The ten golden rules for buying a car

Car buying advice Car finance advice
Follow The Car Expert's Ten Golden Rules for Buying a Car

Rule 5. A car dealer will try to sell you the car THEY want you to buy, not the car YOU want

Car companies usually have a large range of models, each with several different engine, gearbox and trim choices, plus a huge range of colours and options. There can be literally millions of potential combinations for any particular type of car. That means that the chances of a dealership having the exact specification that you would like – available and in stock – are usually fairly low.

Instead, dealers will stock a selection of cars, usually in the most popular colours, with more available “from our secure storage facility” (a field somewhere) or in stock at other dealerships, or of course you can order one directly from the factory to your exact preferences and simply wait for it to arrive.

However, the dealer doesn’t want you to order a car, or make them bring one in from elsewhere. They want you to buy the car right there in front of you, because that car is costing them money every day it sits there.

A car that they don’t have doesn’t cost them anything, so it’s in their interest to convince you to take that car right there, however they can. Whether it’s sweetening the deal on their showroom car, or scaring you off ordering a car with long waiting periods and a reduced part-exchange price, or any other method, they will always try and sell you the car they have now, regardless of whether it’s what you want.

The Car Expert ten golden rules - stand up for yourself

“I know you want a blue petrol automatic, but I don’t have one in stock so I’d really rather you bought this white diesel manual right here”

Next page: That all sounds fine… but is it really?

Stuart Masson

Stuart is the Editor of The Car Expert, which he founded in 2011, and our new sister site The Van Expert. Originally from Australia, Stuart has had a passion for cars and the car industry for over thirty years. He spent a decade in automotive retail, and now works tirelessly to help car buyers by providing independent and impartial advice.

12 Comments

  1. hi stuart ,
    is it right that a balloon payment on a bmw new car purchase deal , cannot be reduced by early repayment sums . ?we were told by their salesmen that we could reduce the balloon payment by early overpayments. how much interest is included in the balloon payment,? would it typically be more than the interest accruing in our regular monthly payment on a pcp deal?

    Reply
    • Stuart Masson

      Hi Robert. Normally no, the balloon amount at the end of the term is fixed as it represents the predicted value of the car at that time. Usually overpayments will reduce the monthly payment amount, which includes the interest payable on the balloon. Some finance companies will allow you to use overpayments to shorten the term, but this is less common.

      You pay the same APR on the balloon as you do on the monthly payments. However, you are paying the interest for the whole loan amount (inc. balloon) up-front. Making overpayments will reduce the total amount of interest you pay as you are reducing the amount of debt outstanding.

  2. Hi Stuart, I’m considering taking a PCP out on a brand new Audi S3, I have a considerable deposit that I can put down, 12k to be exact which makes the monthly payments easily affordable but my concern is, that after the 3 or 4 year payment term comes to an end, the difference between the GFV and what the dealership actually values the car at at the time of trade in, the actual deposit I’ll have to put towards another PCP deal will be considerably less and the payments will be considerably more. So 12k inital deposit turns into 2k after 3 years so in effect 10k lost! Are people aware of this?

    Reply
    • Stuart Masson

      Hi Rob. Always assume that you will have no equity over and above the GMFV. If you do, then great. But never start counting equity in advance.

      It’s not so much as “£10K lost” as “£12K of cash lost now but lower monthly payments for three years”. If you put no deposit in, your monthly payments would be much higher and you would also be paying interest on all that extra money borrowed, so your Total Amount Payable would go up.

      (But you are right in that most people seem to be unaware of this; they get sucked into a PCP and then get to the end of it and realised they are screwed when they want to change for another similar car)

  3. These are all really great advice stuart! People really need to bare all of these things in mind.

    Reply
  4. I have a 2016 ford ka which i got last may, i would like to takr it back to garage, how much would i loose on a 48 months finance plan

    Reply
    • Stuart Masson

      Hi Angela. Probably about a third of the car’s value, at a very rough guess. Have a read of our article on new car depreciation for more information.

  5. Hi Stuart I recently sighted a paper at BMW for them to check my finance no handover paper and paid 500 does that mean I am legally binded to the car also the invoice price is much higher than the actual price of car is that correct?

    Reply
    • Stuart Masson

      Hi Jasmin. If you signed a form for them to “check your finance”, this was almost certainly a finance application. The finance company generally does not check your credit score or review your financial situation until they have a formal application – it’s not in their interests and it’s certainly not in yours.

      If you have signed a form and paid the dealer £500, they consider you to have bought the car.

      The invoice price may be different from the advertised price of the car, but there should be a good reason why. If it’s a used car, the advertised price won’t include road tax. Dealers will often also try to throw in an admin fee that may have been mentioned in very small print in the advertisement or on the car’s window display, plus they will almost always try to sell you extras like GAP insurance and other crap that you don’t need or want. Often they will assumptively include this in the finance quotation and hope you won’t demand they remove it later on.

  6. Thanks for the helpful advice Stuart! I’m looking into buying my first car this year- any pointers?

    Reply
  7. Hi
    I am 2 years and 2 months in to a 36mth pcp on a skoda citigo. I have kept up my payments of £124.70 per month this totals £2750 ( approx ) . I want to give up my PCP now and don’t understand if I will have to pay any more money as I have paid for more than 50% of the 3 years could I hand it back without a penalty ?
    Thanks

    Reply
    • Stuart Masson

      Hi Jayne. The 50% point refers to the Total Amount Payable, which is the total of your deposit, the monthly payments, the final payment (GMFV) and any fees and charges. It is not 50% of the term.

      For more information, have a read of our comprehensive guide to voluntarily terminating a PCP.

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