Top tips for buying a used car

Motoring 2020-6-3
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Get a great price on a used vehicle with these buying hacks.

Minimise the impact of depreciation

The shiny new cars look great, but the ‘rumour’ that cars lose 20% of their value as soon as you drive them away from the dealership is unfortunately accurate. And that loss continues to grow, with a new car losing 60% of its value within the first three years.

Depending on the make and model you buy, a new car taken on finance could mean that you’re immediately in negative equity as soon as you drive away in it.

This issue is generally alleviated when you don’t buy brand new. But if you still want that ‘shiny new car’ feeling, a pre-registered car could be the best option. This means that it’s never been owned by an individual, but it has been registered to the dealership, so technically you’re not the first owner.

Remember, the power is in your hands

With a new car, the dealer holds all the power. With an older car, the power is in your hands, as the dealer wants to make room for the newer, more valuable cars with a higher profit margin. Meaning they’re probably more willing to do you a deal.

Hitachi Top Tip: Make sure you have the cash in the bank ready to buy as this puts you in a great position when it comes to haggling. Take a look at a low cost car loan from Hitachi Personal Finance for a quick and easy solution to getting the money in your pocket.

The best of both worlds

One of the main reasons people tend to lean towards new cars is that they’re often covered by warranty policies, offering the buyer peace of mind. However, depending on the make and model you’re looking to buy, a pre-registered or used car is not necessarily out of warranty. 

You’ll have to do your homework, but manufacturers such as Kia, Hyundi and Toyota have been known to offer warranties of up to 7 years, regardless of how many previous owners it’s had or miles it’s driven.

Timing is everything

When it comes to buying a used car, the deal you get could be heavily influenced by the timing of your buy, so don’t underestimate getting that right.

Generally speaking, the following times work best:

  • March/September - when the new registrations are released, or just before
  • March/June/September/December – end of the ‘quarter’ usually means that a dealer will be pushing to hit sales targets
  • End of the month – similarly, they may have monthly targets to hit, so I’s worth giving it a try

Introduce some healthy competition

Always check multiple dealers to make sure you’re getting the best price possible. When you see a car you love, it can be tempting to just go for it, but without any haggling or comparison you’re bound to get a bad deal.

Make sure each dealer you’re working with knows you’re doing your homework, then they’ll take you more seriously and are more likely to give you a good deal.

Don’t be too keen

Even if you REALLY want the car you’ve seen, don’t let on. Being too eager will put all of the power back in the sellers hands, so play it cool. Pretend that car is just one of several that you’re considering and try to create some ‘doubts’ to convince the seller that they need to work hard for your business.

Don’t be afraid to walk away

If the price isn’t right, walk away. As Brits, hard haggling doesn’t always come naturally to us, meaning more experiences sales people (think, car salesman) will call our bluff and we will fold. If you think you should be getting a better deal, don’t be afraid to walk away.

You never know, you might get a call in the hours or days that follow with a better offer.

If at first you don’t succeed…

A discount isn’t the only way you get can more for your money. Sometimes dealers just won’t be able to give you the price you want, but if you still really want the car, see whether there are any additional freebies they can throw in to make it worth the money. Everything from additional warranty protection to a tank of petrol can help you out and make the purchase better value.

If you’re looking to get your hands on a new motor, check out our low cost Car Loans from just 3.9% APR Representative between £5,000 and £25,000.

 

Hitachi Hints and Tips is intended to be informative and interesting. It does not constitute financial advice, and you should always do further research when making any financial decisions. All information was correct at date of publication.

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