The Pains of Buying a New(ish) Car | Christopher Winter
I recently decided that I had finally had enough of my old car. Now, when I say, ‘old car’, I don’t mean it in the colloquial sense of ‘a car which I used to own’, I mean it in the sense that my previous car was actually older than me. Since I was 17, I have been driving around in a 1999 Toyota Corolla. You may ask yourself how a young man could bring himself to want to drive around in a car built before he was even born? How could he stand a car that had a cassette player and winding rear windows? The answer is twofold: money (or a lack thereof); and nostalgia.
When I first started driving that car, I was not in a position, economically, to afford a newer one. The car had also belonged to my grandfather and it, therefore, holds a very special place in my childhood memories. With a British racing green exterior, an old leather interior, and a 1.3 litre petrol engine under the bonnet, she certainly has been a pleasure to look after and drive, and for those of you who are fearful of the future of my old car, do not worry; she is safely stored away, waiting to be used again, someday soon – I simply couldn’t bring myself to take her in to be scrapped.
But, as the title of this article isn’t ‘Chris Talks to You About His ’99 Corolla’, I must swiftly move on to what I really wanted to talk about: the aches, pains, and strains of buying a new(ish) car. This article is mainly pitched at younger people who may have never bought a car before and are wondering how to go about it. This guide is based off my experience with purchasing cars. There are no set rules to buying a car and you may wish to buy one completely differently.
First things first, can you afford to buy a car? There are many ways of going about paying for a car. Some people purchase a car in full, with cash, and own it outright. Most people, however, purchase a car through finance with a set number of monthly payments (usually over 3 to 4 years). If you choose the latter option, you will not own the car fully until you have paid off the loan you took from the dealership company you bought it from.
If you work a job and have established credit, buying a car on finance should not be a problem. If you don’t however, you are probably going to have to ask one of your parents to buy the car in their name or be a guarantor (as a car dealership is less likely to say yes to you in that scenario); so, if having the car registered in your name and not your parents is important to you, then you will have to wait until you have a job or can buy the car outright.
When buying with finance, you will have to pay a lump sum deposit. You will then also be expected to pay a ‘balloon payment’ at the end of the set number of payments. At this point you can either give the car back and not pay anything or buy the car by paying the balloon payment. When you purchase the car, you will be set an annual milage limit, if you exceed this milage limit then you will be charged by the dealership if you wish to give the car back to them at the end. You do not have to pay this fee if you pay the balloon payment and fully buy the car, however.
Step two: finding the cars in your price range. I am going to assume that you have decided to buy your car through finance with the help of your parents, as that is what most young people do when buying a car. So, how much money are you willing to spend a month? Most affordable new cars are going to start off in the £190 to £250 a month bracket, however, a second-hand car can usually be bought for between £120 to £210 a month depending on the dealership. So have a good long think about how much you are willing to spend a month for your new motor, as, if you fail to make your payments, it is your parents credit score and wallet which will suffer.
Step three: think about what ‘type’ of car you want to buy. For the less car savvy amongst you, you may not realise that there are many different body types of cars. Most major affordable car companies will offer a wide range. However, as a young first-time buyer, you are probably only interested in a few: City Cars, Superminis, Hatchbacks, and (potentially) Compact SUVs. City cars are the smallest of the group. They are good for the compact environment of inner-city life and are characterised by their excellent fuel efficiency, lack of rear doors, and terrible storage space. Next is the supermini. Superminis are slightly larger than city cars and, as such, have larger storage capacities. They also normally have rear doors as well. Still useful for inner city driving but also good for driving out to the suburbs and long-haul trips to the supermarket. Following on from the supermini is the Hatchback. Hatchbacks are a good all-round car for use in most environments. Less compact than city cars and superminis, they boast a large amount of storage and passenger space and are the pick of choice for most young people and new families. Finally, the compact SUV. The C-SUV has a tremendous amount of storage space but will struggle in city centres. If you live, commute, and work in the city, don’t pick a C-SUV. However, if you are a country bumpkin who must nip up and down country lanes all day every day (such as myself) than a compact SUV may not be so foolish a choice. Obviously, there are a plethora of other car types to choose from, but I do not feel as though many first-time buyers will be that interested in sedans, minivans, or saloons etc.
