5 Things to Consider Before Purchasing a Car in India

5 Things to Consider Before Purchasing a Car in India


Purchasing a car is an important and expensive decision and requires careful consideration. You may be wanting to buy a vehicle to ease your travel or have a better lifestyle, whatever the reason you need to ensure that you get the best value for your money. Some major factors to consider while buying a new vehicle are its features, price, resale value, financing options and mileage. A major consideration is the funds available with you and the need to take a personal or a car loan.

Some major considerations before you decide to buy a car in India are:

Your Budget

Car purchase can be an expensive decision especially if you wish to go for a high-end model. Whichever model you wish to buy you need to do adequate financial planning to fund its purchase. So, the first thing you need to consider is your budget and your plans to fund it. You may have some savings with you, but often it’s quite convenient to combine your savings with a car loan or a personal loan to fund some portion.

The Purpose

You may need a car for daily travel on the city roads or excursion purposes. Depending on the roads on which you wish to use your vehicle, the choice of the make and model can be made.

Features and Technology

Some of the features that will help you finalise your purchase includes the technology, the features- both safety and utility-wise. Cars with adaptive headlights, automatic parking and backup cameras are highly useful but add to the overall cost. Do go for a test drive to check whether the seats are comfortable and spacious, there is adequate legroom and storage space.

Consider Total Ownership Costs

In addition to the showroom price of the car, you need to consider the price of insurance, the fuel, and maintenance costs associated with a vehicle. The more expensive models tend to have a higher insurance charge. Do check for the fuel efficiency of the vehicle and the availability and price of its replacement parts.


Auto loans are easily available and quite often the dealers have tie-ups with banks to provide loans to car buyers. However, they all are secured against the vehicle itself and the ownership transfers to you only after you have paid off all your dues. To avoid this,you can go for an unsecured loan. But do check the personal loan interest rates, compare them and make a decision.

Check Your Credit Score

The basic criteria for any loan whether a home loan or top-up loan or a personal loan is your credit score. So, if you wish to fund your car purchase via a loan, ensure that you have a credit score of above 700. This can be done by paying off all your dues on time and not leaving any outstanding balances.

Shopping for a car loan or personal loan should be started early to know beforehand the kind of interest rates prevailing and the amount one can expect to borrow. Comparing personal loan interest rates can help you determine the total cost and make an informed decision.