Buying a new car

In the market for a new motor

Buying a new car gives you the latest advances in safety and security, comfort, performance and fuel efficiency. Plus you can have the engine and trim specifications you want.

You'll also get a manufacturer warranty, won't have to face an MOT test for 3 years, and there may be special offers on servicing.

But there are pitfalls to be avoided. Hidden extras can bring nasty surprises, and there's the initial depreciation.

So before you reach for the cash, make sure you're prepared for the showdown at the showroom. Here's the hit list.

Work out your budget

The basic cost of driving
  • Depreciation – Aim to keep the car for at least 3 years to spread the loss in value.
  • Car insurance – The premium could go up, so shop around for a new deal.
  • Car loan – If you need one, arrange it before visiting the dealer, you'll almost certainly get a better deal than their car finance.
  • Car tax – Your new car will be taxed on its CO2 emissions in the first year, and then a standard rate from the second year depending on the engine type. If your new car has a list price of over £40,000, there's an extra charge of £310 a year in the first 5 standard rate years.
Are extras in the basic price?
  • Delivery and number plates.
  • Special features you want.
Part exchanging your car
  • Haggling – Beware, many dealers will have allowed for bargaining in their price.
  • Your car's value – It's based on age, condition and mileage. You can check its valuation online.
  • The 'cost to change' – If you negotiate a good discount on a new car, you're unlikely to get a generous trade-in for your old car.
  • Selling privately – You should get more than the part exchange, but it can be time consuming and stressful.
  • Be wary of advertised minimum trade-in offers – They look attractive, but may be available only if you take the dealer's car finance.

Read the small print

Spend some time going over the warranty conditions before you sign. For example, you may need to fork out for routine checks to ensure the long-term anti-corrosion warranty remains valid.

Car manufacturers can't insist that you get the car serviced by a franchise dealer during the warranty period. But you must still get it serviced according to their recommended schedule, using only manufacturer approved parts. And you'll have to keep records so you can demonstrate to the manufacturer that servicing was undertaken to their requirements.

It's worth bearing in mind that if anything goes wrong shortly after the warranty expires, a manufacturer is more likely to show goodwill towards any claim if the car has been serviced by one of their dealers.

And don't be pressured into buying – walk away if you're not completely happy.

Finally, pick up your new car
  • Don't pay until you're satisfied with the collection or delivery arrangements.
  • Collect the car when the dealer is not busy, so that they can help you to familiarise with the controls and any set-up required.

23 March 2012

Buy car insurance

Star rated car insurance from a name you can trust