Car purchase can be a complicated and time taking process, not to mention risky as well. There is so much choice and persuasion out there that it is difficult to focus and set your mind on what you want, there is a lot that can go into buying a car, especially when you are buying a used car.
We shall be looking into various ways and methods which can be applied practically to save you time and effort and help you make the right decision whether you buy a used car or decide to make the move and buy yourself a brand new car.
1.1 When to buy a new car – Signs to keep eye on
1.1.1 Breakdowns have become more frequent
All cars eventually break down there are no qualms about that. Most cars would break down due to batteries, exhaust and lose cables etc. Some other more serious issues include clutch, cooling system and tyres etc. However If the breakdown becomes more repetitive and more frequent in nature then it’s worth start looking into the question, Do you need a new car?
1.1.2 Car MOT has just Failed
We all dread this moment in time when a call is received from the garage stating that Car MOT has failed for drastic reasons. This news could have a serious financial impact and some quick decision making. If the MOT failure is minor and involves consumables like lights, brakes etc then it’s not an issue, just get it replaced and get your car retested. If a more serious issue such as shock absorbers, suspension and mechanical work is involved it may also be workable. However, if there is an emission issue that could have serious implications, maybe a complete exhaust overhaul, maybe the engine has gone past the emission limit. It may be the time when you take into serious consideration the decision to write off the car and move to newer better propositions.
1.1.3 Your requirements are not fulfilled anymore -Lifestyle change
There are several things that can impact your lifestyle, family, kids and job change etc. whatever it is, it may need you to update your vehicle as well. For example, you may need a bigger car or a change of job dictates that you need better commuting cars for motorway conditions.
1.1.4 You want new features – Car upgrade
You may have a perfectly working car that you love but for reasons, you want to upgrade to an automatic car, or you want the convenience of cruise control. There could be other perfectly legitimate reasons which will not constitute the realm of luxury. We all respond to situations and conditions in reality which are changing all the time and sometimes we all have to act accordingly to respond to those changes.
1.1.5 Car efficiency has declined
if the car performance is detectably declining and MPG hence is also worsening, this may be a sign that the general health of the car is deuterating. It could be a simple fix, however, if no number of visits to the local garage seem to improve things, it may be the time to change the car.
1.1.6 Car Tax and Insurance hike
This may be beyond your control however if the insurance provider starts seeing your car as a riskier prospect than before, they will raise the insurance costs. This price increase could be because of car age or some other information available to the insurance vendors regarding your car make and model that you may not be aware of.
Car Road tax also is variable and will change according to government drive and policy. Unfortunately, the change is always up not down, and if you start noticing both insurance and/or road Tax increase has gone beyond a certain limit, it may be the time to change the car to a model/make which is cheaper to tax and insure.
1.2 Petrol, Diesel or Electric – Which one is the best?
The quick and short answer is no one is the best, it all depends on your personal circumstances and preferences. One thing to inspect before we event starts the discussion is the fuel price recent price hikes and fluctuations. It’s out in the open that fuel prices both diesel and petrol have hit the sky setting new records. To put things into perspective look at example below
“An average 50-litre car is costing on average £12-15 more than what it did 45 days ago as of November 2021”
This price hike is global and will continue if the demand for crude oil keeps on increasing. Surely nobody has forgotten the notorious fuel shortage crisis that loomed Britain for a couple of weeks. That was probably for some other reasons as well but it all relates to supply chain issues and price hikes in the global oil price index.
We hope that the price hike is temporary and will eventually come down but not before it takes its victims and toll on the general public. If we keep that in mind is that the right time to buy electric cars? surely we recommend you evaluate the whole situation and carefully examine if you can afford one. If there was ever a time when electric cars would be the right choice due to fuel costs then this is the time. If electric cars are off the menu then hybrids could be a great pick depending on affordability calculators and how much you can invest into this choice. As of now, a decent hybrid used car may set you back up to £18000, while electric cars are much more than this sum. There are few EV rentals and lease schemes available, which take into account the high capital cost of EV and provide affordable and flexible payment terms.
If you are not ready to buy electric or hybrid cars as of now, then make a choice between petrol and diesel. In our opinion, petrol cars are more efficient over short city drives and diesel work better on longer drives.
Engine sizes and MPG is big factor as well. Conventional cars these days are so efficient and perky that you don’t need 2 Litres size of engine for your regular household stuff. Fuel efficiency has also improved big time allowing you to have smaller engines with higher efficiency. The automotive industry has now moved slightly away from bigger and luxury car markets and shifted its trend onto smaller and more efficient engines which are made available to mass consumer markets.
1.3 Legal and Compulsory Costs – Car Road Tax
If you are planning to park and drive your car on a public road system then you need to pay and register for road tax, also known as vehicle excise duty, VED.
