How to buy a car: Top tips

May 28, 2013

You've got your eye on the new car of your dreams, but what should you do next?

If you’ve seen the car of your dreams and feel ready to take the plunge, there are some important things to think about before you hand over your money. Read on for some useful advice to help make sure the experience of buying a new car is as smooth and stress-free as possible.

Work out a budget

For almost everybody, the biggest consideration when buying a new car is how much you can actually afford to spend. It's easy to budget if you’re in a position to pay in cash, but often people will buy cars on credit.

If this is true in your case, it's worth taking some time to look at the exact nature of the deals available and work out exactly what you can afford in repayments before you sign an agreement. Even if you just arrive at a monthly figure that you can’t exceed, you’ll be in a more comfortable position when it comes to agreeing on a deal.

When calculating your monthly budget, you should also consider how the annual running costs will break down – fuel, servicing, insurance and road tax all increase the total cost of the car.

It's a good idea to tot up all these costs and take them with you when you go car shopping. Instead of looking around showrooms and getting confused by different offers and figures, you’ll already have a breakdown of realistic overall costs as well as a budget for monthly repayments.

Look at resale values

Particularly if you’ve had your heart set on a car from the beginning, it's worth taking a step back to evaluate factors like potential resale values – are you likely to get a good return if you decide to sell or part-exchange your car a few years down the line? Although the premium brands tend to suffer from less depreciation, good value superminis and mini SUVs are now tending to hold their value too. Some cars like the Fiat 500 and MINI are more expensive to buy than their rivals but you can expect more money for them second-hand because of their desirability.

Be careful with optional extras

Avoiding gaudy colour schemes and expensive non-standard options like heavily tinted windows will help, as these add nothing to the value of the car, and could even make it worth less in the long run. Options are notorious for bumping up the list price for little financial return when the time comes to sell.

Consider the car's purpose and practicality 

Other things to think about before you start hitting the showrooms is what kind of car you need and how much you'll use it.

What's your lifestyle like and how often are you likely to drive the car? Does your job mean you spend most days on the road, or do you need a smaller runaround to do the school run and get you to the shops? A diesel model is going to be more fuel efficient for those long hours on the road, whereas a petrol model would be cheaper for shorter local journeys.

It's also good to consider what size and bodystyle would be practical for your typical daily use. If you have a family to ferry about and need a reliable car with plenty of space, it might be best to consider an estate. However, if you’re a sports-freak and regularly need to pack a lot of equipment into your car you’ll think differently – maybe a crossover or small 4x4. Take a look at how easy it’ll be to get bulky items in, fit child seats or fold the seats flat. Alternatively you might be a city dweller and need a nippy little hatch that can easily handle narrow streets and slow moving traffic.

Bootspace is a crucial concern for many buyers, too. Do you need to store a big weekly shop in there, or need enough room for a pair of folding buggies? Hard-wearing materials will mean you can get more life out of your car, especially if you’re carrying lots of sports equipment or a dog.

Take a look at the safety equipment in the car before you sign on the dotted line. There are high standards that cars have to live up to, and many cars come with extra equipment such as electronic stability control (ESC), blind spot monitors, and emergency brake assist. But also check out the car's European NCAP rating. NCAP is an independent service that crash tests vehicles to give them an official safety rating out of five – most cars these days achieve at least four stars – with anything less considered seriously below par.

Where to buy your new car

These days there are so many different places, dealers and outlets to buy a car from, that punters are simply spoilt for choice. You can pick up a new or used car from traditional showrooms, franchised dealers and brokers, while it's increasingly common to buy online, direct from the manufacturer, too. Each method has its own merits and downfalls, so you need to decide which one suits you.

Buying from a dealer

Lots of people chose to buy from a franchised dealer because they have knowledgeable staff and lots of aftersales support – and because many are linked to manufacturers, their mechanics often specialise in a specific brand.

They also offer a good opportunity to see the car you’re thinking of buying up close, and you can easily test drive one to get a sense of how it drives. It's also common to get a good deal on your car if you’re willing to haggle with the salesperson.

However, you can often find yourself paying higher prices, and pushed into buying something that doesn’t quite fit your bill. Be firm with sales staff – while many are friendly, they often have their own agenda and monthly targets they need to hit. Many have been known to sneak in expensive extras before asking the customer. If they know you’re not going to be pushed around, it's more unlikely they'll try anything they shouldn't.

Buying from a broker

Brokers are usually found online, and buying from one means they will take control of the purchase process – you are effectively paying them to buy a car for you. If you don’t have a car to part-exchange, it can be a good way of keeping your costs down, so long as you aren’t too worried about compromising on specification.

Cars bought from brokers will often be much cheaper than dealerships, and it's possible to get a really good deal if it's a dealer selling off unsold stock. Deals are usually very transparent, with no hidden clauses and it's a good way of shopping for a car without feeling the pressure of sales staff.

The flip-side of this, of course, is that there's a lack of expert advice and opinion. Buying from a broker also means it's harder to check the particulars of a model and you can be left waiting a long time before you see your car.

Check the small print and documentation

However you choose to buy a car, make sure you read all the small print – even if it's really boring. You need to be presented with a clear and final price before you agree a sale, and make sure you get a copy of all the necessary documents including service history, previous MOTs and a comprehensive owners manual if the car isn't brand new. If there are any special agreements you’ve made, be sure to get them in writing so you’ve got proof if the dealer doesn’t deliver.

Be aware of extra costs and final price before you buy

It's worth remembering that when buying a brand new car, a range of extras can be added to the price, including VAT, number plates and delivery costs – so make sure you’re aware of these additions, or check to make sure these  included in the price you’re quoted.

Lastly, be sure to buy with your head and not your heart. While it's very tempting to opt for the car of your dreams, you could end up throwing your money away on something that doesn’t realistically fit your lifestyle and needs. You’ll only regret it in the long run!

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