The latest national lockdown places severe restrictions on our mobility but purchasing a vehicle from a dealer has never been easier. Thanks to the rise of fully digital automotive retailers and quick-thinking dealerships offering contactless click & collect or home delivery services, motorists can purchase a vehicle without ever leaving the comfort of their own home.
This has led to a sharp rise in online car purchases, as revealed by a recent survey which showed that 57% of motorists believe that a fully digital purchase journey would benefit the consumer. Despite consumer sentiment and these advancements in the automotive retail industry, purchasing a vehicle is still a major decision and we take the stress out of the process with our guide of useful tips.
Know your personal budget
Whether you are paying upfront or in monthly instalments, it’s important to establish an affordable budget and to stick to it. Transferring too much from your personal savings when paying upfront could cost you in the long-term, especially in challenging economic conditions. Similarly, with monthly instalments, ensure that you can afford the monthly repayments for the entire duration of the contract. Also do some research into what finance options best suit your needs – whether that be a personal loan or vehicle finance. The Money Advice Service offers more detail on choosing the best way to finance the purchase of your vehicle.
Make sure to understand all costs associated to the vehicle, not just the list price
The good news is that you’ve established exactly how much you can afford; the bad news is that there are more associated costs that are most often not included in the list price that you now have to factor into your budget. The primary additional costs include:
Car insurance: All UK cars fall into one of 50 allocated insurance groups to help insurers calculate the cost of cover, with 1 being the cheapest and 50 being the most expensive. But this is just the first step in determining the cost of a premium, other major factors include the driver’s age, driving history, occupation and primary location of the vehicle.
Committing to an annual policy on the spot may not always be the best choice when purchasing a new vehicle and in this case a temporary car insurance policy could be more suitable. Policies can be taken out to cover anywhere between 1-hour and 28-days, and drivers can obtain fully-comprehensive cover in 90 seconds through an entirely digital quote and buy process, which fits in line with the evolving consumer purchase trends. This takes the stress out of insuring the new car and gives the driver the opportunity to thoroughly research the best annual policy to suit their needs. An added benefit is there’s no risk to any existing No Claims Discount, as it’s a separate and standalone policy.
Service/maintenance plan: Service and maintenance plans are generally available on cars that are three-years-old or under. It is entirely dependent on the dealer whether this is included in the list price or sold as an optional extra. In both cases, it is worth checking with the dealer. If the car does not come with a service plan, it is essential that you still service the vehicle independently. This should be done every 12 months or 12,000 miles, whichever comes first. Failing to service a vehicle regularly could not only put your safety at risk, but it could also lead to catastrophic malfunction that far outweighs the cost of servicing to repair.
Road tax/MOT: Car tax must be paid on all vehicles registered in the UK, driven on or kept on a public road. When the vehicle is first registered, you need to pay for 12 months. Thereafter you can choose to pay car tax every 6 or 12 months at a different rate. The actual cost of car tax varies greatly between vehicle makes and models. It is calculated according to vehicle value and CO2 emissions. You can find out the cost of taxing your vehicle using the government’s online calculator.
An MOT certificate confirms at the time of the test that your car meets the minimum legal road safety and environmental standards. It doesn’t mean your car will remain roadworthy for the following 12 months. You still need to make sure you maintain your car well, including regular servicing. The maximum fee that testing stations can charge for an MOT inspection is £54.85. However, the cost of getting the car up to spec to pass the MOT entirely depends on how much work needs to be done.
Research prices and compare offers (reputable dealers only!)
There is a myriad of choices online, so narrow down your search to your preferred vehicle brands that fall into your budget and compare dealerships. There is always likely to be one seller that offers that little bit extra that closes the deal for you, whether that be a short-term driveaway insurance policy, moneyback guarantee or even a full tank of fuel included in the list price.
Reputable dealers such as Arnold Clark, Cargiant, Cazoo and Motorpoint all offer short-term driveway insurance policies as part of the vehicle purchase journey, which means that customers are provided with fully comprehensive cover for the period that their vehicle is under moneyback guarantee. Customers do not have to invest time and money in adjusting their annual policy for a car they might not purchase. And if they are happy with the vehicle, they can research the annual policies that best suit their needs while they still have temporary cover.
Which? Car provides a fully-detailed list of the types of dealerships available and highlights potential advantages and disadvantages to help you determine which experience is best for you. Regardless of where you purchase your vehicle from, you can still obtain fully comprehensive short-term car insurance within 90 seconds following a simple online experience.
Thoroughly inspect and test drive the vehicle
One of the downsides of completing an entirely online vehicle purchase is that you do no get to physically see the vehicle first. But all top dealerships provide full peace-of-mind by offering their customers a full money-back guarantee once they take delivery of the vehicle. The exact guarantee is dependant on each dealership, so make sure to check first.
Once the vehicle is in your possession, you will no doubt be overjoyed with your new set of wheels. But don’t just look at it through rose-tinted glasses. Make sure to thoroughly inspect the vehicle for any defects. All reputable dealers will point these out in their virtual showroom but its important that you do your own homework too. The RAC recommends a comprehensive 10-point check that includes tyres, dents & scratches, panel gaps, fluid levels, under the oil cap, electrics, glass, upholstery, spare wheel & accessories, and wear-&-tear.
If you are not entirely satisfied you should be able to return the vehicle within the agreed upon timeframe and start the process over again. If the car passes all its tests, enjoy your new ride!