- Road tax is calculated using the vehicle carbon emission zone
- It also takes into account Car’s model and makes and age
Bear in mind that road tax calculation is a dynamic process that takes into account fluctuating variables such as inflation, greenhouse gas reduction factor, official policies etc. Especially for diesel cars recently, it has been projected to increase and has increased already in the last few years which is part of the government-driven campaign to eradicate the production of new diesel cars by 2030. Petrol cars are not exemption and their car tax is also reviewed every year.
if we base our decisions solely on the ground of low road tax then electric and hybrid cars are no brainers, most of them carry a £0 tax. if you want to future proof your purchase then do not by any means ignore the road tax considerations.
1.4 Legal and Compulsory Costs – Car insurance
Car insurance premiums could be substantial, so much so, that they can overpass the service and maintenance costs for certain makes. The way it works in the UK using car insurance groups or bands. These groups are spread over 1 to 50. Bigger the group number higher the cost of insurance. These groups depend on certain factors
- High-performance cars warrant more risk hence more expensive group
- If the maintenance costs are higher, higher the cost of insurance
- Price of a new car at the purchase time
- Safety systems such as security and auto braking mechanism drive the insurance price low
Money supermarket has an excellent insurance group calculator
Data copied – courtesy of money supermarket.com
Make sure the model and make you pick, are checked for insurance costs before you make final purchases. This is to avoid any nasty surprises after purchase.
1.5 Pick the Car suitable for your current lifestyle
Make sure that you appreciate the drive or need to buy a new or buy used car and access your current situation and extend it over the next few years to fully understand the need. You don’t want to buy a car that is going to need an update in the next year or so. Whatever it is, a car suitable to your demands and needs will be the best answer regardless of the cost of the car as cost alone cannot dictate the selection.
Autotrader UK has got a very good article on this topic
1.6 Modes of acquisition – How to pay for a New Car
- Cash is often the best and simplest option of all as it will incur extra costs and interests and the car will be yours outright, that is if you can afford the lump sum payment.
- Car finance is a very popular and widely accessible method where you pay an initial deposit for the car which is followed by monthly payments. There is of course interest on payments and if you miss a payment you may lose your car and gain a bump on your credit history.
- Car leasing is a similar concept except that you have to normally return the car at the end of the lease term. It is simply a renting contract that starts with an initial payment followed by a lease payment. Bear in mind car is never yours which implies there is a strict check on mileage and the health of the car. one benefit is there are worries about car value depreciation as the car is not in your ownership anyway.
- You can simply take a loan from the bank and use this case to buy a car. That is only possible if you got credible credit history and lenders don’t see you as a risk. Repayments for loans could be higher depending on terms and interest rates. Car value also depreciates and it’s possible that you may have to sell the car at a lower amount while you still have to repay the actual amount to the bank.
- If allowed at all and under limits, use your credit card to pay for the car. This purchase will be treated by card vendors like any other purchase and payments obviously will be very flexible. Also, any purchases on a card usually fall under the consumer protection act hence card vendor has to support you in case of any miss-selling and issues with the car within the designated period.
1.7 Buy used car- few things to keep in check
Used cars are a very good proposition and can last a long time and actually a very good value for money, if you have already set your mind to buy used car. Most people buying new cars do it for the sake of avoiding the risks which are involved with buying used cars. It can take a great deal of time and research before you shortlist a few candidate cars. There are a few tips that we will mention here to help you understand some of the risks and costs involved.
- There is this difficult question of buying from dealers or independent sellers. There are pros and cons just like anything else in life. Dealers can provide you with some safety and after-sales support which you will not get with private sellers. That doesn’t mean that dealers cannot mis-sell you a car either deliberately or by mistake however chances are pretty low. You are also protected by consumer protection law which will allow you to return the car within 28 days in case of any issues.
- Moreover, you will be normally furnished with 6 months to a years’ worth of car parts and service warranty. Dealership purchases offer peace of mind that will not be an option with a private seller.
- Before you go to the prospective test drive, check the rating for garages using any localised online platform such as google maps or auto trader. Google Maps is an invaluable source of a reputation for a certain trader and has become increasingly popular. All you have to do is search the dealership name in maps to find the feedback. If you don’t find them then there is one more reason not to pick them.
- You will have to be far more prepared in case you buy a car from a private seller although it’s cheaper. You may also want to hire a qualified mechanic to inspect the car for you.
Things to look for when you decide to buy used car.
- Bodywork and any sign of recent repairs
- Look close to and around wheel wells and door frames etc for signs of rust.
- If possible, try to check the undercarriage for signs of rust using a powerful torch
- Check for frame lining and gaps under the hood
- Tyres condition is important
- Ask for timing belt replacement due to date
- Ask for any recent repairs such as clutch etc.
- Check all the lights and other electrics if possible
- Check the car interior
- Start the car and listen to unusual noises
- If possible, test drive the car
All these factors are not exhaustive and there could be many other things you can check. All these steps reduce the risks involved but it doesn’t totally eliminate them.
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