How To Get A Cheap Used Car

Here are some tips that could help you save money when you buy your next used car.

Over the last ten years I have spent a small fortune on cars. As soon as I have bought one I find myself thinking about what’s next.

And the good news is that my next motor could be pretty cheap. That’s because used car prices have tumbled in recent months – thanks to a combination of the credit crunch and record fuel prices. And while fuel has dropped from the high of 120p per litre in July to around the 85p mark, car prices have not rebounded. So if you are looking to change car, now is a great time to buy second hand.

So here are three tips to help you get a good used car deal.

1) Un-cool is cool, but don’t go ugly early

If a car was un-cool originally, by the time it is resold the price will have plummeted. These are the ones to get if you are not so bothered about image, and simply want a decent car.

In fact, you can get a decent un-cool car for £3k or £4k. And you are not looking at something that old either. In a quick search of cars priced at less than £4k on Auto Trader, I found more than 10,000 that have less than 40,000 miles on the clock and are less than 5 years old. They won’t all be good cars, but a good proportion will be.

Be careful though. When you’re buying a car that is less than cool, don’t buy it when it is new or nearly new. Do this and you will lose out. It doesn’t matter how good the deal looks – the price will still have a long way to drop one or two years down the line.

2) Buy cheap, buy twice.

Don’t buy a car on price alone. It’s easy to look at the small ads and go for the lowest cost option. It may be a very decent car, but make sure you check these vital points first:

A) History: Is it too good to be true? Make sure the card hasn’t been crashed or stolen and that the mileage is genuine. Cartextcheck.co.uk will do a basic check via your mobile for £3; I have always used HPicheck.com. This excellent service costs £20.

B) Next service date: Check when the last service was and when the next one is needed. The cost will depend on the car and which service it is. Look the model up on parkers.co.uk to find out the service intervals. A quick call to the dealer will let you know the approximate cost of a service. If the car is getting close to 60,000 miles, ask when the cam belt needs changing as this can often be an expensive job.

C) Tyres : The cheapest set of tyres for a small car will set you back at least £100, for a medium saloon with ‘branded’ tyres you are looking at £250+, so if the tyres are not great, take this into account when you negotiate the purchase price.

D) MOT – If a car has a short MOT, you may get caught out if it needs work. Add to that the £40+ for the MOT and you could be looking a quite a bill.

E) Tax – 12 months tax on a mid-sized saloon will cost around £200, down to £0 for the very smallest ‘green’ cars. If there’s no tax paid on the car, take this into account and drive down the purchase price.

On top of these points, make sure you add your time into the equation. If you have to take a day out to get tyres, tax and an MOT , it will also cost you a day of holiday, or valuable weekend time.

3) Keep an eye on running costs

So you have got a real bargain. The car has been serviced, has decent tyres and so on. But before you commit, make sure it won’t hammer you on the road. Check out:

A) Future tax banding – Car Tax will increase very slightly from April 2009 for an average vehicle, and then by around £20-£25 from April 2010. Parkers.co.uk has tax prices by model. If you go for something really polluting, you could be looking at £455 per year!

B) Fuel economy – A massive proportion of any running cost. The price of fuel has come down, and it looks like it will stay down for a while, but 85p per litre is still not cheap. Make sure you know the miles per gallon, how many miles you will do annually and budget accordingly.

C) Insurance – Get a quote before you buy, and make sure you don’t take the first quote. Our online car insurance search engine will take about 5 minutes to search up to 400 policies; the saving could be the most you will earn in 5 minutes.

In part two I will be looking at where you can shop around, whether you should buy petrol or diesel, and how being clever with your financing could save you hundreds.

I’m also going to put my money where my mouth is. My Porsche is up for sale and I’m going to get a replacement for less than £5k including insurance, finance and maintenance. I’ll let you know how I get on. Until then drive carefully.

More: How to get a cheap used car, part two