How to Get the Best Deal When Buying a New or Used Car

Posted by Kevin Pearce in Personal Finance on 11 January 2018 - Kevin is a Senior Credit Analyst at checkmyfile

Buying a new car is both exciting and expensive, but if you know where to look and when, you can grab yourself a bargain. If you take a little time to look into finance or loan deals as well, you can bring down the overall costs significantly.

There’s no secret to getting the best deal on a new or used car, just some carefully-considered preparation and making sure you do your homework well in advance.

Buy at the right time of year for a cheaper car

For some people age is much more than just a number and the difference between a car that’s come out early in the year and later can make a big difference.

Ask yourself this: If you were shopping for a brand new car would you rather pick up something that’s come straight from the factory or an identical car that’s been sat there for up to six months? Even if the cars are the same spec, style, year and colour, most people would rather go for the ‘newer’ new car, which is why you can often get a good discount on the outgoing number plates.

New number plates are released every March and September so the best deals on the outgoing number plates can be had before this time (February/ August). Dealers want to free up space for the newer plates but buyers want something new, so this that’s why you’re more likely to save big around this time. The only real disadvantage of buying an ‘old’ plate against a ‘new’ one is that you may find that your car starts to depreciate in value sooner.

What about used cars?

The same seasonality applies for the used car market; there’s a surge in new car sales when the new plates come out, which means plenty of people want to part ways with their current car, so you’ll find plenty to choose from that’s been part-exchanged at the dealers.

How do MOTs come into it?

Once a car is three years old, it is required by law to pass an annual MOT test to ensure it’s safe for the driver and other road users. Most cars should have no trouble passing their MOT, but for many motorists the extra hassle of taking their car for an MOT once a year is too much to handle and take this opportunity to sell the car.

For this reason a car loses a chunk of its value once its reached MOT age, making it ripe for the second hand market. If you’re happy to buy a car that’s still young but has perhaps lost the ‘new car smell’ these can be a good option- in many cases you’ll be saving money on something which is still available to buy new from the dealerships.

For owners of older vehicles, an upcoming MOT can be a good reason to think about buying a new car, especially if they think any repairs are likely to cost more than the overall value of the car.

Get a great car by waiting for an unpopular time of year

Going against the market trend can also help when it comes to saving money; convertibles sell well in summer because it’s easy to sell a drop top when the weather’s warm. The dealer knows that, so they’re less likely to budge on the price. Buying the same car in winter means you’re more likely to be able to haggle them down to a reasonable price; they’d rather take the hit than risk not finding another customer for several months.

The same reasoning applies to 4x4s, which are in their element during the winter months: they’re less likely to sell during the summer, so there are more bargains to be had then.

Even the day on which you visit the dealership can help - weekdays are generally quieter and the dealer is more likely to be flexible if it means securing the sale in a quiet period. You will also get more of their attention and be able to spend more time digging into the car’s history.

Getting the best finance deal or loan for a car

Getting the price of a car down to a reasonable price is only half the battle. Unless you’re planning on paying off the sticker price in one payment, you may need to secure extra credit to pay for your car.

Going for dealer finance is a popular option for a lot of people just because it’s there and can be done on the spot. What most people might not realise is that you’re welcome to try and finance from alternative, such as a bank loan. Dealer finance is often sold at a higher rate of repayment than a bank loan, which means you end up paying more overall, however you might find it easier to secure than a loan.

To get the cheapest loans (in terms of the APR charged), most lenders will need proof of your ability to repay credit you’ve borrowed. If you’ve got a credit card or a mortgage that you’ve been reliably making payments on, and no adverse information, this should be enough to show any prospective lenders that you are exactly the kind of customer they’re looking for.

Even if you don’t have a spotless credit rating, it’s vital that you make sure there aren’t any incorrect entries on your file that could prevent you from getting the credit deal you want. Arrears appearing on your credit file could put the brakes on an application - something that would be even more frustrating if the information has been lodged in error. It’s not common, but it does happen.

Ensuring that your credit file is optimised is essential for obtaining the best finance deals. A poor credit rating will mean higher repayments, or even being declined completely.

You can check your credit rating at any time with checkmyfile - try free for 30 days and then £14.99 monthly - cancel anytime.