Step four: consider what features you couldn’t live without, and which are not important to you. Cars have different trim levels with ‘basic’ models being sparser on features and higher-level models having more extras. There is no point paying more for a car with a higher trim level if you have no intention of using its features. Buying a second-hand car will constrict you a little bit of this liberty, but if you intend to buy a new car you will find yourself with a lot of ‘additional extras’ being offered to you that you probably don’t actually need. When I was choosing my car, the only features I was bothered about were cruise control and a Bluetooth infotainment system and that is what I came out with. So, make sure you think about that too! Otherwise, you may end up spending more than necessary.
Step five: think about what make and model of car you want. The make and model of your first car is a big decision, it will dictate how you feel about that brand for the rest of your life. As a rule of thumb, German, Japanese, and South Korean cars are usually of the highest reliability and build quality. Brands like Toyota, Mazda, Hyundai, Mitsubishi, and VW, etc. These cars are, however, usually more expensive as a result. If you intend to look at buying from a cheaper brand, then a good trick is to look at the parent company of them (such as Skoda or Dacia which are owned by VW and Renault respectively) and consider whether their parent company is trustworthy. Most budget car brands have a parent company so keep this in mind. Also, think about what else comes offered with the brand. If the manufacturer offers a long warranty, then they clearly have a lot of trust in their cars. Do your research online! Car websites are usually straightforward, and all have a very similar layouts.
Step six: visiting a dealership. Now that you are clued up on what makes and models of cars you are thinking of, visit their local dealerships in your town. Dealerships normally sell new and used cars in separate areas on the same site, so don’t be surprised to see salespeople darting all over the place. A lot of customers are wary of salespeople, and this is understandable. But it is important to remember that they are only there to help you find a car. It is imperative that you are clear in your communication of what features you want and what kinds of cars you have been looking at. Remember, you are in control of the situation and can walk away from a deal at any point until the paperwork has been signed. So, relax and be easy to talk to. It will put the salesperson at ease and help them find you the car you want. Car Salespeople are usually not cartoonish ‘Lionel Hutz-esque’ con artists, but at the end of the day, they are sellers, and they are going to try and sell you things that you might not want. If this occurs, just politely say no, and carry on with your browsing with them. Trust me, they won’t take it personally.
Step seven: Fiddling with all the nobs and buttons. You will be shown around the cars by the salespeople and they are probably going to start opening car doors for you to let you go inside. Don’t be afraid to get in and have a good sit. Play with the dashboard buttons and feel for the position of the cars features. Move the chair and steering wheel back and forth. Is it comfortable? If you purchase this car, you are going to be feeling these surfaces for quite a while. So, make sure you pick something you like. Come up with a shortlist of cars you like the look of at that dealership and then request a test drive. The salesperson will almost undoubtedly say yes, and you can go for a short drive to try and get a better feel for the car. Repeat steps six and seven at multiple dealerships until you find the best car for you.
Step eight: making the purchase. As discussed in step one, you are probably going to buy the car through finance with the help of your parents. The salesperson will probably attempt to offer you an extended warranty and/or an annual service plan. Personally, I declined the warranty extension but did take up the service plan just for the added peace of mind. If you intend to buy the car at the end of your monthly payments, make sure to set your annual mileage limit as low as possible (usually between 5,000 to 6,000 miles pa) This will keep your monthly costs low and, as you intend to buy the car, you will not have to pay the fine at the end for driving over the mileage limit. However, if you intend to give back the car at the end of your monthly payments, request a more typical annual mileage (between 7,000 to 10,000 miles pa). You will pay slightly more per month, but you will avoid a large fee at the end for driving over the set mileage limit. Once you have decided what extras and annual mileage you want, they will need to see the ID of the person taking the loan and their credit card. Those cards will be taken off into the office and within about twenty minutes they will come out with a finance offer for you. If the offer is acceptable, sign it and congratulations you are the owner of a new (or newish) car.
Finally, once the car paperwork has been signed and handed over, you will be asked to provide details for the car’s road tax. The dealership has a legal obligation to ensure that the car is taxed and so they will go through the tax with you as soon as it is purchased and make sure that you are road legal. This will come at a small fee depending on the emissions of the car. Remember, you can’t drive your car off the lot until you are insured so make sure that that is arranged the day before. (Yes, you can insure a car that you don’t own yet, and most people insure cars this way).
Well, I wish you the best of luck in your search for a new car. I hope that this guide has been somewhat useful for you and has perhaps put you at ease.