by Gauk
Mon, Aug 29, 2016 5:34 AM

How to Find a cheap new car, the importance of planning

Finding a cheap new car is easy – as long as you know how! The key is to not jump straight into the market and be desperate to buy, instead put in the research and take a considered approach to finding a cheap new car.

Finding a cheap new car – the importance of planning

The most important step in finding a cheap new car is to make sure you prepare thoroughly before you talk with a dealer. The simplest way to do this is online, using directories such as

The drivers who typically get stung by persuasive car salesmen are those that walk into a showroom with an effective blank canvas – allowing the dealer to paint the picture of the car they want. Instead of doing this, you should know what you want beforehand and most importantly research that vehicle and know what makes a good deal and what doesn’t.

Once you have decided on the type of vehicle you want, the next thing you should look at is price. By using an online directory you can compare thousands of deals on the same model of car instantly. This should give you an overview of what the general retail price of the model is. If one dealer is offering the new car you desire at a considerably lower price than a dealer at a more convenient location, you can take the quote from dealer A and ask the second dealer to match or beat that price.

To find a cheap new car, you must think about the factors that make it cheap – i.e. what is its specification? Think about the features you must have (for example air conditioning if you live in a congested city) and the features you can live without – how important is that sports suspension or those alloy wheels, for example?

Finding a cheap new car – the key to car finance

Of course you need to consider more than just the make and model you want to find a cheap new car – you must also think about how you’re going to finance that vehicle.

There are two main options available – buying and leasing.

By buying a new car, you own it outright and make interest payments on a loan. This is the preferred method for those with flexible lifestyles, who want ownership of a car and who don’t object to initially higher monthly premiums.

Alternatively, you can lease a car – meaning you take the car for a contractual term (usually two-four years) and at the end of the term simply hand the car back to the leasing company. During the term you make monthly payments that are determined based on the value of the vehicle when your lease contract begins minus its estimated worth at the end of the term (the residual value).

This is a method preferred by those with stable lifestyles as leasing companies will give you a strict mileage limit that you must stick to or face charges. You will enjoy lower monthly payments and be able to change your car every few years. A personal contract purchase (PCP) deal, will give you the option to buy the car at the end of the lease term.

So you need to decide which method of car finance is right for you and importantly, shop around for the best deals. You can use comparison sites to compare loan rates or use a directory such as to find the cheapest leasing deals.

Before approaching any finance company, or even going through a car dealer, you should familiarise yourself with your credit rating. If you have impaired credit you are unlikely to receive the best rates so do all you can to build your credit rating before you buy or lease.

Finding a new car – tips to save money

Here are some general tips to help you secure a cheap new car:

  • Give yourself time – If you attempt to search for a cheap new car when your current vehicle is heading for the scrapheap or sold, you’re likely to rush into a poor deal. Give yourself time to be thoughtful about the car you buy and even if you are desperate to purchase, never let the dealer know!
  • Build your credit rating – If you choose to buy a car, check your credit rating with Experian or Equifax before shopping around for loan rates. If your credit rating is poor you will pay huge sums of interest, so do all you can to build your credit rating – have a fixed address/employment for six months or more; use a credit card that you pay off in full each month; pay all your bills on time.
  • Down-payments/trade-ins – You can cut a huge sum off the money you borrow if you can offer a down-payment or trade-in. If you choose the latter, research before you sell – make sure you’re getting a good price. Remember you could always sell the car privately and then put the money towards your new car.
  • Get the timing right – The time of year makes a big difference if you want a cheap new car. December is an ideal time as many dealers look to meet end-of-year targets and business is typically low as sales drop around Christmas. Also, the months preceding the introduction of new registrations are ideal as dealers look to sell off excess stock to make way for new models.
  • Think about the extras – Do you really need an extended warranty? Most manufacturer warranties last for two-three years so if you are likely to sell the car around then, why pay extra to extend the warranty? Also be careful not to be tied into an expensive insurance deal as part of the package – shop around for car insurance separately.
  • Look for incentives – Many manufacturers offer rebates on slow-moving inventory. Your dealer might not inform you of these in the hope of keeping the profit for themselves – so make sure you research thoroughly to see what’s available. Also ask if your dealer is willing to cover the cost of insurance, tax or fuel for a set period.

Finding a new car – where to go to save cash

The most important tip to save money on a new car is to shop around online. A car is likely to be the second most expensive purchase of your lifetime behind a new home – so treat it with the same respect.

published by Gauk