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March, 2015
Buying a 2nd hand vehicle in Singapore
אלון שחם
 
I am writing this short article to share my (bad) experience and lessons learned buying a 2nd hand vehicle shortly after arriving to Singapore in 2014.
2nd hand vehicles in Singapore are expensive, very expensive, a 7 year old family
sedan would easily cost around SGD 50K. Vehicles in Singapore have a life span of 10 years, which after they are sold or scraped, and the owner will receive from the Singapore government the residual value of the vehicle, typically 10% of the
original paid price, +-. When you buy a 2nd hand vehicle you will have to put 40%
down (cash), and the rest can be a bank loan, typically a comfortable one, around
2%/An.

First question you have to ask yourself: do you really need this kind of
liability?, the amounts are considerable, while other alternatives in the form of
public transportation may suffice, if you decided to further explore buying a 2n
hand vehicle, please continue reading..
There are literally hundreds of 2nd hand vehicle dealers on the Island, while I’d
like to believe most of them are honest, some are not, and you as a potential
customer are at disadvantage due to lack of knowledge and experience, and they
know that, so take your time to study, compare, negotiate, and most importantly
check before committing to any deal. Not checking properly will most likely
result in money and major time loss, don’t underestimate that.
 
Most, if not all 2nd hand Vehicles in Singapore are sold through mediators,
dealers, many of them are located in Auto malls like the Auto megamart in Ubi
ave 2, as well as other location, you go into the Auto mall, and there are 5-7
floors full of used vehicles, and dozens of dealers on each floor trying to push
their goods.
There is a wide selection of vehicles in those places, but before you start your journey, do your home work and come prepared, first step would be the internet,
sgcarmart.com is a good source of information for second hand vehicles, you can get useful information on the vehicle, as well the dealer information.

Decide which vehicle you are looking for, sedan, sports, MPV or any other type and brand. Go to the web site and compile a list of potential vehicles that fit your budget and needs, then group them by dealership & location.
 
I would recommend, as an additional precaution step, after you compile a
dealers list, run a quick dealer name search in Google, sgcarmart.com has a
complaints forum (http://www.mycarforum.com/forum/77-complaints/),
which is another source of information on any negative user feedback and
complaints associated with your designated dealer.
 
After you have done your short due diligence, go and meet the dealer and ask to
see the specific vehicle you listed, coming prepared will signal the dealer you
have done your home work, wondering people are easy pray for car dealers.
Once there, you will find the vehicle shining, same for the internal sections like
motor compartment and vehicle interior, like new, 2nd hand vehicles in
Singapore are being groomed pre sale, it means nothing!, on the contrary, it
eliminates any evidence for leaks, rust and other things that it’s easy to spot
before the vehicle is fixed. While you don’t know much about cars, take a close
look, worn tires can indicate high mileage, look under the rugs for water or other stains, open the back compartment, where the spare is located and look for rust, start the engine and listen for strange noise, look under the vehicle for any signs of oil stains or dents, lose wires of hoses, bring a flashlight, it helps, again while you may not (and probably not) see anything, it sends the dealer a signal you should not be taken lightly.
 
Prices are negotiable, but from my experience, for a good vehicle, around 50K, you can probably shave 5-10% with good negotiation skills and some patience, but I cannot advise much on this point, do your best, it’s worth paying a bit more for a good vehicle. Sometimes it’s easier to negotiate value items like extended
warranty (1-2 years) or repairs instead of hard cash, warranty is worth money!,
 
especially with Singapore 2nd hand vehicles, the dealer will give you at least 6
months warranty for engine and gear per Singapore’s Lemon law, anything
beyond that is negotiable, try!.
 
Please be aware, that dealers would typically add ‘admin fees’ which are on top
of the agreed amount ($500-$1,000), those are negotiable and can be waived if
you are persistent enough. Tell them this is your overall budget, inclusive all fees
and that’s it.
 
Next, most important point, and I cannot stress this enough, assume that the
mileage on the vehicle is not the real mileage of the vehicle!, surprised, yes, I was
too, modifying the odometer in Singapore is not illegal, and I do believe, there are
considerable numbers of 2nd hand vehicles on the Singapore roads, that their
owners are not even aware the mileage is not the authentic mileage, modifying
the odometer is common, do not, and I write again, do not buy a 2nd hand
vehicles without any evidence that will confirm the current odometer read. Ask
for a service record, call or walk in to the shop the vehicle has been serviced in
till it was sold, talk to the original brand vehicle dealer (selling new and
servicing), they will probably be able to provide you some insights on the
vehicle, at least until the warranty expired, I highly recommend paying them a
visit, and even taking the car to a pre buy check with the certified service center,
this $200-300 spend can save you thousands in repairs due to accelerated wear
and tear because of manipulated high mileage.
 
Another step you will have to take, is to send the vehicle to a formal pre buy
evaluation center, common are STA or Vicom, both are pretty much the same,
and will check the Vehicle across several parameters, most importantly if the
vehicle had any accidents, the dealer will do this service for you, do not buy a
vehicle with a grade lower than B, most of them, if not all, will get B as the
highest, if it comes out C or D, just let it go. As a mitigation step, agree with the
dealer that if the vehicle does not pass with a B, he will carry the cost of the
evaluation (~$180), he should agree.
 
From my short experience, you cannot rely solely on this evaluation for vehicle
mechanical fitness, that’s why I highly recommend to take the vehicle to a
separate service center as described above for mechanical check/evaluation, in
addition to the STA/Vicom check.
So, you found the vehicle you want, agreed on the purchase terms, validated the
mileage, evaluated the vehicle, and checked it’s mechanically fit, congratulations,
you are probably on the safe zone, but nothing is 100% guaranteed, still it’s a 2nd
hand vehicle, so be prepared to spend couple of hundreds on some repairs
coming your way in the short term.
 
To sum it up:
 
• Determine your budget and decide on the vehicle brand
 
• Research sgcarmart.com or similar sites on existing inventory
 
• Compile a list of potential vehicles, and list the dealers and their location
 
• Run a quick search for any customer complaints on your dealer list
 
• Identify your vehicle, do an initial visual inspection
 
• After you negotiate with the dealer on the price, warranty, repairs, etc.’
 
(clarify all additional fees, and ask for a detailed cost breakdown)
 
• Confirm mileage authenticity (Again, do not compromise on this step)
 
• Confirm mechanical fitness by sending the vehicle to an authorized
 
service center for a pre buy check (~$200-$300)
 
• Send the vehicle to STA/Vicom to be graded at least a grade B (~$200)
 
Good luck and enjoy your new car.
 
Alon S. (sec@spimtech.com)
 
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