A guide to buying a used car

Covered mag, presented by Gocompare.com
  • | by Dave Jenkins

Brand-new cars notoriously lose value within minutes of driving them off the forecourt, so can you really justify showroom-fresh luxury and that new car smell? A used car might be a better option. But according to usedcarexpert.co.uk, one in three cars is hiding something, so it’s essential to get informed before you make your move.

Over the next few weeks we’ll be explaining the best ways to navigate the used car minefield. We start with a guide on who to buy your car from...

Franchised dealers

This has the potential to be the most expensive option, but it might also be the safest, as buying from franchised dealer affords you protection from the Sales Of Goods Act. A warranty is in force, and the dealer has to ensure the car is roadworthy. For example, if the tyres are at their lowest legal tread, they have to change them, saving you a the expense month or two down the line.

“Franchised dealers usually offer newer cars with less mileage,” explains Matt Sanger, used car editor at What Car? magazine. “Repairs will have been sorted out and it should come with a full service history as well as a spare set of keys. Many of them have better finance deals too.”

Car Supermarkets

The clue’s in the title. Supermarkets work on economies of scale so the cars are usually cheaper than a franchised dealer. Unlike the franchised dealer, they’re looking to make hundreds and not thousands per car.

There are potential benefits. If you need to see as many cars as possible, here’s where you can do it. You might not receive the same forecourt personal service and complimentary cups of coffee and you may find that many of the small repairs that a franchised dealer will attend to before they sell it won’t be made.

Online

Purchasing a used car online is one of the last taboos when it comes to internet retail. But it’s not as a ridiculous as you’d assume. “A lot of people think it has potential to be the future for car sales,” states What Car’s Sanger. “There’s often a 7 or 14 day cooling off period, prices are generally good because there’s no forecourt or sales staff overheads and you have access to the vehicle’s previous reports and history.”

Independent dealers

The days of dodgy second hand salesmen are all but a distant memory, but they’re still out there. If the dealership is legitimate then your buyer’s rights will be valid. They also often have trade connections, and might just have that particular model you’re after. Just make sure they are a genuine independent dealer and registered with the Retail Motor Industry Federation before you visit them.

Private sellers

A riskier option, but one that could pay off. Always remember the seller will likely to be getting rid of the car quickly. But, you need to check if they’re not a two-bit dealer masquerading as a private seller. This is something that the Office of Fair Trading estimate makes up for approximately £41.4m of sales a year!

It’s easy to spot the shysters, explains Tim Shallcross, Head Of Technical Advice for the Institute Of Advanced Motoring. “Just ring them and ask about ‘the car’. If they ask which one hang up as it’s not a private sale.”

You can also tell if it’s a legitimate private sale by insisting on seeing the car at their house. If a new car is on the drive then you’re likely to have found a kosher seller. If they refuse, then something fishy could be afoot. Check that the contact number doesn’t appear on several adverts, and whether the name on the car’s log book is the seller’s. You’re checking the seller out as much you’re checking the car.

Your buyer’s rights are not as secure with a private sale, but you do have some protection. Consumer Direct states that while there is no legal requirement for the car to be of satisfactory quality or fit for purpose, “the car must be as described and must be roadworthy.” So if a private seller misleads you about the condition of a car, you can sue for your losses - that is if you can find the private seller after the sale…

Auctions

This has the potential to be one of the riskiest ways of buying a car, but also a way to get a bargain if you’re savvy. Try and visit least two auctions without any money whatsoever to prepare yourself. Watch how the process works, as it’s easy to get carried away.

If you decide on visiting an auction, go with a friend who’s in the know, and read the auction house’s terms and conditions. Cars are usually sold ‘as seen’ at auctions, meaning minimal legal protection; you’ll only settle matters if you can show that the auction house misled you. Set a maximum price, and make sure you stick to it.

Above all, whoever you decide to buy your car from, your research and vehicle inspections are essential.

A used car is a big investment, yet a 2009 study from The Office of Fair Trading revealed that nearly two thirds of buyers don't get any general advice before making a purchase.

