Buying a car?
Special information and what to look for when buying a used car
Click here for my free car buying guide
First up, no matter how many checks you perform on a used car there are some things that can’t be measured. You can’t really tell if an alternator or water pump is going to fail when buying second hand and parts can easily fail on a brand new car never mind used.
It’s also important to consider the age, mileage and price range. You have to expect higher mileage cars in the lower price brackets to have some wear and tear. In fact it’s important that used cars do show some wear in places as it’s an indication that the car is genuine and not been played around with too much.
However there are things you must do to minimise your risk and ensure that what you buy is genuine, reliable and excellent value for your money.
The life of a car dealer and buying a used car
1. Generally a dealer is working on a minimum of a £1000 profit margin per vehicle. Ideally they want this to be net profit (after VAT, preparation costs, warranty inclusion costs and that kind of thing.) Negotiation is usually available. Car lots want your business and will do all they can to close a deal on your first visit.
Car Dealers earn money in 3 ways –
- The profit margin in the car,
- Profit from extended warranties, finance packages and the like,
- Profit earned from your part exchange (if you have one)
2. Most dealers buy from auction, prepare the car as necessary, clean it and sell for a healthy profit margin.
Motability owned vehicles
3. Watch out for Motability owned cars. The positive with Motability is that cars are serviced under manufacturer’s guidelines by the main dealer.
The big negative is their cars have often suffered unusual amounts of wear and tear. Wheel chairs, car adaptations and struggles for owners to get in and out of the car lead to excessive wear in bodywork and trim.
So be mindful when a car is a preowned Motability. It’s common to find cars like the one pictured below with half a dozen or more body scratches and dents. The inside of Motability cars can also be quite poor.
Because of this the Motability car auctions are usually cheaper than the normal fleet car auctions. Some dealers like this and will buy cars considerably cheaper than they otherwise would if they were buying fleet.
The best part exchange values
4. Watch out for exaggerated part exchange valuations. This can indicate the car you’re interested in is overpriced. A big p/x price is a lure to hook you into a deal.
Notifying the DVLA
5. If you p/x your old car make sure you fill in the V5C yellow slips with the dealers name, address and send to the DVLA else you will incur a £100 fine.
What a tough motor trade
6. Car dealers once made easy six figure sums each year buying and selling but it is now much more difficult to make large amounts of money due to competition and savvy car buyers such as you. Be mindful and if you can squeeze out a little empathy for your fellow human being (dealer or not) then please do so. It might make you feel good and get more leverage when it comes to haggling for the best deal possible.
Friends are worth more
7. Never ask a friend to help you check out a car. If they recommend it and the car becomes unreliable it can break a friendship into dust.
Just show up
8. When looking at a car do not call the dealer to arrange a time. Where possible arrive unannounced. This way you can hear the car’s engine from stone cold. You will be starting the car stone cold every day so you’ll want to know what that car is like.
Focus, focus, focus (not the Ford kind)
9. Ask to be left alone when looking at the car. You want few distractions so you can focus on the job in hand and avoid any sales spiel.
Hold your cards close to your chest
10. It’s likely to be one of your biggest investments so takes your time and if you get to the point of purchase, work hard to get the best deal you possibly can! Every £50 saved is money in the bank.
Use Autotrader effectively before you arrive
11. be knowledgeable by researching a list of cars you can take a look at. Let the dealer know this early on too. If they think you’re not planning to buy a used car today you can get yourself a particularly good deal. It’s a great scarcity tactic.
You can buy my used car guide here