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Buying a second hand car – what you need to consider

If you’re thinking of getting a new car, it can often make a lot of financial sense to go for a used model – even if it’s just a year or two old.

Depreciation means that buyers pay a significant premium for brand-new vehicles. So if you’ve decided to go down the second-hand route, what do you need to know?

Is the price right?

There are millions of used cars sold in the UK every year, which makes checking prices simple. Once you know the make, model, age and mileage of the car you’re interested in, you can see what similar vehicles are being sold for through internet ads and at dealerships.

There are also a number of websites that offer valuations, but you might have to pay for a service like this. This information should give you a very good idea of whether a sale price is fair or not – and if there is any room for haggling.

Dealer vs private sale

If you buy through a used-car dealership you can generally expect to pay a little more than through a private sale: after all, the dealer has overheads such as premises, staff and marketing to cover.

But a dealer is more likely to have made checks on the condition and provenance of the vehicles on its books. And if anything goes wrong with the car immediately after purchase, you have far more chance of redress.

Last year, new laws were introduced to strengthen consumer protection when buying second-hand cars from dealers: for example, it is now possible to demand a full refund if problems arise within 30 days of purchase.

Play it safe…

If you choose to buy from a private individual, there are a number of precautions it is worth taking. Try to view the car in daylight at the address listed on the vehicle’s registration document (this helps to confirm that the seller is the legal owner).

Take a friend with you to get their view, and for safety reasons. Be suspicious if a car is being offered well below the price you’d expect to pay. The seller may be hiding mechanical problems or worse.

Finally, avoid paying by cash if possible.

…and watch out for scams

These steps can help you avoid being conned, but there are a number of scams to watch out for. Some involve phantom vehicles being sold at too-good-to-be-true prices via online ads, with sellers promising to deliver the car only after an initial deposit has been paid.

Cons like this often involve victims paying via a money-transfer service such as Western Union. But police advice is only to use such transfers to send money to someone you know.

Get the right finance deal

Paying for the car is of course a big part of the process. Using a personal loan means you know exactly how much you have to repay every month and for how long. If your credit record is in good shape, you should be able to get a low rate of interest. Find out more about Zopa’s car loans.

Using a loan means that the vehicle belongs to you as soon as you buy it. If you are considering hire purchase, on the other hand, you don’t own the car until you’ve made your final payment. Personal contract plans are another alternative, but they can be complicated. For example, at the end of the plan you may have to find a considerable sum of extra cash if you want to keep the vehicle.