Car dealer finance.

Auldie_2

I am in the market for a replacement (used) car. I have a very good idea what I want, regarding model, age, price etc. I have the cash in the bank to pay for it.
My questions are:
1. Would there be any advantages buying from a dealership as opposed to private. If the price difference not much?

2. If bought from a dealership would opting for their finance at the outset give me any great leverage on the price negotiation.
(I would cancel the finance agreement once the deal etc was done and pay it in full)

3. Is doing as in Q2 asking for problems? I assume all finance agreements have a cancellation period.

Hope these questions make some sense
Thanks Edd

PNPSUKNET

1. if its a car under 3 years and hpi clear private will give you the better deal.
2. You will have documentation fees etc involved so it will cost you more, also some put early term charges on.

alcsl

Hi, i've responded below:

Auldie wrote: »

I am in the market for a replacement (used) car. I have a very good idea what I want, regarding model, age, price etc. I have the cash in the bank to pay for it.
My questions are:
1. Would there be any advantages buying from a dealership as opposed to private. If the price difference not much?
You have more protection buying from a dealership, they normally sell cars with a warranty, sometimes for 12 months. That gives you peace of mind. Buying privately it's often a case of 'sold as seen'. You do still have rights, but it's a lot messier with private sales. Buying privately can be cheaper, but there are more risks you need to be aware of and have covered off, like HPI checks, etc.

2. If bought from a dealership would opting for their finance at the outset give me any great leverage on the price negotiation.
(I would cancel the finance agreement once the deal etc was done and pay it in full)
Normally not, cancelling the agreement and paying in full may mean you still end up paying a lot of the associated interest minus an early payment discount. They may give you some discount, but only because they're making a commission back off the finance deal to make up the discount they're giving you on the metal. Best bargaining tool is good old fashioned pound notes. I've never take dealer finance - there's always cheaper options if you shop around.

3. Is doing as in Q2 asking for problems? I assume all finance agreements have a cancellation period.
Check the small print. I think you would be asking for problems, you should be able to settle it, but that will cost you. If you're going to get a finance agreement it should be for the right reasons.

Thanks Edd

Hope that helps out a little?

Auldie_2

Thank you for the replies. As I pointed out I can fund the purchase in cash but did just wonder if those methods could sweeten the deal, so to speak.

Wasn't aware that £notes still spoke louder than finance this day and age!

The car I am looking for will be between 5 and 7 years old.

Final question though, Do Honda main dealers have much of a discount margin they can play with.
I do believe that end of month is good time to haggle.....is that right.
This is to be honest my first nearly new car purchase as have previously bought bangers......lol

CLAPTON

I would say that 5-7 year old car is not really 'nearly new'

I think you are over thinking the situation

however, if you sign finance deal on the dealer premises then there is no cooling off period. However finance deals can be paid settled early... but make sure you get a copy of the contract BEFORE you agree to anything, take it home and read it carefully

Look at a variety of cars... at that age it will be difficult to compare like for like as mileage, extras, condition etc will vary from car to car.

When you haggle aways be prepared to walk away, there will always be other cars just as good if not better

At a dealer never accept anything lesss than 10% off.

Auldie_2

Thanks for reply.
5 to 7 years old is nearly new to me.....lol.

Plus while I have a reasonable budget £8k the vehicle I NEED to buy has to be around that age for me to afford. Is more a case of need than want. Would love to be able to buy newer.

Gillianh2

Have you thought of going to a Motor Auction.? Obvioulsy take someone with you who has a good knowledge of cars. This way you might get more for your money. Have a google and see if you an find an auction that deals with ex-motability vehicles. These have always been dealer maintained and have average mileage. You might pick up a newer car for your money.

Eric_Pisch

There are alot of advantages to using a dealer, although as you go down to the smaller dealers you can still have problems, main dealers generally dont want hassle when something goes wrong.

The car has to be fit for purpose, outstanding faults have to be put right by the dealer.

If the car is stolen or has a log book loan the dealer is liable, if you buy private and discover its stolen or has a log book loan you loose the car.

If you PX a car you don't have to worry about forged notes or stolen bankers drafts.

You get legal protection and piece of mind, but it costs.

Auctions can have bargains as can ebay but you need to know what you are doing, most of the trash with faults or bodged repairs are lost in the auction system.

Becarefull of HPI, it only lists recorded stuff, unrecorded accidents and log book loans are not covered

Auldie_2

Ty all for the replies and advice.

Eric_Pisch

Auldie wrote: »

Ty all for the replies and advice.

One good tip, you can check with main dealers that the service history matches what's in the cars book and what the mileage was at each service. This can often show up if a cars had its mileage electronically reduced (Very easy to do), if the mileage drops substantially for one year it may point to the car being of the road for repairs.