How to protect yourself when buying a used car

Posted by Chris Stamp in Personal Finance on 30 May 2012 - Chris is IT Director at checkmyfile

The announcement today by Jaguar Land Rover (JLR) of its best-ever recorded profits – at £1.51bn – is part of the Worldwide boom in car sales, despite difficult economic conditions. JLR saw a 76% rise in sales in China, were up 57.4% in France, saw 38.1% increased sales in Russia, a 22.3% increase in sales in Germany, and even struggling Spaniards bought 18.1% more of its cars. Across the water in the US, Toyota has seen its sales rise by 90%, and a combination of pent-up demand and the availability of stock is forecast to help all car makers increase sales by around a third this year.

All of which means that there will be a knock-on effect of a glut of used cars being privately sold.

When it comes to buying a used car privately, doing your homework can save you wasted journeys and unexpected issues with running costs and even resale values when you come to sell your car. Initial research is key, especially if you are travelling a distance to view and potentially purchase the car, especially given the cost of travel nowadays.

Firstly, the most basic step is to draw a shortlist of cars and ensure you understand the issues with ownership, running costs and repair costs – what are the common faults? Sizeable savings can be made buying privately, but not without taking increased risks and almost inevitably involving a bit of a journey for the car you want. It’s certainly not true to say that car dealers are guaranteed to sell you a great car, on the contrary in some cases, but private sales have very limited routes to recover losses if you buy a car which turns out to be a pup, or worse has been stolen or written off previously.

Once you’ve found a car through the usual suspects such as AutoTrader, eBay, or your local paper, it’s time to become an amateur Inspector Clouseau.

Research the seller – contact them and get their name and address – try and find them on social networks such as Facebook, LinkedIn and Twitter and get a feel for what they’re involved in – if you’re lucky you’ll get a picture too, so if you’re confident you’ve tracked them down, you can check it’s the same person who shows you the car. Verify their association with the address through a quick search on Learn more about where the car is being sold from, and check that the profile of the area aligns with the car being sold – checking a postcode profile on our free Postcode Check will enable you to see the type of people living in the area, and give you a view of the prosperity – if you find an expensive, luxury car in an area where the houses are very cheap, and there are high levels of unemployment, alarm bells should be ringing loudly.

Delve into the history of the car with the seller, before spending anything on a Vehicle Check, research as much as possible for free. Request that the seller emails you a photo of the V5C – the document that records who is the registered keeper of the car.

Importantly, this does not prove ownership, but realistically, it’s as good as you’re going to get. Check the basics such as the colour and spec of the car matches up with the V5C document, and that the seller is the registered keeper, and located at the address on the V5C. Finally, extract the V5C’s reference number and head to the Directgov website to use the excellent MOT history service – the combination of the number plate and the V5C reference number will provide a full history of MOT tests, noting any advisories and the mileage recorded at each test – use this to verify any seller claims about the car, and also to dig into what action was taken to remedy any advisory items.

Once these initial checks are looking good, it’s time to identify a cheap Vehicle Check – smart phone apps such as MyCarCheck offer the key checks for less than £3 – establishing whether there is a history of write-off, or whether the car has been reported stolen now, or in the past – try to do this as close to viewing and/or purchasing the car as possible to increase the chances of identifying a vehicle as having been stolen.

When you view the car, try to avoid any attempts by the seller to meet away from their address – for a first viewing this is not essential, but if at all avoidable, don’t part with the cash until you have attended the address on the V5C and ideally do the deal there.

Perform the usual checks on the bodywork and engine, looking for signs of excessive wear and tear or damage. Does the condition match the mileage? Check the paperwork is authentic the V5C has watermarks if held to the light. Check that the MOT is up to date before driving and that the tyres are road legal. Finally, take the car for a drive – listen for any strange noises, look for odd smoke or leaks, check all of the electrical features and ensure that you drive the car on as many types of road as is possible in the 15 minutes or so that you should spend driving the car.

If you have nagging doubts, walk away – there will be other cars. If you decide to proceed, go through the final checks – re-check the paperwork, validate the VIN number against that on the chassis of the car and ensure the tax disc is genuine and in date. When it comes to payment, if paying a deposit ensure a receipt is written which confirms the full price to pay and the sum of any deposit(s) paid – ideally make all payments using bank transfer using the vehicle’s registration number as a reference. Again, check that the bank account name matches up with the seller, or that there is a reasonable explanation if it doesn’t.

