Passed your test? Buying your first car?

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OK, so you’ve just passed your practical driving test – congratulations! – and now you’re looking to take your first plunge into the car market. Spring is a good time of year to be in the market, whatever your budget. New registration plates become available from March 1 (this year it’s ‘13’ – in September it’ll be the ‘63’ plates), so if you’re flush with funds, that would allow you to announce your arrival on Britain’s roads with something of a flourish.

Chances are, though, you’re looking to spend a little less than a brand new set of wheels would set you back. Although, having said that, you’ll probably find that dealers are discounting the prices of old ‘new’ stock to clear some space for the latest arrivals. If you’re in the secondhand market, you benefit at this time of year because more people are selling their cars and trading up to a new one, meaning there should be plenty of choice and enough volume of vehicles to keep prices relatively low. Whatever your situation, here's a quick guide on what to look out for…

Affordability

As a first-time buyer, if you don’t have cash in the bank you have various options. Take out a loan, use a personal contract purchase (PCP), or a hire purchase and lease agreement. The easiest way of financing your vehicle is to take out a loan from a bank or other financial provider or use a 0% interest credit card. Head online via MoneySupermarket’s loans and credit cards channels for the best deals. This is probably the best way of purchasing a car because you'll own it outright as opposed to other options where you part own or rent.

Leasing

Buying a car through personal contract leasing means you can have a new vehicle but not actually own it. As long as you keep the monthly payments going you'll receive a new car every few years. A similar option could be the PCP mentioned above – the only difference is that at the end of the contract you have the option to buy the car. Hire purchase is another option. A deposit of usually around 10% of the car’s worth is then followed by monthly payments with interest. After the full amount is paid back the car is officially yours. If you put down a substantial deposit there is a higher chance of being offered a lower rate of interest on the monthly repayments.

Where to start

There are many different internet sites and magazines you can look at when searching for a bargain motor. However, bear in mind the cheapest isn't always the best as in the long term you may have to shell out a lot of cash to make the vehicle roadworthy. New drivers should look at a car with smaller engines. These cars will be cheaper to buy and to insure. Cars are not cheap things to run so also consider the reliability and running costs of various types of car before taking the plunge.

Where to buy

There are so many places to buy cars from: private sellers, auctions, franchised dealers or independent dealers. Never buy from the first dealer you find; check whether you can get a better price elsewhere. Always negotiate the price, you've got nothing to lose and everything gain – remember they want your money.

Check out the car

Before exchanging any money you should give the car a thorough check over. The security system fitted on the vehicle will have a huge impact on the price of your insurance and therefore should be a priority. Every car should come with a service history manual and documentation. There should also be a vehicle V5 registration document and MOT. The car's Vehicle Identification Number (VIN) should always match the V5 document, if it doesn't – walk away. If you think buying a car at an auction or going through a private seller is for you then make sure you take out an HPI check on your chosen vehicle. This will ensure you're not buying a car with outstanding finance or a vehicle registered as stolen with the police. If you buy a car with outstanding finance you will either have to pay the remaining amount or the finance provider can repossess the car. An HPI check will also find out whether a car has been cloned or if it's an insurance write-off.

Test drive

Before you set off on a test drive make sure you are insured to drive the car. Dealerships will be covered by a separate policy whereas private sellers will need to have fully comprehensive insurance and give you permission to drive the vehicle. If they only have third party cover and you are involved in an accident then the situation could get expensive – for you. When you're driving in the car, make sure you drive over some bumps and check out the suspension. Turn on the radio and other electrical appliances. Gear changes should be smooth, otherwise you could be buying a new gearbox fairly soon. Perform an emergency stop to get an idea about the state of the brake pads.

Car safety

Accident statistics are pretty damning for young and inexperienced drivers and therefore it's essential the car has as many safety features as possible. The widely respected NCAP star rating is a good gauge for a car's safety as it tests how a vehicle performs in a crash. The essential safety items to look out for are air bags, anti-lock brakes, traction control, crumple zones and head restraints.

Insurance quote before purchase

After checking the condition of a car, taking it for a test drive and bartering down the price, the last (and possibly most important) thing to do before exchanging any money is to get an insurance quote. You don't want to buy a car and then find out you're paying more than you can afford for insurance. It’s quick and easy to do online.

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