Things To Know While Buying A Second-Hand Car in India

In a recent report from Sullivan and Frost, the statistics showed that the number of second-hand car purchases in India is equivalent to the number of new cars purchased. Purchasing a second-hand car is an option which appeals to a lot of Indians. In addition to the benefit of spending less money while buying one, there are other advantages too. However, purchasing a second-hand car is a complicated process which requires a lot of things to be checked.

  • Verification of the car and its documentation:Before you purchase a car, ensure that you get it thoroughly checked by an able mechanic. In case any of the parts are malfunctioning, you can ask the owner of the vehicle to get it fixed. In addition to this also verify:
    • Whether the car has an insurance cover or not. Via the insurance papers, the buyer can verify if the vehicle has suffered any accidents in the past or not and if it is liable for claims. This can be checked by noting the No Claim Bonus (NCB). The higher the NCB, the better. 
    • If the chassis number and the engine number on the car are the same as the one mentioned in the registration certificate.
    • If the filters are in proper working condition or not (For the filters of the vehicle to be working properly they should be oiled and cleaned regularly). The condition of the filters also indicates the condition of the vehicle.
    • The second-hand brakes of the car. To test the brakes, drive on a road with little to no traffic at a speed of 40 to 50 kilometres per hour. If you can hear a squealing or pulsating noise or a vibration, it means that the rotors need to be replaced.
    • Check the condition of the tyres. All the tyres should be equally worn.
    • Check for any dents, rust or any other damage in the body of the car.     
  • Transferring the documents in your name:  Ensure that all the documents are transferred in your name. These documents are:
    • Registration certificate: Fill Form 29 and Form 30 with complete details and submit it to transfer the registration of the vehicle in your name. The forms have to be signed by the purchaser and the seller of the second-hand car. If the car has been registered under a different jurisdiction, a No Objection Certificate has to be obtained. The new registration certificate with the name of the seller is obtained within 45 days of submissions of the forms.
    • Insurance policy: Transfer the insurance policy in your name as despite the registration certificate is in your name,  the insurance policy being in the name of the previous owner of the car will nullify the policy altogether.
      1. In case the previous owner of the car has an insurance policy, the receipts of Form 29 and 30 can be submitted for transfer of name in the insurance policy from the previous owners to yours. You can take the help of an insurance broker, agent or the company from which the policy was bought.
      2. If previously the car did not have an insurance policy, you can buy a new insurance policy after the car has been registered in your name.
      3. You can also buy an insurance policy for the car in your name. Buying a brand new car insurance in your name allows you to select the price and the company you want to opt for.
    • The No Claim Bonus: For transferring the No Bonus Claim (NBC), you have to pay the difference on the NCB account for the period of the policy balance or buy a new policy. For instance, if the previous owner of the vehicle was enjoying a discount on the NCB, it cannot be transferred to you as you would have to pay the full fee charged for it. If you have been an owner of another car in the past, the NCB still applies only if the company from which you bought the policy issued you a reserving letter. You can either purchase the new policy using this letter which might get you a discount or adjust the difference in the amount in the NCB balance between the previous sellers and yours.
  • Fixing and cleaning of the car before you drive it on the road: Some of the things that as the new owner of the car you can do are:
    • Cleaning the interior and the exterior of the car.
    • Change the oil and fluids of the car.
    • Fix anything that requires repair in the car such as the spark plug etc.
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