Your Comprehensive Guide to Buying a Used Car

Buying a used car can be confusing, intimidating and overwhelming. Even knowing where to start can sometimes be a challenge.

In this comprehensive guide, Tempcover will guide you all the way through the process and benefits of buying a used car – from choosing where to buy from to ensuring you have the right legal documentation to drive the vehicle.

One of the first considerations when it comes to buying a second-hand car is deciding on what kind of vehicle you need. Are you looking for a bigger family car or a cheap and cheerful second car that will be used as a runaround?

Once you have decided on this, you can start researching the cars available from dealerships, private sellers, auctions and online. Here’s what to expect from each seller:

What should I check for when buying a used car?

Look out for any car warning lights and create a checklist before buying a second-hand car. This could include:

• Mileage – Does this align with the car’s age and usage? Watch out for clocking (also known as odometer fraud), a practice where the odometer has been tampered to make it appear that the car has travelled fewer miles than it actually has. You’ll want to check this car’s mileage is genuine by looking at MOT certificates and service documents, contacting previous owners or arranging a history check from a reputable company.
• Condition – Check the condition of the car in bright and ideally dry conditions. Keep an eye out for dents, scratched, inconsistent paintwork and panel gaps – any giveaways that the vehicle may have been involved in a major accident.
• Repairs – Ask the seller if there are any outstanding repairs that need to be carried out. Any signs of welding could indicate the vehicle has undergone some structural repairs.
• Oil – Open the bonnet and check the oil levels. Be aware of sludge and signs of engine wear.
• Engine – Listen out for unusual noises and look out for leaks when you start the engine.
• Radio – Make sure all the electronics are working.
• Lights – Check every light – both external and internal – is working.
• Tyres – Check the tyres on the car you’re interested in. Do they all match and is the tread depth above the legal limit of 1.66mm?

You can also use an approved vehicle history checker to uncover any potentially hidden problems.

Important questions to ask when buying a used car

You’ll want to know as much as possible before spending any of your money on a used car. Below are just some of the questions you could ask when buying a new car.

• What is the car’s service history?

Is there a long-running problem the current owner hasn’t got around to fixing or is unaware of? Maybe there’s something that might cause you issues further down the line? You could ask them to resolve this before making your offer. If you’re still concerned, you can get vehicle information from the DVLA at gov.uk.

• Has the car been involved in any accidents?

If a car has been involved in an accident, there’s a chance it may have some long-term damage. Check with the seller if there are any accidents so you can examine accordingly.

• Are there any outstanding finance agreements?

The finance company is the legal owner of a car until finance is paid off. Buying a car, even unwittingly, with outstanding finance could end up with the car being seized. If you accidentally buy a car with outstanding finance, flag it with the finance company, discuss with the seller (if you feel comfortable to do so) and potentially seek legal advice. One potential sign that a car is still under finance is it’s being sold for way below face value.

• Can I see the V5C log book?

When you go to see the vehicle, ask the seller to see the V5C vehicle registration certificate (log book).

1. Make sure the log book has a DVL watermark and the serial number is not between BG8229501 to BG9999030, or BI2305501 to BI2800000. If it is, the V5C might be stolen. Contact the police as soon as you feel safe enough to do so.
2. Ensure the details in the log book match the details you’ve been given.
3. Check the Vehicle Identification Number and engine number match the details in the log book.

• What is the Vehicle Identification Number (VIN)?

A Vehicle Identification Number (VIN) is similar to a fingerprint. It’s a code composed of 17 characters that uniquely identifies the vehicle. If you’re thinking of buying the car, it’s worth making a note of this to check it is legitimate and in case you have any issues with the car if you do buy it.

• Does the car have a valid MOT?

Does the MOT status and history match the details you’ve been given. This will show you any mileage discrepancies or advisories that have not yet been actioned. You can check the MOT history of a vehicle at gov.uk.

To find out more, read our Questions to Ask When Buying a Used Car blog post.

Do I need insurance when buying a used car?

Yes, you need insurance to legally drive a car on any public road in the UK. One of the most suitable options for a test drive, especially if buying privately (most dealers will have their own insurance) is temporary car insurance.

You’ll also need insurance when you collect the car. You can either cancel your existing policy and start up a new one, but bear in mind this may invoke extra admin fees, transfer your existing policy over to the vehicle you’re buying or get temporary drive away insurance.

This gives you the chance to collect the car and bring it home for any time ranging from one hour to 28 days and then spend some time researching and finding the right annual, 12-month premium.

Can I test drive a used car for sale?

A test drive gives you the chance to check a used car’s condition and its suitability. As well as ensuring everything is working as you expect, a test drive gives you the chance to get a feel for the car and make sure you’re comfortable driving it.

