First-Time Car Buyers: How to Avoid Common Mistakes
15th January 2024
Getting your first car is an important milestone in your life. It might be one of your first big investments so it’s important to be well-informed.
To assist you in making the right choice, we've created this guide that compiles a few tips for buying your first car:
Common mistakes to avoid
Not researching before going to the car dealership
Before you start car shopping, it's a good idea to do some research. Figure out what type of car you want and what features are important to you. Look into car brands, models, and prices to get a rough idea of what to expect when you go to the dealership.
You can also explore the problems, recalls, and safety issues of various models. Reading online reviews can help you understand how different car models feel and handle the road.
Skipping the test drive
Although test-driving multiple cars takes time, it's very important to do so. During the, the car you were eyeing up might not feel like what you were expecting it to be. It’s good to continue exploring other options if this is the case.
Choosing one model and sticking to it
Putting all your hopes on just one car model is one of the car-buying mistakes you should avoid.
It's okay to have preferences, but only focusing on one model may cause you to overlook other great deals with similar specifications. Instead, find the features you like in that model and look for dealers who have similar cars.
Skipping important considerations
For a new car
When buying a new car, you're legally protected and have a warranty in case anything goes wrong. But it's best to check the car before driving it home to avoid problems later. In case the car is delivered, many dealers allow no-quibble returns if you're not satisfied.
For a used car purchased from a dealer
In case you’re buying a used car, the considerations will differ. Here are a few things to think about:
- Used car dealers often have their cars independently checked and may follow trade association codes for safety.
- By law, dealers must sell cars that are of good quality, fit for purpose, legal to drive and match their description in the advert.
- Dealers are not responsible for damage due to accident, misuse or wear and tear.
For a used car purchased from a private seller
If buying from a private seller, and something goes wrong, there are not many options for recourse. So, consider the following:
- Check all the paperwork. Be careful if they can't give you the correct documents. The car might have a different name on the registration, and there could be errors on the papers. Also, the colour and engine number might not match. Also, make sure it has a current MOT.
- Examine the mileage and compare it with MOT test certificates and service records. Old cars can have low mileage.
- When you're inspecting a car, make sure to check the paint for any inconsistencies. Also, be on the lookout for any abnormal welding, rust, or damage in the trunk and under the hood.
- Verify the tread on the tyres and the presence of a spare tyre, jack, and toolkit.
- Ensure seatbelts work, check for dashboard fault lights, and inspect washers, wipers, lights, locks, windows, and other internal controls.
- Look for rust under the footwell mats of the car.
Not getting a mechanic’s assessment
It's challenging to assess the condition of a used car. That's why it's always wise to have a mechanic inspect the car before deciding. They can provide valuable insights into whether the investment is worth it.
Not considering the modern safety features
Modern cars come with lots of safety features, but it can be confusing to know which ones really matter. Equipment like anti-lock brakes (ABS), electronic stability control (ESC), and head-protecting side airbags are important and worth the extra cost.
Instead of trusting the salespeople at the dealership blindly, do your research to find the safety features that will best protect you and your family.
Mistakes to avoid while budgeting/purchasing a car
Forgetting to account for running costs
A car is not just a one-off investment. Don't overlook the ongoing costs, including insurance, fuel, road tax, and maintenance, as they can accumulate over time. You can use a calculator to get an idea of a car's overall running costs.
Going for a “good deal” rather than a car
Nobody wants to overspend on a vehicle. But remember, if a deal seems too good to be true, it usually is. Deciding solely based on price can lead to additional expenses later on.
Be cautious with private sellers who might offer vehicles at a low price as these often need additional repairs.
Not negotiating a reduction from the listed price
Using the sticker price as your negotiation starting point might not be the best strategy.
Even if a salesperson offers a deal of £500 below the sticker price, it doesn't necessarily mean you're getting a great deal. Unless the car is in high demand and short supply, you can often negotiate an even lower price by starting from what the dealer paid for the vehicle.
Knowing the dealer's actual cost helps you understand the profit margin and allows you to set a reasonable target price for negotiations. You can calculate the dealer's cost by subtracting behind-the-scenes incentives, like rebates and holdbacks, from the dealer invoice price.
Focusing only on how much the monthly payment is when negotiating a deal
Salespeople often emphasise the monthly payment amount during negotiations. They might ask, "How much were you thinking of paying each month?" early in the conversation.
However, it's crucial not to fall for this tactic. Focusing on the monthly payment allows the salesperson to bundle the new vehicle price, trade-in value, and financing or leasing terms together, potentially leading to overpayment. Instead, insist on negotiating one aspect at a time.
First, settle on the vehicle's price, then discuss trade-in, financing, or leasing separately as needed. Also, don’t mention your desire to lease until after agreeing on the vehicle's price.
Not researching the value of your current car
Before you buy a new car, it's smart to know what your current one is worth. This helps you make the most of potential savings and trade-in options. Research both retail and wholesale values for used cars to stay well-informed.
Whether you sell it yourself or trade it in, understanding your car's value and sticking to your price during negotiations ensures the best deal. Selling privately can mean more money, but it comes with extra effort. The key is to know your car's true value and make choices that align with your preferences.
Delaying thinking about financing until you're at the dealership
If you haven't researched financing terms, you're at risk of being influenced by the dealership and potentially not getting the best deal.
Dealership terms could be higher than other options, so it is important to shop around
It's crucial to compare financing terms at different places to get an idea of what‘s available before going to the dealership. Look into interest rates at banks and online financial sites to find the best deal. If the dealer provides better terms than elsewhere, you can choose that deal.
Considering a car loan
You can think about getting a car loan if you don’t have enough savings. Finio Loans may be able to help you finance your new car.
To sum up
Buying your first car is a significant and memorable experience, but it's crucial to go through the process wisely to avoid car-buying mistakes. From research and test-driving to budgeting and financing, being informed with these tips for buying your first car might help you make a sound decision and enjoy your new vehicle with confidence.