The car market is a complicated place, so it’s perfectly normal to worry that you might not get the best deal, especially when you’re going up against experienced dealers and persistent hagglers.
That’s why we’ve put together this simple list containing six tips for those looking to buy a car, and six more for those planning on selling. Here’s what you need to know.
If you’re buying…
1. Know your budget
It goes without saying that a car is a big investment. There’s not only the upfront cost to consider, but you’ll also need to budget for insurance, fuel, maintenance and repairs. Experts say in most cases you’re likely to spend around 10-20% of your annual take-home salary on a car and its associated costs.
Of course, there are ways to keep costs down. Think about your driving habits and the kind of car that suits them – or, with the cost of fuel so high, you could rethink the ways in which you get around altogether. If it isn’t vital that you have your own car, you could consider using public transport or sharing a vehicle with a partner. Find out more in our guide Ten ways to save on car and travel costs.
If you’re planning on upgrading your car, bear in mind that a pricier model means pricier insurance rates. If you’re planning on downgrading, figure out how much you have been spending on car costs until now to ensure that you’ll actually be saving money with your new vehicle.
If you can’t afford to buy a new car outright, then there are a range of car finance options available which might help you fund your purchase. These include buying the car using a loan, or leasing it instead. Find out more in our article Everything you need to know about car finance.
2. Consider buying used
The prospect of a brand new vehicle is of course tempting, but do you really need to buy new?
Cars depreciate in value extremely quickly, generally falling to about half their value in just two or three years. Even a vehicle that’s only a year or two old tends to go for much less than one fresh off the production line. When you consider that many of these cars are still in perfectly good working order, buying used can start to feel like a no-brainer.
Of course, buying used comes with its own set of considerations, particularly if you’re buying from an individual rather than a dealer. Inspecting the vehicle during the daytime in good weather, checking it isn’t missing any key components, and taking it for a thorough test drive are all crucial. If you don’t think you’d be able to spot any potential issues, it’s worth booking an expert to give the car a once over before you buy. For example, the AA offers a pre-purchase check service which costs from £142 for a basic inspection and from £192 for a more comprehensive inspection. Find out more here.
3. …but don’t get scammed!
Unfortunately, there are several ways in which scammers will try and flog a vehicle for more than it’s really worth. If you’re buying used, keep your wits about you and learn to spot red flags as this could save you a lot of headaches later on.
- Clocking a car is the criminal practice of lying about a vehicle’s mileage in order to increase its value on the market. Scammers can even tamper with the odometer on the dashboard in order to make the mileage look lower than it is.
If the seller says the mileage is very low, but the car shows signs of wear and usage – such as a shiny steering wheel, well-worn seats and seatbelts, or worn-down pedals – you might be looking at a clocked car.
Compare the mileage on the dashboard to the one listed in documentation provided by the seller. You can also check the MOT history of a vehicle on GOV.uk simply by entering its license plate number, to see if the mileage reported there matches up with what the seller is saying.
- Cloning is the act of fitting a car with number plates from another, identical vehicle. This is done to hide the fact that a car is stolen, or to pass off speeding fines and parking tickets onto another unsuspecting car owner.
To avoid buying a cloned car, you should check that the number plate matches up with the one listed on its vehicle logbook, or V5C, a document which all car owners are required to have. You can also cross-reference the Vehicle Identification Number (VIN) on the logbook with the one found on the vehicle – on the car this is usually found at the base of the windscreen, inside the driver’s door, or under the bonnet. If there are any discrepancies, or the owner cannot provide you with the car’s V5C to begin with, this is usually a sign to steer clear.
- While they are highly uncommon, cut-and-shuts are cars that are welded together from the remains of two damaged cars and presented as one vehicle. If done well, these can be hard to spot – but are also likely to be very dangerous.
Look out for uneven panel gaps, inconsistencies in the paint job, or places where the paint has been oversprayed onto the glasswork. If you have any doubts about the legitimacy of a vehicle, you can get an HPI check to find out if it’s been stolen or written off.
Compare cheap car insurance quotes
Car insurance renewal premiums have a habit of increasing every year, even if you haven’t made a claim. Compare car insurance quotes from over 110 UK providers – you could save up to £530* per year.
