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Guide to Buying a Used Car on Finance in 2018


Updated
14 Jun 2018

BMW Used Car

Purchasing a used car is ideal for people who like to snap up a bargain, and finance can be used to help purchase a vehicle in a similar way to new models. However, there are several points to look out for when purchasing a used car from a car dealership or private seller, in order to protect yourself from any extra hassle and unexpected costs down the line.

Key considerations when purchasing a used car

Our comprehensive guide to buying a used car outlines the vital points you should consider, including any relevant vehicle checks to carry out and the documents to ask for from the seller.

1. Have a vehicle history check carried out

We cannot stress enough the importance of carrying out a vehicle history check on any used car you intend to purchase. This will allow you to see if there are any outstanding issues with the car, including whether it is on record as stolen, has been written-off, or if there is any car finance left on the car.

To carry out the check, you must know the registration number, model, make, MOT test number and V5C vehicle registration certificate. Many companies can provide vehicle history check services at different price ranges, however, the cheapest ones may not give you all the essential information needed.

For a relatively minor fee of £20, you can undergo one, single comprehensive HPI check to protect yourself from receiving any nasty surprises later on. For instance, if a car is found to be stolen, even if the person who has bought it was unaware, it will still be taken off them for investigation.

Purchasing a car which has outstanding finance to pay is also a nightmare, as you may not own the car even once you’ve paid for it and you may also become liable for the former owner’s unsettled debt.

2. Do your research

We would always recommend carrying out thorough research to determine the proper market value of the car you want to purchase, so as to avoid overcharging. You can do this by looking at price guides, asking around and comparing the price to other used cars of a similar age, make and model.

Some car dealers or private sellers may not always be completely honest with you about the state of a car they are trying to sell, so it’s important to carry out a comprehensive check of the vehicle before putting any cash down on it, which leads us on to the following few points.

3. Comprehensive car checks

There are many ways you can check the physical attributes of the vehicle you intend to purchase and knowing what to look out for could save yourself a lot of time and money in the long run. Always arrange car viewing on a dry day so you can get a really good look at the car in broad daylight, making it more difficult to disguise any marks or dents.

Don’t be afraid to examine every aspect of the vehicle, such as underneath the car bonnet and under the car for possible signs of accidents or rust. A savvy, smart customer is one who checks the car thoroughly, including:


  • • Examining if the locks are the same throughout. Different locks can be a sign of the car having been broken into.

  • • Check that the windows, doors and sunroof shut properly as if they don’t the car could have been forcibly broken into.

  • • Make sure the mileage on the car matches its age and appearance. The average mileage is around 10,000 per year. If it appears to be too low, it could have been tampered with; a technique referred to as ‘clocking’, which involves winding back the miles, with the aim of increasing its market value.

  • • Look for signs of a ‘cut and shut’ which is whether the pieces from several vehicles have been joined together, sometimes illegally. You can examine the car by pulling up the carpets and looking for any hidden welding, whilst seeing if there is any shoddy paintwork, like colouring which does not really match.

  • • Check the tread depth, inflation and any damage to the tyres, making sure the wheels are properly aligned.

  • • Check oil levels are correct by lifting out the dipstick.

  • • Check that the radio, AC and other essential features are in correct working order.

  • • Turn the lights on and off.

Car Tyre

 4. Grill the seller

When you go to check out a vehicle, you are also there to check the legitimacy of the seller too. We recommend going with a set of questions on-hand, showing the seller that you are serious and know what you are talking about.

Request to see the MOT certificates and service history, whilst asking questions about the vehicle and all of its features. If the seller does not seem to know anything about the vehicle, this could be a clear indication that it has been stolen.

5. Check the V5C

It is also extremely important to see the up-to-date V5C registration document, also referred to as the vehicle log book, which details all the previous owners of the car, as well as the current owner. The V5C is a vital piece of paperwork which comes with a car and it details all the important information about the vehicle, which is also registered within the DVLA’s database.

When buying a used car privately, be sure to thoroughly check the document in several ways:

  • • Hold it up to the light to ensure the DVL watermark is present. If it does not show, the document might be forged.

  • • The serial number should not be between BG8229501 to BG9999030 or BI2305501 to BI2800000. The V5C could be stolen if it has those serial numbers. In which case, call the police.

  • • The person selling the car should be the person listed under ‘registered keeper’.

  • • You should be viewing the car at the addressed listed on the V5C.

  • • The colour should be red, as of 2010. There should be no valid blue V5C’s in current circulation.

Never, ever purchase a car from a seller who can’t or won’t show you a valid, up-to-date V5C!

6. Check the VIN

The Vehicle Identification Number (VIN) of the car is found in several places, including the bottom of the windscreen, beneath the bonnet and under the carpet on the driver’s side, stamped into the framework. This number must match the VIN that is written in the V5C registration document.

7. Take it for a spin 

Provided your insurance allows you to drive another person’s car with permission (Driving Other Cars, or DOC cover), there is no harm in asking the seller to take the vehicle for a test drive. This will allow you to gauge whether there is anything wrong with it, such as the steering, gears, clutch and brakes not working well. You should also be on the lookout for any strange sounds coming from the vehicle.

8. Essential paperwork and parts 

When buying any car, new or used, it is important to ensure that you have all the right documents and car parts before splashing any cash. These include:

  • • V5C registration, or vehicle logbook

  • • Servicing booklet

  • • Car manuals

  • • Spare tyres and tools

  • • Car keys, ideally with a spare set

  • • Sales contract

9. Used car finance options

Once you are satisfied that the second-hand car is in good condition, has all the right documentation and is coming from a legitimate seller, then you can determine how you are going to purchase it. If you do not want to make an outright purchase, there are several different finance options you can use to help fund the purchase of a used car. This helps spread the cost out over fixed monthly payments, and many finance providers also lend to people with no credit or poor credit.

The two most common finance options are Hire Purchase Agreements and Personal Contract Purchase, and many dealers will be open to offering these for both new and used vehicles. The terms are a little different for each, but you will have to pay an initial deposit and then a fixed set of monthly instalments with both types.

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