Everything you need to look for when purchasing your vehicle

Buying your first car can be exciting and daunting. After all, a car is a big purchase, so it’s important to know that you’re getting exactly what you want – for the price that’s right for your budget.

That’s why we’ve put together a comprehensive buyer’s guide to give you all the information you need to help you find the perfect first car.

First things first… make a budget

The first thing to remember is that the cost of a car is more than the price you see online or in a showroom. You also have to consider:

• Fuel costs
• Annual service
• Annual MOT (if the car is three years old or more)
• Insurance
• Road tax

Put it this way – in 2020, the average UK car owner pays around £3100 a year for their vehicle and £1175 of that is the purchase price. So make sure you factor in those extra running costs.

How to work out your finance… PCP, PCH, HP or cash?

Unless you’ve been saving for your first car for years and plan to buy it outright in cash, chances are you’ll be opting for monthly payments through finance. There are three main types of car finance you need to consider, all with very similar initials – personal contract purchase (PCP), personal contract hire (PCH) and hire purchase (HP). Each one has its pros and cons. You can check out our car finance guide for more details.

Choosing which one is best for you will depend on a few decisions only you can make. Do you want to own your car at the end of the period? Do you want to upgrade to the latest model at the end of the finance period? And what is your monthly budget? These are just a few of the things you need to consider when choosing how to finance your new car. If you’re buying a car on finance, think about your other monthly outgoings and consider the length of the contract term. As a rule of thumb, your total outgoings for your car shouldn’t exceed 36% of your gross income.

Decide where to buy your car

Whether you buy your car from a franchised dealership, car auction or private seller, there are a few things you’ll need to know first.

Private sellers

Private sellers are potentially cheaper than dealerships, but the vehicle is unlikely to have been professionally inspected before you buy and your buyer’s rights are also reduced if you decide to go ahead with it.

Auctions

While it’s possible to grab a brilliant bargain at auction, there’s no opportunity to test-drive a vehicle and you’ll have to do your research quickly to find out the retail price. Also, it can be easy to get carried away when you’re bidding!

Established dealerships

If you’re a first-time buyer, it makes sense to go to a reputable mainstream retailer. It means that the car you choose has undergone a thorough inspection before sale and they’ll have all the appropriate paperwork and service history in place.

You can browse a range of cars in your budget online and some sites allow you to tailor your monthly payments to suit you. Or if you want to go to a showroom and talk to a sales consultant, they should be able to assess your needs and find you something within budget – but please don’t feel pressured to buy until you’ve made the choice that’s right for you.

You should always be comfortable with your choice, so even if you think that you’ve found a car you want, don’t make an impulse buy. Give yourself some time to think and discuss the decision with someone you trust.

What to look out for when buying your car: A checklist

You might already have a favourite model in mind, but it’s worth checking whether it’s really right for you. Is there enough room for you and your passengers? Is it expensive to run? Is it safe enough? To help you cut through the noise, here are some tips.

✔ Do your research

To get a good overview of a car’s reputation and reliability, as well as safety ratings and depreciation (that’s how much value the car might lose over time), go to an impartial website like honestjohn.co.uk. This is particularly helpful when you’re buying a used car, as it gives you a comprehensive view of older models that might not be featured on some sites. Things to look out for are: safety ratings, recalls, maintenance costs and mechanical faults.

✔ Do the mileage maths

Of course, when you’re buying a used car, low mileage and low cost is the ideal combination, but sometimes that might blow your budget. Instead, compare the mileage with your car research. A well-maintained model with a great rep for reliability that has more miles on the clock is going to be better than a car with a lower mileage and a few known issues. Remember, if you’re buying from a private seller, be wary of any cars with suspiciously low mileage for their age. It’s still possible to reset a digital odometer.

✔ Check its overall condition

We’re not asking you to become a mechanic here (unless you are one already!) but there are a few things to look for when you buy a used car.

✔ Bumps and dents

Check around the bodywork for any bumps or scratches on the paintwork. Don’t let minor scuffs put you off too much, though. Small blemishes can be easily removed at a repair centre and are cheaper to fix than a mechanical issue.

✔ Rust and corrosion

Steer clear of severe rust damage. Even if it looks like repair work has been done, once corrosion has started it is difficult to stop. Any uneven paintwork on the body panels could be a sign of previous repairs.

✔ Doors and tyres

Make sure that the doors, windows, bonnet and boot open properly and that the tyres have enough tread. (If they have less than 1.6 millimetres of depth remaining, this is unsafe and illegal.)

✔ Under the bonnet

Now pop the bonnet and check for any obvious mechanical issues. We’re talking leaks, burnt oil or antifreeze smells, signs of poor repair work or any modifications. Engine or radiator leaks can be a sign of a serious – and potentially expensive – problem. Look underneath the car, too, to make sure everything is nice and dry. It’s also worth investigating that the electrics are all working, including the windscreen wipers, washers, radio/touchscreen panel, windows and power mirrors.

✔ Test-drive it

When you’re buying new or used, it’s worthwhile taking a test drive to get a feel for the vehicle. This will let you know how the car handles, if it’s comfortable, and most importantly, it could flag up any obvious mechanical fault.

✔ Warm up the engine

Often, problems don’t become evident until a vehicle is properly warmed up. Make sure you drive the car for a good enough amount of time to get a real feel for it. If you’re test-driving a car from a dealer, you should be allocated around 20–30 minutes which will be plenty of time to warm the engine up fully.

