Applying for a Car loan
Buying a new car is a dream come true for many people. A normal priced car may not be as big an investment as a house. Nevertheless, buying a car can be quite a strain on the pocket for the common man and more so if you opt for a high end car. Although car loans are easily available today, it becomes important to plan for this purchase, as ultimately the car loans will also need to be serviced. Often people ask themselves when is the right time to buy a car. The right time of course varies from person to person. However, there are some cases when you can get good deals on your car purchase. Let us look at some instances when it is the ideal time to buy a new car:
Be financially prepared:
First and foremost, you should be financially prepared to buy a car. Purchase of a car and servicing the EMIs can be quite a financial strain. For example, consider you decide to buy a car worth Rs. 6 lakhs and make a down payment of Rs. 2 lakhs. This means you opt for a car loan of Rs. 4 lakhs, at say an annual interest rate of 12% per annum and loan period of 60 months. The EMI you will have to pay is close to Rs. 9000. Reduce the down payment or tenure and the EMI shoots up. For an average person, this can be a substantial cash outflow on a monthly basis, not to mention the initial down payment he has to put in. This means it always makes sense to consider buying a new car when you are financially prepared, and when you are sure you can afford to meet the EMI payments.
Festive discounts:
India as a country celebrates festivals in every small way possible. Car manufacturers and dealers are not far behind when it comes to celebrating festivals by offering discounts and offers during festival season. In addition to reducing the price of car, they also give freebies and other offers which can be availed during the festive season. Banks also sometimes offer a lower interest rate or waive processing fees on car loans during this season. Hence, it might be a good idea to wait for festive discounts when you think of buying a car.
Launch of new models:
If you are keen on the model or variant you wish to purchase, it is a good idea to wait for this to be launched. Sometimes, it is seen that car manufacturers stagger the launch of a particular model. Sometimes, the model is announced much in advance, but the actual launch takes place after a few months. Although this may not be applicable to everyone, yet if you are among those who is particular on getting some specific features or who wishes to purchase a certain model, then you should wait till the launch.
When your old car needs a change:
When you already have a car and it is time to change this car for various reasons, it may be a good time to buy a new car. Many dealers offer exchange schemes, which will reduce the price you pay for the new car. This is very common is lean season when there is a need to push inventory and increase sales. During this time, you can also get attractive exchange offers. Therefore the ideal time to buy a new car can also be when your old car becomes too old for you.
Month end:
During month end, dealers and salespersons are under a pressure to meet targets. They look at ways of increasing sales and revenues. Therefore, it is usually seen that as the month ends, the discounts and offers are higher on certain car models and variants. As a result, sales numbers are also generally more towards the month end than the beginning of the month. This may not be true in all months though. If the demand for cars is high, then dealers may choose not to give discounts in the month end. However, it may be worthy to explore the trend and discounts when you decide to buy a car, and push your purchase decision to the end of the month.