Car Finance - Make A Smart Deal _legal Documents

legal documents you should make sure that registration certificate (rc book), insurance certificate, pollution under control (puc) certificate and service book are all in order. rto tax: don't forget to check if the one-time rto tax has been paid by the previous owner. registration certificate make sure that the document is registered in your state and the state's name is mentioned in the registration paper. information with regard to engine number, chassis number, manufacturing date, etc are found in the rc book. always check the engine and chassis number of the vehicle. make sure there are no missing pages in the rc book. insurance certificate it is also important to know whether the car has a third party insurance or a comprehensive insurance. ensure the premium has been paid regularly. never forget to get the insurance certificate in your name. road tax also get your name registered in the road tax papers. service book from this book you can get the full information with regard to the servicing the car has undergone so far. informing authorities: submit all details pertaining to the model of car, registration number, engine and chassis numbers, the name and address of its previous owner to the rto or the insurance company. this will help you know the illegal precedents, if any, involving the car. take a hard look before you sign car financing does involve lots of paper work. but the entire process need not be greek to you. you can and should understand the important steps in the process. 1.you should get to know what commercial terms like loan amount, interest rate, installment amount, installment due date, loan duration, up front charges, advance installment stand for. 2.also take interest to understand the amortisation schedule -- conveying the break up of interest and principal. 3.look for any clause that may suggest that payment be made without any notice. 4.you should also get to know the terms of prepayment premium and if partial prepayment is possible. 5.if you are making your payments through pdcs (post dated cheques), you may have to undertake not to close the account or refrain the financier from depositing your cheque. watch out for these conditions.

6.look for details of hypothecation of the car to the financier. 7.you should also look for conditions with regard to the maintenance of the car, payment of all taxes and the insurance cover. 8.take a look at the clause explaining how any insurance claim money should be spent in case the car is damaged in an accident. 9.find out whether there is a clause stipulating that the vehicle be used only for lawful purposes and for non-commercial use. and if so, get know the conditions in this regard. 10.make sure you get to know all the conditions in the clause dealing with paying installments irrespective of the condition of the vehicle. 11.carefully read the power of attorney paper you require to sign in favour of the financier. 12.watch out for clauses dealing with defaults including the one that authorises the financier to declare a default. 13.a careful reading of the clauses containing the actions that can be taken by the financier in the event of default is a must. 14.read the demand promissory note for the loan amount. 15.take a look at the rto forms. also, watch out for the following details before inking the deal 1. pre-closure charges 2. hidden costs 3. installment due dates 4. amortisation schedule hidden costs: companies may slap service charges, documentation charges, processing charges on unsuspecting customers. this may increase the cost of the loan more than what it appears on first look. keep an eye on taxes like vat (value added tax), tot (turnover tax) you need to pay. the taxes may also jack up the cost of the loan.