Graduating university is a milestone achievement. You have spent several years studying a topic that you care about and you are now ready to enter the real world. The first thing you will need to do is find a vehicle to take you to and from your new job. But this can be difficult if you have recently graduated and do not have a credit history. If you are looking for the perfect wheels, you can apply for car finance directly with an institution. Many banks offer specialised vehicle finance because they realise how difficult it can be for recently-graduated students to apply. So, if you are interested in finding your dream car, read on below for some top tips on how to apply for graduate vehicle finance after university.

Budget for the total cost

When you are looking for a new car as a graduate, you might only be looking at the price tag.   But you should be looking at both current and future expenses. This includes the monthly instalments, the insurance cost and petrol expenses. You can use a vehicle finance calculator to figure out your affordability. Your budget should be based on how much money you will be earning each month or how much money will be coming into your bank account each month, after expenses. Remember to factor in maintenance, such as oil changes, tyre pressure and alignment and a regular service. Once you have your budget, you can start looking into applying for graduate car finance and searching for your new car.

Consider a deposit

If you are able to offer a deposit to your lender, you should do so. This will help to lower your monthly costs and allow you to choose the car you have been dreaming of. A deposit is not mandatory but should be a consideration for any new graduate who wants to buy a car after university. Your deposit should not be debilitating to your finances, but it should be enough to show the bank you can handle your money and that you will be able to repay the monthly amounts. For example, you could offer a 10% deposit on a car that costs R115 000, which will be R11500. Your repayments will go down significantly with this amount, making the car an affordable purchase and a worthwhile investment for graduates with no credit.

New, used or pre-owned?

Before you go out and start looking for a car, you should think about whether you want to buy new or used. A new vehicle offers a full warranty, all the new technological extras and a full inspection and history. But it does experience depreciation a lot quicker than a used or pre-owned vehicle. A used vehicle is more affordable, but it does not offer a warranty and might have undergone massive repairs and replacements due to an accident. The best option for any graduate is a pre-owned vehicle. This offers the best of both worlds, in that they are affordable cars that are like-new and many of them are still under warranty. Be sure to ask for the certificate for any pre-owned car, and ensure it is from the manufacturer and not from the dealership.

Don’t forget to do your homework

Now, you might be dreading doing more research after just completing a degree, but it is worth it to know what cars and dealerships are out there when looking for a car. Start by doing your research online, looking for models and makes that appeal to you and then looking for dealerships that offer these cars. Another effective way to garner more information about the cars you are interested in is to go to the dealership website and take a look at their price offerings. This way, you will be able to compare prices and find one that suits your budget. You can also go to each dealership in person and ask for a quote based on your budget so you can compare numbers and get a feeling for how each dealership operates.

Always ask for a test drive

Once you have broken down your list of dream cars into two or three options, you will need to go to the dealerships to ask for a test drive. This is an important part of any car buying process as it will show you how the car handles traffic, different types of roads, and how comfortable it is for you as a driver. Make sure you test drive the car without the radio on and listen for any strange noises when you stop, start and pull off. Take note of the steering and if the car pulls to the right or left at all. You should ask to take the car through both heavy and light traffic to truly test how it runs. If you do not take the car for a test drive, you will not be able to learn anything about it and might end up making a purchase that costs you more in the long run.

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