Finally, remember that if you do manage to get the finance you need to buy a new car – regardless of the specific option you go for – the credit agreement will show on your credit file and be visible to lenders very shortly after you get the keys.

It’s crucial that you make all the necessary repayments on time, or not only could you lose your dream wheels, but your credit rating could also take a hit.

How To Get The Best Car Finance Deals

New car sales may have slowed in recent years, with the economy, emissions scandals and Millennials all being cited as the root cause at one point or another. But the number of people choosing to use credit as a means of driving away in a new car continues to rise, according to figures from the Finance & Leasing Association which shows that the new car finance market grew by 15% in July 2018 when compared to the previous year.

Published on 8 Oct 2018 by Kiah Phillips

Full Article

We're Now More Likely To Be Borrowers Than Savers

UK Households are now more likely to be borrowers than savers, with savings at their lowest since 1963, according to a study by the Office for National Statistics. Households are increasingly borrowing more – by taking out loans, car finance, and mortgages – than they are collectively depositing into savings accounts.

Published on 5 Oct 2018 by Sam Griffin

Full Article

The Credit Crunch 10 Years On: What’s Changed?

For many people, especially the those lucky enough to not have been old enough to be directly affected, the economic downturn of 2007-2009 seems like a distant memory. The first iPhone had launched a mere two months before the recession hit, and since then they’ve rebooted the Spiderman film franchise not once, but twice. But more importantly, has enough time passed for the borrowing/lending market to revert to its old tricks?

Published on 26 Sep 2018 by Jamie Mackenzie Smith

Full Article

The Limitation Act 1980 and Debt Time limits

The majority of credit consumers believe that once a debt has been acquired, that debt will remain until the full balance has been cleared regardless of the length of time passed. This may not be the case though, thanks to a little-known piece of legislation known as the Limitation Act 1980.

Published on 19 Sep 2018 by Erika Bone

Full Article

UK Households More Likely to be Borrowers Than Savers

UK Households are now more likely to be borrowers than savers, with savings at their lowest since 1963, according to a study by the Office for National Statistics. Households are increasingly borrowing more – by taking out loans, mobile phones, car finance, and mortgages – than they are actively depositing into savings accounts.

Published on 3 Sep 2018 by Sam Griffin

Full Article

Wonga Administration: What it Means For You

On Thursday 30th August the payday lender Wonga filed for Administration, following a spike in compensation claims and increased pressure on the payday loans industry. This follows a steady decline in this form of lending since the FCA began introducing stricter regulations 2013 in the name of protecting consumers.

Published on 31 Aug 2018 by Jamie Mackenzie Smith

Full Article

How a Baby Name Can Affect Creditworthiness

A lot of preparation (and usually arguing) goes into choosing a baby name – books, ‘top 100’ lists, place names, family names – the list of possibilities is endless. The trouble is, most parents don’t give much thought to the long-term impact of the name they decide on, beyond checking to make sure it doesn’t sound ridiculous when paired with the last name or that when put into initials it doesn’t spell something unfortunate.

Published on 19 Aug 2018 by Jamie Mackenzie Smith

Full Article

The Advantages & Disadvantages of Store Cards

There are a number of reasons you might take out a store card: whether you’re just waiting in-line at the shop and find out you can save on today’s shopping or they offer the promise of making money in the future, these cards regularly find their way into wallets (or phones via an app). Most big retailers offer their own cards, which allow you to take your purchases home – often with a nice discount applied – without having to part with a penny at the till.

Published on 10 Jul 2018 by Tom Blandford

Full Article

What Happens To Your Credit Report When You Move Country?

Moving from one country to another results in a lot of changes and new things – a new place and culture, new job, new people and in some cases even a new language. However, one thing lots of people do not realise is that you will also be starting afresh when it comes to your Credit Report. Credit Reports and the information they contain are country-specific and do not follow you from one country to another.

Published on 27 Jun 2018 by Kirstie Day

Full Article

What To Do If You’re a Victim of Data Breach

Another day, another high-profile data breach, with the morning news bringing word of another leak of personal information that affects millions of consumers. This time it’s the turn of Dixons Carphone - the company behind PC World, Currys and Carphone Warehouse.

Published on 14 Jun 2018 by Jamie Mackenzie Smith

Full Article
keyboard_arrow_left

keyboard_arrow_right

We are rated number 1 for customer service on