The prospect of being sold a ‘cut-and-shut,’ a stolen car, or one with a former owner still contracted to a finance deal means that only fools rush in. And there’s a lot more to a thorough check than kicking the nearside wheel…

Be prepared

“Remember there are thousands of cars on the market at any one time,” warns Tim Shallcross, head of technical advice at the Institute of Advanced Motoring (IAM). “The one you fall in love with today could be your biggest worry of tomorrow.”

Do your research

Learn the value of the car you want. Search its common traits and problems. Usedcarexpert.co.uk lists all known faults with most models, and it’s free.

Get covered for your test drive

Dealerships sometimes have car insurance policies in place; private sellers don’t! Check your own policy to see if you’re able to drive another car with the owner’s permission. If not, think about a temporary insurance policy.

Get acquainted

Recruit a mechanic. If you don’t know one then call on the services of a qualified engineer. Independent vehicle inspections cost over £100, so your pre-visit homework needs to be thorough. Check the car yourself first. If you’re really interested, return with a mechanic.

Consider your budget

“It depends how much you’re spending,” advises Matt Sanger, used car editor at What Car? magazine. “If it’s £2,000 or under, make sure your money goes as far as possible and do your homework. Know exactly what you’re doing and have a decent test drive.”

Paperwork

There are lots of data checks available, which will tell you whether there’s any outstanding finance owed on the car, if it’s been a write-off or whether it’s been stolen. Ask for the registration, Vehicle Identification Number and MOT certificate number.

The Vehicle & Operator Services Agency offers a full history check via the MOT certificate number. It will even tell you whether the tyres need changing soon.

Ask the seller immediately for the vehicle’s log book (VC5). It’s the final test to make sure the car is legal and belongs to the person who’s selling it. Check the watermark and contact the DVLA to ensure it’s all above board.

Engine and bodywork

Before you start the motor, pop the bonnet. “Open the oil cap,” says Shallcross. “If there’s a creamy fluid that looks like a latte the head gasket may have blown.” Now, check the dipstick: if the level is low, or it looks decidedly black, then it’s a sign of poor maintenance or excessive oil consumption. There’s one exception to this rule; if you’re buying a really old, cheap car and the oil looks like it’s been recently changed, alarm bells should start ringing. A fresh oil change will mask various large problems waiting to happen.

Request a cold start. Starting up a cold engine will tell you more than one that’s recently been running. How does the ignition sound? If anything rattles, then it’s a sign of something being badly worn. Check all switches and icons on the dashboard.

Walk around the car and look for any discrepancies in colour. Look for dents and rust and keep them in mind when it comes to the final price. You may also find evidence that the car is a ‘cut-and-shut,’ a potentially dangerous amalgamation of two damaged cars. These can be hard to spot. Look under the carpet, check for any joins in the sills. Ill-fitting seams are another sign of cut-and-shuttery. It’s very difficult to disguise a weld.

Mileage

Incredibly, it’s not actually illegal to alter the mileage on display! The Office of Fair Trading reckons there are around 50 businesses in the UK openly offering 'mileage correction’ services. If the mileage seems low, look for other signs of wear and tear such as worn steering wheel or pedals. Older, pre-digital display cars that have been tampered with may show signs of skulduggery around the screws of the dash.

Test drive

Take around 30 minutes to put the car through its paces. Take the car over as many bumps as possible, and listen for rattles under the car. These are a sign of worn suspension. Drive down a hill in third gear. Put the load on and take it off. If it feels jerky then the gear box is gone. After 20 minutes’ drive, let the engine idle and see if there’s any grey smoke or an acrid smell coming from the exhaust. These are signs of a worn engine.

Set your price

Don’t set an unrealistic budget and always consider the running costs. How much is the tax? What insurance group does the car fall in to? Have you done a car insurance quote? How much fuel does it consume? Think ahead; who’s going to buy a three litre gas guzzler in the future? “If you’re looking at older cars, say under £2,000, then only spend three quarters of your budget,” says Tim Schallcross, head of technical advice at the Advanced Institute Of Motoring (AIM). “It’s more than likely it’ll need some form of repair or maintenance.”

