Tips for Getting Your First Second-Hand Car
First job, first home, first car — key milestones that any Singaporean is familiar with, and yet it’s not so easy to reach. Not only are cars pricey here, but Certificate of Entitlement (COE) costs are also rising. The higher the COE, the more it affects the vehicle’s economic repair value in the event of an accident.
All this considered a second-hand car might be a good option instead. Here are some tips if you’re looking:
1. Decide between PARF or COE
What’s the difference between PARF (Preferential Additional Registration Fee) and COE cars? Put simply, PARF cars are less than 10 years old, and COE cars are over 10 years old.
PARF cars are eligible for both PARF and COE rebates, while COE cars can only get a COE rebate. You can get an overview of what these rebates are here, and also find out a registered vehicle’s PARF/COE rebate on Land Transport Authority’s website here.
This may make PARF cars seem like a better choice, but COE cars tend to be more budget-friendly. Due to their older age, there’s more room for price negotiation — but you may also need to factor in higher maintenance costs. This is where Tip #2 comes in handy!
2. Plan your questions
Before you go for viewings, it’s wise to think about what you want to find out and make a list. Some essential details to ask about include how many owners the car has had, any modifications done, and its accident history.
This helps you understand the condition of the car better — for example, if the car has had several owners, it may indicate that the car has chalked up a lot of mileage and may cost more to maintain in future. If modifications have been done, it’s important to know so that you can get the necessary insurance coverage. Be sure to ask for documents to ensure these alterations are legal!
This handy checklist from Consumers Association of Singapore (CASE) is a useful guide for you. Do not be shy or afraid to be thorough in understanding the car’s condition — always insist on doing a test drive!
3. Calculate the depreciation
Another reason it’s expensive to own a car in Singapore is how fast it depreciates. The depreciation determines how much you can sell it for later.
Make sure to calculate the depreciation of a second-hand car before deciding whether to buy it. Simply subtract the minimum PARF amount from its original selling price. Then, divide it by the number of years it has left. The lower the depreciation, the better.
4. Watch out for gimmicks and tricks
With the information overload in the search for a car, it can be easy to miss extra charges, hidden as “admin fees”. This is just one out of numerous sales tactics to be mindful of.
Another common strategy is when dealers advertise an unavailable car, and then eventually promote a similar one at higher cost after you have expressed interest. It never hurts to be extra vigilant — avoid signing blank forms to prevent fraud, and always get the agreement clearly spelt out in black and white.
It can be tricky identifying reliable car dealers. Here are a few signs to look out for:
- Different payment plan options. A good car dealer is likely to be more flexible and sincere in helping customers pay without overextending themselves.
- Referrals. Feel free to ask for referrals to past customers, their willingness in providing this is also an indicator in itself.
- Validation on car listing sites. Do your research and trawl established websites such as sgCarMart.com to see if the dealer is considered credible there.
After all the time and effort in choosing the right car, don’t forget to protect it! MotorMax Plus offers comprehensive coverage against accidental damage or loss, and even covers medical expenses for the authorised driver and passengers. That’s not all — MotorMax Plus also allows you to go to any preferred workshop in the event of an accident!
The best part? All this coverage is available for second-hand cars too! Find out more about MotorMax Plus.