Before taking a test drive, you should do the following:

• Arrange test drive insurance – Getting test drive insurance is quick and easy. You can get a quote from Tempcover in under 2 minutes and arrange it for a time that suits both you and the seller. You can find out more in our test driving guide.
• After setting up the correct cover and examining the car, it’s time to get your hands behind the wheel and take it out for a spin. Start the engine, check the temperature gauge and make sure you feel confident in the clutch, brakes and gears.
• If there are any unusual noises or anything else that raises concern, you now have the chance to ask the seller about it and see if they’d be willing to solve any issues before you hand over your hard-earned cash.

What documents do I need to buy a used car?

• Logbook (V5C) – This form confirms who the registered keeper of the car is, proving their ownership. It also contains the registration and taxation history of the vehicle.
• Servicing booklet – This documentation keeps track of the car’s maintenance history. You can use this to see how reliable the vehicle is and reference it if you have any struggles after buying it.
• Manuals – Want to know what all those buttons do or need a diagram of everything under the bonnet? The car manuals will tell you everyone. Although the majority of these manuals are available online now, it’s still worth having physical copies to pinpoint any issues while you are on the road.
• Spares – Does the seller have the spare keys on them? Getting a duplicate set made can be very expensive so make sure they do if you’re willing to make a purchase. Check the spare tyre is where it should be ahead of completing a sale.
• Sales contract  – Whoever you’re buying from, make sure you keep a written, hard-copy record of your transaction. Make sure it includes the price and terms of the sale. 
• Finance package – If you’re buying privately and the car was previously on finance, make you sure all outstanding terms are settled before signing anything.

How should I pay for a used car?

Whether buying from a dealer, private seller, auction or online, it’s best practice to arrange your method of payment in advance.

There are a few different payment options for buying a second-hand car:

• Cash – This is straightforward but requires secure handling. It’s also probably not the best idea to be carrying around thousands of pounds in cash.
• Debit card – A bank transfer is an instant and traceable method, often proving cheaper than other finance options. Paying by debit card is effectively the same as paying by cash, but you won’t have to carry physical sums of money around on your person. 
• Credit card – You can also pay for the car via credit card. Credit is a high-cost form of short-term lending, which relies upon having a high credit rating and may have a high spending limit (meaning you might not be able to pay the full amount). Be aware some dealers might not accept credit cards so debit or finance may be a more convenient option. You’ll also need to maintain the repayments. If you can’t you’ll face some high-interest accrual.
• Finance agreements – This payment method is offered by dealers but often includes interest, meaning you may end up paying a little more than expected.
• Personal loans – You could take out a bank loan to pay for the car. Your bank can split the cost of the car purchase over a length of time.

Your receipt should confirm the full amount you’re paying and list any extras that have been added to your purchase e.g. extras or repairs.

What are the benefits of buying a used car?

There are quite a few benefits when it comes to buying a used car instead of a new one.

As spoken about in this article, one of the major positives is affordability. With brand new cars decreasing significantly in value the moment they leave the forecourt, there are significant savings to be found when searching the second-hand market. You’ll also often find insurance rates are lower for second-hand cars.

Cars start to lose value more slowly after their first year, so you can often pick up a bargain if you’re happy to go with slightly older models. There are also environmental benefits to buying a used car. Prolonging the life of a car helps stop it from ending in landfill and if you opt for one with fuel efficiency, that can also help lower your own carbon footprint.

If there’s a brand new version of the car you’ve had your eye on coming out and you don’t mind the aesthetics of it being from a previous edition, you could find some amazing bargains. If you are after a specific model, you may be in luck as around 7 million used cars are sold every year.

There is a lot of choice and variety when it comes to used cars. Whether you search online or in person, prepare to be astounded by the sheer breadth of models, ages and prices on offer. You may even come across a dream car you’d never even considered.

Dealers may offer special deals on ex-showroom or nearly new cars which you can take advantage of, but bear in mind they may be time-sensitive and have restrictions. You might also find a private seller in need of a quick sale. Just carefully examine the car in person and make sure you’re happy with it after a test drive if you are tempted.

When is the best time to buy a used car?

There may not be a ‘best’ time to buy a used car, especially from a private seller, but if you find one that suits your needs you can try and seal the deal quickly by having open and constructive discussions to finalise the deal. Be polite and fair while trying to haggle and research market prices for similar vehicles to negotiate a lower price.

If you’re buying from a dealer, bear in mind that they have targets to meet in order to reach their bonuses. With this in mind, their salespeople may be more willing to do deals at the end of every quarter. This means March, June, September and December could be good times to buy a used car.

Weekends and paydays can be busier times for dealers and may mean they’re less willing to negotiate while off-peak times can work in your favour. 

Only hand over your money once you are satisfied with the terms of the sale and the vehicle itself. You’ll need to arrange tax and insurance before you drive the second-hand car away from its owner, and make sure you have all the relevant paperwork.

Take your time to make the right purchase based on your needs and budget (try not to go over this) and make note of all your legal rights when buying a used car from a dealer or private seller.

Do not feel pressured to buy. It’s fine to walk away if you have any doubts. We hope you now know what to look for when buying a used car.