

Customers are strongly advised to focus on carefully reading their contract to understand the terms and conditions of any financing agreement, and service and warranty agreements, and to ask questions.

Once customers are empowered and comfortable with all the information required, they can drive off in the vehicle of their dreams.

* Cameron Klassen is a senior sales adviser at Bank Windhoek’s vehicle and asset finance department.

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