According to a report by Mordor Intelligence, the market for used cars is estimated to reach 75 million USD by 2023. Acquiring a second-hand car is an option which interests to a lot of Indians. Buying a used car has many benefits such as, spending less money while buying a new vehicle, reduced insurance cost, lower interest rates, etc. However, buying a second-hand car is a complex process which requires the buyer to verify many factors which could affect the quality of the vehicle.
Verification and Documentation of the Car.
Before purchasing a car, you must ensure that you have checked the vehicle thoroughly by a mechanic or an authorized entity. If any of the parts are defective then you can ask the owner to get that part fixed.
In addition to the verification of documents, you must also verify the following:
If the car has insurance or not. Through the insurance papers, the buyer can identify if the car has previously been in accidents or not and also if it is eligible for any claims. This can be checked through the No Claims Bonus. The higher the value of NCB, the better it is for the buyer.
Whether the chassis and engine number of the car are the same as mentioned in the RC.
Whether the filters are in working condition. The condition of the filters shows the condition of the vehicle.
Whether the braking system of the car is in good condition. If you hear a squeaking sound or face any difficulty in braking then you can ask the previous owner to change the rotors.
If the tyres are in good condition.
Transfer the Documents of the Car to Your Name
You must ensure that the documents of the car have been transferred to your name. The documents that you need to transfer to your name are:
RC (Registration Certificate)
Fill Form 29 and Form 30 with all the necessary details and submit it to the RTO to transfer the vehicle to your name. If the car has been registered in a different jurisdiction then NOC must be obtained from that particular jurisdiction. After 45 days of submission of the forms, a new RC (Registration Certificate) with the name of the buyer will be sent to the registered address.
You must transfer the insurance policy to your name even if the RC has already been transferred to your name. You can't claim the insurance if the policy is in the name of the previous owner.
The receipts of Form 29 and Form 30 can be submitted for transferring name in the insurance policy from the seller to the buyer of the used car. You can take the help of the officials of the insurance company from which the insurance was bought.
If the car didn't have an insurance policy before, then you can buy a new insurance policy registered in your name
The No Claim Bonus
For transferring No Bonus Claim (NBC), you need to pay the difference amount on the NCB account for a period of the policy balance or buy a new insurance policy altogether. For example, if the previous owner of the vehicle was accruing a discount on the NCB, it can't be availed by you and you'll be required to pay the full amount. If you've owned a car in the past, the NCB applies only if the company issued a reserving letter while you bought the insurance. You can either buy the new policy by using this letter which could get you the discount or you can adjust the difference in the NCB balance between the previous seller and your NCB amount.
Fixing and Cleaning of the Car Before You Drive It on the Road
The first things that you must do before driving the car on the public roads are:
Cleaning the exterior and interior of the car.
Changing the fluids and oil of the car.
Repairing and fixing the parts of the car which are malfunctioning.