How to Buy a Car in India
Buying a car is a big deal — and not just financially. For many of us, it’s a milestone filled with emotion, pride, and years of dreaming. But the journey from “I want a car” to “I got the keys” can feel overwhelming. There’s so much noise: features, dealers, financing, petrol vs diesel, online reviews — where do you even begin? Don’t worry. In this guide, we’ll walk through everything and help you feel more confident every step on your way towards purchasing a new car. Start With Yourself — Not the Car Most people begin their search by looking at car models. That’s like shopping for clothes without knowing your size or occasion. Instead, ask yourself: How will I use this car? Is it mostly for city errands, weekend trips, or highway drives? Do I drive alone or with family? Am I comfortable with a manual transmission, or do I need an automatic? You don’t need to know the answer to every question right away, but reflecting on your lifestyle will help narrow down the sea of choices. You’re not just buying a machine — you’re choosing a partner for your daily life. Budgeting: It’s Not Just About the Price Tag You may already have a figure in mind. Maybe ₹8 lakhs, maybe ₹20. But what does that number really include? Here’s the thing: the ex-showroom price is just the beginning. Add registration, insurance, extended warranty, accessories, loan interest (if you're financing), and yearly maintenance — and you could easily overshoot your budget. The key is to set a range you’re comfortable with, not a fixed figure you’re emotionally attached to. Can you apply for a car loan for that amount? Also, never share your exact budget with a dealer. Once they know it, all negotiation goes out the window. New or Used? Be Honest With Yourself Buying a used car is often a smart financial decision — especially if it’s your first car or you're on a tighter budget. To make it even more easier you can apply for a used car loan. New cars lose the most value in the first 2–3 years. That means you can find a well-maintained, certified used car with low mileage for significantly less — and still get many of the same features and performance. However, buying used requires extra due diligence. You’ll need to run through check a few things to ensure the vehicle condition. If you’re unsure, bring a trusted mechanic or a knowledgeable friend with you. Lastly you can check out the benefits offered by a used car loan so that you won’t miss out in any. Don’t Test Drive Just for the Sake of It A test drive is not just a formality. It’s your chance to listen to the engine, feel the suspension on a speed bump, test the brakes, and see how the car handles in tight turns or traffic. Don’t let the salesperson rush you or fill your head with specs while you’re driving. Take your time. Adjust the seat, drive in silence for a minute, and ask yourself: “Can I live with this car every day?” Dealers Will Smile — But That Doesn’t Mean They're Your Friends You’ll meet warm, well-spoken salespeople who’ll say things like “This offer is just for today” or “Only two units left.” Don’t fall for it. Salespeople have one job — to sell. That doesn’t mean they’re dishonest, but it does mean they’re trained to make you decide faster than you should. So listen, ask questions, but don’t get emotionally pulled in. Remember: the person who has the power to walk away always has the upper hand. What You Pay Later Matters More Than What You Pay Now Most people obsess over getting the best “deal” on the day of purchase — ₹20,000 off here, ₹10,000 worth of accessories there. But what really impacts your wallet is what happens after you’ve driven the car home. Think about it: · How fuel-efficient is it in real life — not just on paper? · Are service centers nearby? Are parts easily available and affordable? · Does the car come with extended warranty options? · What will it be worth after 5 years if you plan to sell it? A cheaper car with high maintenance or poor resale might cost you more in the long run than a slightly expensive one that runs smoother and retains value. So always compare the total cost of ownership, not just the sticker price. Negotiation Isn’t Rude — It’s Smart Once you’ve shortlisted your car and budget, it’s time to walk into the dealership. Here's where many buyers feel overwhelmed — but you don’t have to be one of them. Here’s a helpful mindset: The salesperson needs the sale more than you need the car. A few things that can help tilt the deal in your favor: Visit at the end of the month or quarter. That’s when dealerships