*51% of consumers could save £529.95 on their Car Insurance. The saving was calculated by comparing the cheapest price found with the average of the next five cheapest prices quoted by insurance providers on Seopa Ltd’s insurance comparison website. This is based on representative cost savings from February 2024 data. The savings you could achieve are dependent on your individual circumstances and how you selected your current insurance supplier.
4. Consider going electric
With petrol and diesel prices at record highs, many motorists are looking to make the change to an electric car. These vehicles offer a whole host of benefits, including quieter, smoother driving, lower maintenance costs, and cheap, convenient charging, not to mention you’ll be doing your bit for the environment.
The downside is that the upfront cost of an electric car still runs higher than a fuel-powered model, as do insurance rates, and there are also concerns about steep battery replacement costs. Our guide Should I get an electric car? explains everything you need to know.
5. Don’t go for expensive add-ons
If you’re buying from a dealership then it’s all too common for them to try and throw in a bundle of insurance add-ons once the deal is nearly complete, such as GAP insurance (this is designed to cover the difference between the amount your insurance provider will pay out if your car is written off or stolen and the amount you’d need to pay to buy a new car) minor damage cover and tyre insurance. Don’t be tempted by these add-ons until you’ve compared how much standalone cover costs – most of the time, dealers are hoping you’ll default to them as the easiest option and not think too hard about the cost, since when you’re spending thousands on a vehicle, a few extra hundred can feel less significant.
However, it’s for this exact reason that these add-ons tend to be much more expensive than what you can get with a bit of research. Only go for policies that you really think you’ll need, and always compare quotes on these from a variety of sites, rather than jumping at the first option.
You can use this tool to compare car insurance quotes for people over 50 from over 110 providers.
6. Don’t be afraid to negotiate
Being able to haggle for a better deal – whether it’s a discount or something thrown in for free – is a really useful skill and could save you hundreds of pounds when buying a car.
If you’re buying from a dealership, find out what the cheapest deals are for your ideal car online and bring these figures with you. If you’ve found a better deal than the dealership is offering you then you’re already in a good position to ask for a discount. If they say they can’t offer a discount then try coming at it from the opposite angle and ask if they can throw in anything for free.
Experts suggest that haggling is easier when it comes to cars that have already been discounted, because the dealer has already given up on trying to sell it for the full price.
Another common tip is never to sign on the spot – wait for them to chase you up over phone or email. If you show interest but also exercise enough patience, there’s a good chance they’ll come to you with a better deal.
If you notice a flaw that wouldn’t put you off the car – but also hasn’t been listed by the owner – you might be able to negotiate for a discount by pointing it out. Even small dents and scratches can knock off a good few pounds if you play your cards right.
If you’re selling…
1. Figure out the best way to sell
There are different avenues which you can use to sell your car, and the best one for you will depend on what your priorities are. For example, are you willing to wait to get the best possible price for your car, or do you want to offload it as quickly as possible?
If you want to sell it quickly for a decent price, then selling via a car buying website may be your best bet. These are designed to net you a quick sale from whichever dealers or professional buyers is willing to pay the most, based on the information you provide. Sales are almost guaranteed on these sites and can sometimes take less than 24 hours, with the downside that you will probably not get the same amount you could from selling privately. Car-buying websites include WeBuyAnyCar, the Car Buying Group and Motorway.
If you’re not in any rush and want to fetch the maximum price possible for your vehicle, then selling privately will probably be the way to go. This does mean advertising the car, meeting potential buyers and going through negotiations yourself, but what you lose in convenience you will hopefully make up for in cash. Auto Trader is the best-known forum for posting used car ads, though eBay, Gumtree, Facebook Marketplace and Motors.co.uk are all reliable options as well.
2. Know your car’s value
It almost goes without saying that you should do your research and settle on a realistic selling price for your car before putting it up for sale.
Cars depreciate in value very quickly – so you’ll need to accept that even if your vehicle is relatively new, you’re unlikely to be able to sell it for anything near to the price you paid for it. Factors that affect the value of a car besides model and age are mileage, condition and service history.
Many websites will give you a quick, free valuation, such as a WeBuyAnyCar, Parkers, the AA and AutoTrader, though these are usually based on make and mileage alone. Try searching for cars with the same attributes as yours on the market to see how much other people are selling for. All of these figures should be able to help you arrive at a realistic selling price.
3. Prepare your car for sale
Getting your car in the best possible shape will make it much more attractive to potential buyers. Even just giving it a good clean both inside and out before taking any pictures for a listing can go a long way to making your vehicle look more tempting.
