8 min read

Top tips when buying a car

Faith Archer
3 February 2017

Thinking of buying a car? Check out our top 10 tips from finding the right car to getting a good deal.

Buying a car could be your biggest purchase apart from buying a home, so it pays to do some research and shop smart. You’ll face a bewildering variety of decisions, so let us help you navigate around the potential pitfalls with these top 10 tips fresh from the car-buying battlefield.

1. Budget for the car AND the running costs

Dreaming of a Maserati on a Micra budget? Start by working out what you can afford. If you’re borrowing money to buy a car, you’ll need to cover not just the monthly payments but also the cash to keep it on the road.

It’s worth allowing for – deep breath – insurance, car tax, fuel, an annual MOT for cars over three years old, servicing, repairs, parts, breakdown cover, parking charges and depreciation (that is, the loss in value over time). Phew. If you’re on a limited budget, it’s worth thinking about fuel economy, reliability and cheaper insurance.

2. Weigh up ways to pay

Do you know your leasing from hire purchase (HP) or a personal contract plan (PCP)? Welcome to the wonderful world of car finance.

It’s worth understanding your options before setting foot on a forecourt. Sure, the salesman might promise tempting offers if you sign up in the showroom. But maybe you could cut the cost of borrowing by shopping around for car finance options elsewhere.

You may even be better off going with a personal loan or credit card if it covers the cost of the car. Make sure you compare interest rates - look for the annual percentage rate (APR) – monthly payments and total interest paid. (You can compare car finance options for you in the 'Offers' section of your free ClearScore account)

3. Make the most of your test drive

For most of us, it’s hard to get a realistic feel for a car on a 15-minute test drive. Too scared to put a toe out of line, few of us actually drive how we would day-to-day.

But test drives don’t have to be so short and prescribed. Don’t be afraid to ask for more time or to go on a slight detour – the salesperson can only say no. This way, you might get a chance to head out to a fast road and get a real feel for the car at speed and whilst accelerating. If you can get to a supermarket car park you could even try a reverse bay park to get more realistic idea of how the car moves. If it’s a second-hand car, having a longer drive will also help you test all the gears, and trying a reverse park will help you make sure it does actually reverse (which may sound daft, but trust us, you can never be too careful).

Find the best car finance options for you based on your credit history

4. New or new-to-you?

The drawback of a brand spanking new car is that the moment you drive it off the forecourt, you will lose thousands of pounds. Why? Because the car is no longer new. Weigh up whether your wallet might be better off with a second-hand car – or even nearly new. If you go for a second hand option, you could pay extra for peace of mind and buy from a dealer instead of a private seller. Can’t decide whether to go new or second-hand? Read our pros and cons.

5. Swot up on how much a car should cost

Any salesman will say you’re getting a good deal. If you want to be sure, do your homework first. You can check the list price for particular makes and models on websites like Parkers, What Car and Honest John or by flicking through a copy of Auto Express.

The cost will also be affected by the age and condition of the car, the mileage, where you’re buying it – whether from a dealer, private seller or at auction - and any warranties and guarantees on top.

6. Timing, timing, timing

Depending on when you buy a car, you might get a better discount. Work out when the dealer might be keen to do a deal. Good times might be a few weeks before dealers hit their targets each quarter, or before new number plates are issued in March and September.

Also, consider the kind of car – you might get more money off a convertible in the middle of winter, or on a 4x4 in a heat wave.

7. Do you want to own your own car?

This isn’t a trick question. With some car financing options like Hire Purchase, leasing and PCP, you get to drive a car – but it’s not yours. Instead, the car still belongs to the dealership or finance company and you’re effectively leasing it from them each month. On the plus side, these kind of finance plans should lead to lower monthly payments. However, if you can’t keep up the repayments, the company could come and take the car back.

8. Buying a used car? Check if the car actually belongs to the seller

If you’re buying a used car, it’s worth making sure that the car definitely belongs to the person who’s selling it to you. If you buy a car that has unpaid finance on it, it may actually still belong to the finance company, not the seller. If this is the case, the company could chase you for the money or even try to repossess your new wheels. So if you’re buying a used car, it’s worth shelling out £20 to £25 for a vehicle car history check. This will show not just if there’s any outstanding finance, but also if it’s been involved in a serious accident, stolen or written off by an insurance company.

9. Not sure about the condition? Ask an expert

There’s a whole laundry list of things to check when you’re looking at the condition of a car and taking a test drive. If in doubt, you can always pay an expert to check the car for you. From around £100 to £120 you can get an independent report from a motoring organisation or other specialist.

10. Be prepared to bargain

Checked out your chosen car? Now get ready to haggle. Start low, stay friendly and don’t be afraid to walk away if you’re not getting the deal you want. See if you can get any extras thrown in, from breakdown cover to floor mats. Ask for written quotes, so you know exactly which options are included, and can play one seller off against another. Then you can drive off into the distance, confident you got a good deal on the right car for you.

by Faith Archer

Faith Archer is an award-winning journalist. She's written about personal finance for over 14 years, and has worked for many of the UK's biggest newspapers. Faith has brought along her expertise to write this article especially for ClearScore.

ClearScore exists to make your finances simple.
We offer a free service where you can handle everything to do with credit in one place. In your ClearScore account, you can see your credit score and the full details of your credit report. Your credit cards, mortgages, mobile phone contracts, loans, overdrafts and utilities all on the record. Our goal is to make ClearScore as simple, calm and straightforward as possible. Money is stressful enough.