CarDrive - All About Your Car (Or BIKE...)
Welcome to CarDrive.
This section is all about your car.
We cover how to get your next car, and some of the options open to you.
Believe us there is always some company who are wanting to attract new customers and will offer discounts – the trouble is it could be a different company every year.
You will also have to insure your car – it’s a legal requirement. There are different types of cover – third party (covers others but not you), third party fire and theft (covers others and your car if it’s stolen or damaged by fire) and fully comprehensive (also covers your car, even if the accident is your fault). Oddly, comprehensive isn’t always the most expensive!
vehicles were registered for the first time in Great Britain in 2017
vehicles were licensed for use on the UK roads at the end of 2017
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Your next car
This deals with buying or running a vehicle.
When it comes to getting your next car, there are a number of alternatives, which are explained in more detail below.
There are many different ways to run or buy a vehicle; Cash, Loan, Hire Purchase, Personal Contract Hire, Personal Contract Plan.
Some people love to drive a brand new car or prefer nobody else to have driven it but remember you are paying brand new car tax as well. Some people will wait 3 years until the 50% depreciation has come out and then buy. But vehicles will continue to depreciate up to 10 to 12 years before the vehicle stops losing money.
You do own the car, but we advise you to do the numbers. Today many thousands of drivers are opting for leasing or PCH or PCP. Whereby you can lease a vehicle each month and at the end of a given time hand the vehicle back and get a new one and start all over again. There are lots of benefits and peace of mind about leasing a car.
You can take a loan or Hire Purchase and pay for your car that way but again remember the longer the loan term and the depreciation on the car could leave you losing out.
Often Leasing, PCP, PCH is not good if you’re doing high mileage and there are penalties for going over the prescribed mileage.
Always check the interest rates and read the fine print. We strongly recommend you never buy impulsively you might have to wait 3 to 5 years to regret it. Don’t be tempted to sign on the day when buying a vehicle. Salespeople want to hook you in get you to sign whilst emotions are running high. Take your time, at least over night to check the interest rate and the details on the agreement.
Also be on your guard for all the glitzy extras such as warranties, Super water resistant coatings, GAP insurance. Legal cover, etc etc. Some are important to cover and some need your thought but you don’t need all of them and the salesperson and company earn very good commission from the extras. So read the details overnight and go back or call the next day.
You’ll need to pass a credit check to secure your agreement. You’ll often be able to get a better interest rate with a higher credit score. Find out more about how to improve your credit score.
Car leasing credit checks won’t assess your other outgoings to make sure you can afford the payments. This means you need to make sure the costs are within your budget. Use our Budget Planner to help.
Although leasing has its advantages, it has restrictions too – it’s not your car! Click the button to see these.
This way the car is yours immediately. You will spend less time in the dealership buying it, although it may not be the best deal (if the dealer offers cheap finance).
Taking out a loan to buy the car
If you want to borrow money to buy a car, your bank or building society is likely to be cheaper. You should make sure you can afford the repayments (BudgetDrive) and you get the best rates (YouDriveHealth.com/DebtDrive).
Personal Contract Hire (PCH)
If you’re looking to hire a car long term and don’t want to buy it, the cheapest option is likely to be using PCH.
Personal Contract Plan (PCP)
PCP is similar in many ways, but lets you purchase the car at the end of the agreement.
Is it likely you’ll be handing the car back?
If so, leasing a car through personal contract hire (PCH) might work out cheaper for you. Be careful though. If you can’t afford the PCH monthly payments and have to cancel the agreement, you may have to pay off the leasing costs in full, which would end up costing you more.
Traditional Hire Purchase
For many years people who could not afford to buy the car outright would take out a car loan or hire purchase agreement.
Selling your car
There are many options for selling your car. You need to decide on how is best for you.
Insuring your car
The first thing is getting you the best deal to meet your needs and that is important; it is also worth considering maintaining the search for future by having specialists search for the best suitable product every year;
Let’s look at some basic points; It’s not just about price!!! Why – often you’re not comparing apples with apples. Comparison websites do a good job, but not every company is on there, and the small print hides a lot of differences – and that’s just the initial price! There are other things you can do to affect the price – for example having telematics (a monitor for you driving and speed) can reduce the cost, especially for young drivers.
When we have a crash or accident we might then realise the problems with what we paid for. Smaller companies often have their own claims team and get on the case quickly and talk to you. As opposed to larger companies who are so massive they outsource even making the tea. You will struggle to find the person to talk to because they are so big.
Vehicle insurance is fickle in that each company changes its rates each year based upon risk, vehicle costs, claims experience etc. So because they are brilliant this year does not mean they are brilliant others.
Some companies are really good with paperwork and keep it English and keep the Terms and conditions down to a minimum whilst others do the complete opposite, I think it’s fair to say that I have never seen the small print benefit a customer. However, small print usually means restrictions. Having restrictions usually means they do it cheaper.
So I know we switch every year without reading the small print but it’s important to make sure we understand these otherwise if a claim happens the first thing most insurers do is reach for the rule book. So read your document. If there is a £100 difference between prices there is usually something missing, so take the time out to read the excesses and exclusions.
But do switch every year or two because it will save you money. Our switching service takes the hassle out of finding the best deals every year.
What you need to kniow about car finance
The top ten ways of buying a car are explained briefly in this video.
The Money Advice Service explain car finance
Money Advice service offer advice on taking out a personal loan to buy a car
Direct Line offer car cover and explain the benefits of telematics (‘black box’) insurance for young drivers
Arnold Clark have a good summary including the pros and cons of both buying or leasing a car