How to buy a used car without breaking the bank
Guest post by Ella Sutton
Purchasing a used car is certainly the preferred option for many, saving people much of their hard-earned cash, as new cars are extremely expensive these days. However, buying a set of wheels can be daunting, whether done through a car dealership or a private seller, and there are many things you should keep in mind before entering into any deal.
Read these 6 top tips to understand the key things to look out for when buying a cheap second-hand car in London.
1. Consider ALL the costs
Purchasing a car isn’t just one big payment, instead, you must factor in a variety of upfront and ongoing costs. Of course, buying the car itself is the first payment you should take into consideration, and this can be paid right away, or using one of the many car finance deals out there.
Car finance can be handled in several ways, whether through a personal loan, a hire purchase agreement, a lease or personal contract purchase. Each has its own individual benefits, so you should read up about each loan type before you decide which is right for you. Above all, you will need to factor in your monthly repayments and make sure you are able to meet them.
Ongoing costs of owning a car include; fuel, tax, insurance, MOTs, parking permits and servicing. All of these points need to be thought about before you decide whether to commit to buying your vehicle.
2. Cars just one year old are a lot cheaper
Believe it or not, you can save yourself thousands of pounds just by purchasing a car that is one year old instead of a new one. On average, new cars cost around £28,500, but, after one year and having racked up 10,000 miles, this price drops to £21,000.
If you’re on a tight budget (like most of us living in London), then buying a car that is a year or more old will really help in slashing your upfront purchasing costs, so that is certainly worth thinking about first and foremost. Realistically, you don’t need the newest model on the market to get from A to B!
3. Some cars are cheaper to run than others
Cars with smaller engines tend to be cheaper to run, as larger engines normally burn a greater amount of fuel. In which case, be sure to keep the fuel economy in mind when picking your second-hand car. Going for a one-litre engine over a two-litre engine can really make the difference.
Generally, petrol vehicles also tend to be cheaper than their diesel counterparts. Diesel cars are more expensive to buy, and the fuel itself also costs more at the pump. That being said, the future of diesel cars does not look too promising, particularly given the backlash from environmental campaigners, the rising tax costs and the introduction of London’s Ultra Low Emission Zones.
As technology continues to improve each and every week, so does the popularity of hybrid cars, which are cheaper to run and have zero tax rates. That lovely, quiet Toyota Prius you step into when ordering an Uber? That’s an emission-free hybrid car. Though these vehicles tend to retain their value when being resold, they do, on the whole, cost more to purchase, however.
That being said, if saving money is your biggest concern when buying a second-hand car, it’s important to bear in mind that smaller cars are usually cheaper to insure.
4. Certain times of year are better for buying
If you are purchasing a car from a dealership, then it’s worthwhile to point out that certain times of the year are better for buying. Car dealers usually have targets to meet, often with large bonuses on the cards. Normally, these will be based on quarterly sales, which means that before the end of March, June, September and December are the best times to make a purchase, as dealers might be more willing to offer price negotiations and nicer finance packages.
5. Shop around and haggle
Just as you would do when taking out a phone contract or booking a flight, shopping around for the best deal by visiting several different car dealerships is certainly wise. Write down the different prices that each dealership has given you and ask others to beat it. Who doesn’t enjoy a little haggling?
Speaking of which, car dealers are well-versed in bargaining and many of them will expect you to do so. The first rule of buying a second-hand car is that you should never pay the listed price – always try to go lower. If you walk into a dealership armed with the right questions and an idea of what the vehicle you are looking at should cost, nobody will be able to rip you off. Remember, be friendly, but firm.
If you are buying from a private seller, it also does not hurt to make a discount offer. The worst that can happen is the seller says no. On many occasions, they may even call you back later on to accept your offer, especially if they haven’t been able to sell their car at the listed price.
6. Check the car before you drive away
Before you part with your precious cash, always thoroughly check everything within the interior and exterior to make sure it’s all in good working order. Important things to look out for include; the vehicle’s mileage, the overall condition of the car, the lights, seatbelts, tyres, oil, engine and radio.
This ensures you are getting exactly what you pay for. If anything is in poor condition, you may decide not to buy, or you could ask for the price to be lowered!