are chasing targets. Look at the dealership’s inventory lot. If many of the same model are unsold, you’ve got leverage. Get quotes from multiple dealerships. Use one offer to bargain with another. Don’t reveal your exchange car early. Negotiate the new car price first, then the value of your old car. Also, be cautious of upsells — paint protection, teflon coating, seat covers, insurance add-ons. Not all are necessary. Ask for line-by-line cost breakup before saying yes. Documents & Paperwork: Don’t Miss These Once the price is settled, slow down. This is where fine print matters. Here’s a quick list of what you should check before making any payment: · Proforma Invoice – Should clearly list price, accessories, RTO, insurance, etc. · VIN (Vehicle Identification Number) – Ask for it and verify the manufacturing month. You deserve a fresh car, not old stock. · Registration Charges – These vary by state. Confirm if they’re actual charges or padded by the dealer. · Insurance – You’re not obliged to take it from the dealership. Compare online. · Loan Agreement – If you’re financing, read all clauses. If you're unsure how to get started, here's a complete guide on how to get a car loan. · Warranty Booklet & Service Schedule – Make sure it’s included and explained to you. And if it’s a used car: · Ask for RC (Registration Certificate), insurance copy, PUC, and a detailed service history. · Insist on a mechanical inspection report if buying from a dealer. Delivery Day Checklist Taking delivery is exciting — but don’t let emotion skip due diligence. Here’s a simple routine: · Inspect the car in daylight — look for scratches, dents, paint inconsistencies. · Cross-check chassis and engine number with the invoice. · Check all accessories promised are fitted (mats, covers, infotainment). · Ask for a delivery certificate, owner’s manual, and key duplication. · Take a quick test drive again around the block — make sure everything works. · If something feels off, politely decline to take delivery. You’re well within your rights. After-Sales Support: Don’t Ignore It The dealership’s job isn’t over when you drive off. Ask in advance about: · First service timeline — is it time-based or km-based? · Pick-up/drop service availability · Roadside assistance coverage · Cost of scheduled services Also, make a habit of joining Facebook or WhatsApp groups of car owners. These communities often have tips, dealership recommendations, and warnings that aren’t available anywhere else. Before You Buy — Final Checklist Let’s pause. Run through this quick checklist one last time: · You’ve test-driven at least 2–3 cars. · Your budget includes registration, insurance, and extras. · You’ve checked the total cost of ownership. · Your loan (if any) is pre-approved. · You’ve compared offers from 2–3 dealerships. · You’ve not revealed your full budget or exchange deal too early. · You’ve checked warranty, service schedule, and spare part availability. · You’ve verified VIN and ensured fresh stock. · You’ve gone through every line of the invoice. · You feel confident — not rushed — about the decision. If all this checks out, congratulations — you’re not just buying a car, you’re making a smart move. Wrapping Up Buying a car should feel exciting — not exhausting. But to enjoy that excitement guilt-free, you need to be informed, patient, and a little street-smart. You don’t have to know everything about engines or insurance — just enough to ask the right questions and walk away when something doesn’t feel right. Whether you go for brand-new or a trustworthy used one, the right car will not just take you places — it’ll become part of your life. And you deserve to start that journey on the right note. Frequently asked questions What is the 20/4-10 rule for cars? 20/4-10 rule is a thumb rule suggesting 20% down payment, 4-year loan term max, and car expenses should not exceed 10% of your annual income. What is the minimum salary to buy a car? There’s no fixed amount, but a net monthly income of ₹25,000–₹30,000 is often considered a starting point for entry-level car loans. Which is the best car under 10 lakh? This depends on your needs — safety, mileage, resale value, etc. Popular choices include Tata Punch, Maruti Baleno, and Hyundai Exter. Can I buy a car without DL? Technically yes, but you won’t be able to register or insure it in your name without a valid driver’s license. Do we need to pay full amount before car delivery? Usually yes, but ask your dealer for payment terms. Some allow partial payment at booking and the rest before delivery.