✔ Take a route that suits you

It’s important to drive the car as you normally would – for example, there’s a big difference between a short commute and the demands of rural driving. So make sure your chosen car fits into your lifestyle.

✔ Drive at higher speeds

If possible, take the car on a motorway during your test drive. Lots of issues such as vibrations, alignment issues and noisy wheel bearings are only evident at higher speeds.

✔ How does it feel to drive?

Pay plenty of attention to the steering, making sure that the car doesn’t pull to one side and doesn’t vibrate. Also, check that the gear changes are smooth. If not, there could be a problem with the gearbox or the clutch.

✔ Get all the right documentation

The V5C, sometimes known as the vehicle logbook, is the most important document when buying a car. You should make sure that all the details on this form match those of the car, including the registration, Vehicle Identification Number (found where the dashboard meets the windscreen), and that the name of the registered keeper is the same as that of the person you are buying from.

You should also ask for a full service history. If this isn’t available, you can use online tools like the RAC’s Vehicle History Check to find out details about the vehicle’s past.

It is also important to get a receipt as proof of purchase, as even the V5C only states the registered keeper and is not proof of ownership.

I’ve bought my car! What’s next?

Insurance

You’ve found your perfect car, you’ve got that new car feeling, and you can’t wait to get on the road. But first, you’ll need to take out car insurance.

There are a number of different insurance policy types available, each varying in cost, but insurance is a legal requirement that every car owner must have.

Like many responsibilities of car ownership, insurance must be paid for every year. There are three main types of insurance you can buy, and it’s important to know what’s covered with each one.

Third-party

This is the insurance option with the lowest level of cover. It only covers the cost of damage to third-party vehicles or property – not to your car. • Third-party fire and theft This offers the same level of cover as ordinary third-party insurance, but you’ll also be covered if there’s any damage to your car as a result of fire or theft.

Fully comprehensive

• This will cover you for: * Loss of or damage to personal effects in the car
• Accidental damage to your car
• Damage to other people’s property
• Fire damage and theft
• Accidents caused by your passengers or a driver named on the policy

However, your level of cover may drop to third-party when driving another vehicle.

Telematics

Telematics (or black box insurance) is particularly good for young drivers whose insurance costs can be higher because of their age and inexperience on the road. A device is fitted to your car to monitor your driving – and if your driving is safe, your costs could be lowered. Basically, you’re rewarded for better driving with lower premiums.

Whichever option you go for, remember to check your policy terms and conditions, as the details will be different for each insurance company.

Looking after your car: Owner’s responsibility

Everything you need to keep a vehicle on the road is called ‘Owner’s responsibility.’ This means the responsibility of running the car falls to the person whose name appears on the vehicle licence. Here are just a few important obligations you’ll need to fulfil as a vehicle owner:

Servicing

A car’s servicing requirements will vary, depending on the manufacturer’s recommendations, its age and the number of miles it has travelled. A new car may need a service after its first two years on the road or after its first 10,000 miles, whichever comes first. After its first service, the car must continue to be serviced every year.

MOT

An MOT is carried out annually, and tests for safety, emissions and other important aspects that could mean it’s not safe to be driven. The MOT is a legal requirement for a car that is three years old or older and is an annual requirement after this time.

Do I need a service and MOT plan?

Keeping your car well maintained can decrease the risk of it breaking down in the future. You can avoid larger repair bills by keeping your car regularly serviced. In basic terms a service plan is a plan, paid for up front, that will pay for the future services and/or MOT tests for your car.

A service plan bought when you buy your car will cover your services and MOT tests for the length of the plan usually two, three or four years. This means you don’t have to worry about the added cost at the time of the service, or if service costs increase with inflation.

Road tax (otherwise known as vehicle excise duty, or VED for short)

No matter the age of your car, vehicle excise duty/road tax is a legal requirement that must be paid for every six or twelve months. However, if a car is not in use and stored off a public road then the owner of the vehicle does not have to pay road tax – instead they should have a Statutory Off-road Notification (SORN). Some new cars, like hybrids, plug-in hybrids and fully electric vehicles are exempt from road tax, but you must still apply for road tax even though you’re not paying a fee.

What if I want to make modifications?

If you’re a DIY car enthusiast, a Fast and Furious fan or you just want to express yourself via the medium of go-faster stripes or eyelashes on your headlights, you need to take a few factors into account before you carry out any extra work on your car. Here’s what you need to know:

Make sure you own the car outright

If you’ve bought your car on finance it might not legally belong to you. Instead, the finance company might have ultimate ownership and changes and modifications might not be permitted.

Update your V5 document

Your vehicle’s V5 must be updated with any changes that are made to the vehicle, to ensure that anyone who buys the car in the future knows all they need to know about the car and any changes that have been made.

Tell your insurance provider

Any changes made to a vehicle, no matter how small or insignificant you may believe them to be, must be reported to your insurance provider as this could make your insurance invalid if you were to be involved in an accident.

Are your changes legal?

Before you pimp that ride with a blue LED strip, an exhaust the size of the Channel Tunnel and tinted windows make sure these changes are legal and meet DVLA standards. And finally, remember to keep your vehicle information up to date.

Make sure that your details are kept up to date and relevant throughout your driving life. Information may include your address, name, contact details and any changes in your health. All of this information is relevant to the DVLA and the information related to your vehicle. As well as this, the driver of a vehicle is responsible for their own licence so be careful that it’s up to date and valid for the type of vehicle you’re driving.