If you are a first time car owner, then at some point, your car’s certificate of entitlement will be due to expire. This means that you will have to make a decision between either extending the COE or scrapping your car. Each approach has its own merits and should be considered.
Not sure which approach to take or how to begin the process of scrapping your car? Fear not for we have written this article to cover both administrative and technical aspects of the process.
Who Should Scrap Their Car
You should consider scrapping your car if one of these following categories apply to you:
- You wish to get a new car
- Your current car will not last for much longer
- You wish to get the COE rebate and potentially the PARF rebate
- You wish to sell your car body’s scrap
When you scrap your current car, you will be compensated for any remaining time that is left on the COE. As such, if you wish to drive on the road, you would have to purchase a new car with its own COE.
Do note that the PARF rebate is only available to owners who are scrapping their vehicle within the very first 10 year COE cycle. If you have previously extended your car’s COE, and are scrapping it in what would be now the second cycle, then you will only be eligible for the COE rebate.
How Is The Value Of Your Car’s Scrap Calculated
Scrap car dealers will pay you a sum based on the evaluation of your vehicle’s worth. In particular, they will look at two aspects.
Firstly, your car’s overall condition and duration in operation are factored into its value. The time it has spent on the road is used as a proxy measure for determining the amount of wear and tear that it is likely to have sustained. This in turn depreciates the value of this asset. At the same time, if it has suffered any damages or defects, then these will further lower its value.
Secondly, market forces such as demand and supply for the particular car model will also affect its value. If your car is being scrapped in a year whereby demand for it is high but supply is low, then you can expect to receive higher offers from scrap car agents.
How To Start The Scrap Car Process
To start the process, you should get in contact with several scrap car agents. These agents will likely ask you a few basic questions about your car in order to estimate your car scrap value. It is recommended that you get several quotes and make comparisons so that you have an understanding of the demand for your car.
Once in contact, the agent will guide you through the rest of the steps, including all administrative paperwork that has to be filed.