FAQ Friday: What should I know before I buy a car this year?
January 27, 2023
On the last Friday of every month, we answer some of the most frequently asked questions (FAQ) from the hundreds of consumers who contact us. For this FAQ Friday, we explain your consumer rights if you’re thinking of buying a new, or used, car in 2023.
I want to buy a new car but I was told that the price of the car could go up, even after I pay my deposit. Is that the case?
Buying a new car can be an exciting process, but over the last few years a lot has changed due to supply problems and other issues in the car industry. As a result, many consumers have experienced long wait times and price increases.
If you buy a car from a dealer or garage, you are protected under consumer law. For example, they must give you certain information before you buy. This includes the total price of the car, including taxes. Where the price cannot reasonably be calculated in advance, the dealer must show how any price changes will be calculated. Information on any additional charges – such as delivery fees – must be set out in the terms and conditions and agreed with you before you buy.
Before paying for a new car, ask the dealer or garage:
- if the price of the car could go up before you get it, and if so on what basis? It is important to understand how the dealer will calculate and apply any increase in costs. This will help you make a fully informed choice.
- if you can cancel your order and get your deposit back if the price of the car increases beyond what you are able or willing to pay.
We would strongly suggest that you get the answers in writing from the dealer.
I’m thinking of buying a used car, what should I be aware of?
Before buying a used car, you should:
- know who you’re buying from; is it a dealer or a private seller?
- know how much you can afford to spend
- check the car before you buy
- and be sure of your rights after you buy
If you’re buying from a dealer, you have rights as a consumer. This includes a new right to cancel for a full refund if a fault appears in the first 30 days after you buy the car. You also have the usual redress options after that, which include a repair, replacement or a price reduction.
But if you’re buying from a private seller, you do not have consumer rights. If you discover a problem after buying from a private seller, your only option could be taking a civil case through the courts. So be careful and always have the car checked by an independent mechanic before you buy.
Get the full history of the car before you buy. There are companies that do this for a small fee. This will show you if the car was ever crashed, its true mileage, the number of previous owners, and if there is any outstanding finance on it.
What are the different ways I can pay for a car?
There are a number of different ways to pay for a car, including:
Cash or savings: Saving up the money is the cheapest way to pay for your car as you will not pay any interest.
Hire Purchase (HP): HP is a type of credit, often available from car dealers. Under a HP agreement, you hire the car, pay an agreed amount usually in monthly repayments, and become the legal owner of the car at the end of the agreement once you have paid the final instalment.
Personal Contract Plan (PCP): PCPs are like HP agreements. They are quite complex compared to other types of finance so it’s important to fully understand what you are signing up to. With a PCP, you don’t own the car until you pay the final lump sum.
Personal loan: If you use a personal loan to pay for your car, you will own it from the day you buy it. This is different to a PCP or HP, where you do not own the car until you make the final payment.
You should also bear in mind extra costs, such as car insurance, motor tax and fuel costs, when you set your budget. Learn more about buying cars, including questions you should ask before you buy and what car checks you should carry out.
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