In the face of rising living costs, fluctuations in the interest rate and high fuel costs, WesBank recognises the increasing need for consumers to look at purchasing a cost-effective pre-owned vehicle as opposed to a brand-new model. The bank aims to provide valuable advice to prospective buyers on navigating the pre-owned market and avoiding common pitfalls.
Understanding a pre-owned car’s history remains crucial when considering a purchase. Prospective buyers are advised to gather as much information as possible about the car they have their eyes on, paying attention to key factors such as:
- The number of previous owners
- Total mileage
- Vehicle age
- Possible accident history
- Service history
While it may not always be possible to obtain every detail, building a comprehensive profile helps minimise the risk of buying a problematic vehicle.
Assessing a pre-owned car’s market value is equally important, and various factors such as age, mileage, service and ownership history can impact its price. For instance, a three-year-old car with 60,000 kilometers on the clock, a full service history, and a single owner will generally be worth more than a similar car with no service history.
To ensure a transparent and secure transaction, WesBank advises potential buyers to conduct business with reputable, approved dealers, preferably those with National Automobile Dealers’ Association (NADA) and bank approval. Such dealers are better positioned to provide reliable information about a vehicle’s history as well as aftersales support.
Buyers should remain cautious if they come across a vehicle advertised at a price significantly below its market value. Such instances might indicate issues like high mileage relative to the year model, previous accident damage, or a history of serious mechanical problems.
Another red flag for buyers is encountering a vehicle labelled as “code 3,” an insurance term denoting a vehicle that is “permanently unfit for use” or one that has been stolen and recovered. WesBank will not finance these vehicles, regardless of the reason for their classification.
To make an informed decision, buyers are encouraged to have a knowledgeable person accompany them to assess the vehicle’s condition and take it for a thorough test drive. Seeking the expertise of a trusted mechanic to examine the car before finalising the purchase is also a wise move.
Checking whether the pre-owned car is still under warranty or within its maintenance or service plan period is essential. If not, it is advisable to consider purchasing an extended warranty, service, or maintenance plan. These can be obtained through the dealership’s Finance and Insurance (F&I) liaison, who will facilitate the process.
Affordability is a significant factor to consider, encompassing costs such as insurance, fuel, and wear-and-tear maintenance items. Particularly for older vehicles, fuel consumption and maintenance costs are essential considerations. Buyers should also be aware of the replacement costs for consumables like tyres, which can impact the overall maintenance budget.
WesBank reminds all potential buyers that reputable dealerships have F&I specialists who can tailor finance agreements to meet individual needs. Engaging with the dealership’s F&I consultant during the finance application process ensures that customers fully understand all documentation before signing.
As the automotive market continues to evolve, WesBank remains committed to supporting buyers in their journey to find the best value and quality in the pre-owned car market. By following these guidelines and collaborating with trusted dealers, buyers can make informed decisions and confidently invest in their next pre-owned vehicle.
Kimono Goddess
Roger Boniface is the founder of EDISIM, a training provider that uses simulations to offer real-world learning experiences in the classroom. In under three years, he has managed to integrate his business simulation concept into some of Africa\’s top business schools. He lectures at Wits and GIBS in South Africa and Strathmore Business School in Nairobi. Named as one of the 30 under 30 Africans to watch by Forbes, Boniface is also the founder of Artson, an event company that hosts art and wine tasting experiences, and he took on JCB, a small textile wholesaler. Although he didn\’t launch JCB, he has increased the annual turnover to R13 million in 3 years.