Loan or save?

If you’re considering a loan then visit your bank first. It will know about your spending habits and the rates if offers are likely to be the most favourable. But banks are a lot more conservative when it comes to granting loans these days. If an independent finance company is your only option then shop around and ensure your choices are well informed as rates vary dramatically.

Forecourt or dealership sales often have their own car finance schemes in place. Compare the rates to others you’ve seen, and remember that the seller usually has a vested interest in you taking that loan themselves.

Current trends are leaning towards borrowing closer to home. The luckiest people are those who can benefit from a loan or gift from close relative. In fact more than twice as many 18-24 year olds (10 per cent compared with 4 per cent last year) seem set to enjoy such generosity, according to figures from the AA. But not all of us have this privilege and if you are borrowing the money give serious consideration as to whether you want a loan of three years or more…

And so the game begins. Loaded with loot, you’re now ready to engage in the best part of the used car buying experience. Play this well and you could make a big saving.

At the forecourt

Meet the car salesman. He’ll act like your best buddy, but he’s really not. It’s his job to sell you your car at the highest price possible so be sure to bear the following points in mind:

- You are always in control. You’re the one with the money and never forget this, no matter how much a salesman will try and turn the situation around.

- Body language can tell you a lot. Watch how the salesman shakes your hand. If his palm is face down he’s going in for the kill; he’s forcing you to put his hand under his. This is known to psychologists as the ‘dominant handshake.’ A great way to get out of this is to follow the lead of Allan Pease, an Australian psychologist and self-styled ‘Mr Body Language’. “Step forward with your left foot as you reach to shake hands,” says the expert in his book, Body Language. “Next, bring your right leg forward, moving left in front of the person and into his personal space. Now bring your left leg across to your right leg to complete the manoeuvre, and then shake the person’s hand. This tactic allows you to straighten the handshake position or to turn the other person’s hand into the submissive position. It also allows you to take control by invading the other person’s intimate zone.”

- If you’re buying from an independent dealership then don’t be alarmed by his gruffness or lack of connection. This is another trademark way of taking control of the situation. He’ll change his tune when he realises you’re serious and all the regular skill of the salesman will come into play.

- If you’re part exchanging your old car then make sure you know the trade value of your car as that’s all you be getting….even if they juggle the numbers up to confuse you. - If you’re in a relationship, take your other half. If you’re not, take a friend and pretend. The salesman will never, ever give you the best price if you both agree on how great your new car is. Why should he? He needs to see you leave with the car, so if you’re quarreling he needs to appease you. It’s a classic good cop/bad cop situation and there’s a whole minefield of issues you can ‘argue’ over such as the car’s fuel economy, its price, whether or not it was as good as the one at the other forecourt, for instance.

- However, always remember that if you leave that forecourt you will never get the same price on return. You’ve blown it; he knows you can’t find anything better and you’re putty in his hands

- Finally, if your deal involves a part-exchange don’t let him have your keys. He has no need for your keys until you’ve signed the paperwork. This is just a simple ploy to keep you in the forecourt for as long as possible!

From a private seller

Buying from a private seller should be a much friendlier affair. If he’s legitimate then there should be no hard sell. However, there are only a few issues to pay attention to in this situation...

- The best way to get the price down is to compliment it and say it’s out of your budget. If you start trying to knock down the cost by criticising certain things that need attention, you’re essentially criticising the owner. On the contrary, you should tell them you love it.

- “Take the cash with you,” advises Tim Shallcross. “Show it, but walk away. Very few people can deny the ready money in this situation.”

- Have fun with the situation! If you’ve done your homework and worked out who you’re buying your car from, what you’re getting and how to inspect it, you’re going to walk away from this situation with a new used motor.

To conclude…

Be brutally honest about the deal. The price or type might be blinding you to some obvious faults. If it all sounds too good to be true, it usually is.