Take it to the carwash, or give it a thorough clean on the outside at home. Vacuum the inside and make sure there’s nothing left in the glovebox or seat pockets, and put in an air freshener to get rid of any unwanted odours. Some scratches can be removed with car polish, wax or even toothpaste, so if you’re able to get rid of them, definitely do.
Make sure the tyres, windshield and wipers are all in good shape as well, and make any minor repairs or replacements as needed. Fill up on coolant, washer fluid and brake fluid too, and get an oil change if you haven’t in a while. These aren’t just considerate things to do – they’ll give potential buyers fewer ways to negotiate a lower cost.
If you’re not confident in any of these steps, and you can afford to do so, you can pay a valet service to have it done professionally.
4. Know the law and get the documentation right
In order to legally sell a car, it must be roadworthy and fully match the description you provide.
You’ll need to be able to provide the V5C logbook, which acts as proof of ownership. It’s fine to let potential buyers have a look at this before completing a purchase, but don’t hand it or any copies over beforehand.
Once the car is sold, you’ll need to fill out the relevant sections in the logbook (section 6 and 8 for private sales and section 9 when selling to a trader, dismantler or insurer) and post it to the DVLA, or inform them online via GOV.uk. Then, there should be a green ‘new keeper’ slip which is given to the buyer.
It’s also helpful to have MOT certificates and service history at the ready – some buyers will cite a lack of history as a reason to knock the price down. If you can get an MOT test done with a fresh certificate to offer before you sell, all the better.
If there is outstanding warranty on the car, be sure to let the company know that you’re selling it. In some cases, the warranty will be transferable to the new owner, in which case you should let them know what the remaining time period is and provide them with the warranty documents.
If a buyer is paying with a deposit, you’ll need to provide them with a receipt as confirmation, and keep one copy for yourself – this is called proof of reservation. Once they’ve paid full price and the deal is finalised, you’ll need to provide a proof of purchase receipt as well. These should include the sale date, registration number, car make and model, and both parties’ names and addresses. The AA provides a template which you can use for both – for the proof of reservation, just fill in the amount paid as a deposit. Then for the proof of purchase, fill in the remaining sum. If they are paying the full amount in one go, you’ll only need the proof of purchase.
In other words, you should end up with four receipts total (two each) if they are paying with a deposit, or two receipts total (one each) if they are not.
Remember that reserving a car is not the same as buying it, and you should never let someone drive off with your vehicle until you’ve been paid in full. It’s best not to accept cheques for this reason – make sure you’ve been paid in cash or via a bank transfer and that the money is 100% yours before you hand over the keys.
5. Be ready to negotiate
Don’t be offended if a potential buyer tries to haggle for a lower price – it’s a normal part of the process.
Following the previous steps and ensuring you have all the information they’ll need about the car’s history will give buyers less room to work with and help you justify not budging on the price. If you’ve done your research on similar cars on the market and think yours is a fair price comparatively, this can be useful to bring to the table.
It helps to have a margin in mind for how low you’re willing to go – this way, the buyer can have the satisfaction of having negotiated for a better deal but you won’t feel you’ve lost out.
6. Cancel insurance and reclaim road tax
The DVLA isn’t the only organisation you’ll need to notify when you sell your car. If you still have an active insurance policy, make sure to contact your insurer to cancel this as soon as possible – bearing in mind you may have to pay a cancellation fee. If you’re buying another car which you’ll need insurance for, our article 10 practical tips to reduce your car insurance premiums suggests some simple ways to reduce your costs.
You should also be eligible for a refund for any full months left on your vehicle tax that you have already paid. Simply visit GOV.uk and follow the steps listed there.
Rest Less Money is on Instagram! Check out our account and give us a follow @rest_less_uk_money for all the latest Money News, updated daily.
Compare cheap car insurance quotes
Car insurance renewal premiums have a habit of increasing every year, even if you haven’t made a claim. Compare car insurance quotes from over 110 UK providers – you could save up to £530* per year.
*51% of consumers could save £529.95 on their Car Insurance. The saving was calculated by comparing the cheapest price found with the average of the next five cheapest prices quoted by insurance providers on Seopa Ltd’s insurance comparison website. This is based on representative cost savings from February 2024 data. The savings you could achieve are dependent on your individual circumstances and how you selected your current insurance supplier.