Smart phones typically facilitate instant transfer between payees – if you can set that up before paying the final amount it saves a lot of time and provides an audit trail in the event of any issues – with the Faster Payments service, most transactions will show instantly on the seller’s online banking. It’s possible you will have to use the seller’s computer to make the transfer – if so, check that virus protection is installed, and consider changing your password when you return home. Cash should really only be used as a last resort.

Finally follow the instructions on the V5C - complete and sign the new keeper parts of the V5C which should then be countersigned by the seller, retain the appropriate section from the right hand side and leave the main part with the seller to return to the DVLA. Take all paperwork with you, resist any attempts to retain certain parts that are part of the history, if not covered already ensure that your insurance and breakdown providers are aware of your purchase and drive home without too much vigour.

Some careful research, most of which can be accessed for free - such as the Directgov MOT check service, is the most essential part of purchasing a used car privately – letting your heart rule your head can easily result in you losing at least what you pay for the car and the dream can rapidly descend into a nightmare without care and taking some simple precautions.

Chris is our Head of IT. He has a degree from the University of Plymouth in Computing & Informatics. You can contact him at

The Cost of Incorrect Information on Your Credit Report

Your credit file is compiled from a number of different sources, including payment history from each of your lenders (past and present) and public data as reported by local authorities and courts. The majority of people find that everything held about them is correct, but due to the large amount of information being shared, errors in the information reported can happen, which can lead to issues when you go to apply for credit.

Published on 2 Feb 2018 by Tom Blandford

Full Article

Your Guide to Open Banking

On 13 January, the UK banks embarked upon arguably one of the biggest changes to personal finances since the introduction of computers. Open Banking is aiming to make it easier for banks, lenders and consumers to access and share information, with a view to creating new products and opportunities through innovation and increased competition.

Published on 15 Jan 2018 by Jamie Mackenzie Smith

Full Article

HMRC Bans Credit Card Tax Payments

From 13 January 2018, it will no longer be possible for consumers to use a personal credit card to make a payment on HMRC’s Self-Assessment tax portal. Historically, this has been a popular option as it allows what is often a considerable sum to be deferred.

Published on 12 Jan 2018 by Tom Magor

Full Article

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

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.

Published on 11 Jan 2018 by Kevin Pearce

Full Article

Are football clubs exploiting their fans

With Premier League teams under huge pressure to remain in the top flight of English football, the amount lavished on transfer fees and player wages have soared in recent years.

Published on 8 Jan 2018 by Sam Twyford

Full Article

What The 2017 Autumn Budget Means For First-Time Buyers

Wednesday’s autumn budget brought great news to would be first-time homeowners: if you’re buying a home up to the value of £300,000, you won’t have to pay stamp duty for the property. This, the Conservative Party estimate, will benefit 80% of first-time buyers, saving them potentially thousands of pounds on the total cost.

Published on 28 Nov 2017 by Jamie Mackenzie Smith

Full Article

Blacklists - Ten things you probably didn't know

1. Blacklists are not unlawful. No lender is compelled by law to give credit or to give any reason when declining credit. Each may consult several sources of information before making a decision, including any form of list that may exist. Any list containing personal data is automatically regulated by the Data Protection Act 1998.

Published on 9 Oct 2017 by Barry Stamp

Full Article

Is a credit building card a good idea

A credit building credit card is most often used by people that are either looking to improve their credit rating or take out their first credit card.

Published on 24 Mar 2017 by Kelly Luff

Full Article

Which Credit Report Information Can Landlords See

Whenever you rent a property, you will be required to pass some checks set by the landlord or letting agent to prove that you will be a good tenant and that you’ll be able to afford to rent the property.

Published on 7 Mar 2017 by Kevin Pearce

Full Article

Impacts of late payment on your credit card agreement

We’ve all done it before – had that mad panic when we’ve forgotten to pay a bill. But what happens if you do forget to pay your credit card by the monthly repayment date?

Published on 20 Feb 2017 by Kelly Luff

Full Article


We have loads of great customer reviews