Plan your route to a better new car deal

With new 07 car registration plates just around the bend, the next few weeks could see over £800 million wasted as people drive their new cars off the forecourt.

Buying a new car online

Opting to purchase a new vehicle via a high street dealer could mean paying well over the odds for a new set of wheels. Instead, buying online could save motorists thousands of pounds on their dream car. For example, moneysupermarket.com looked at the most searched-for cars on its website and found a saving of £3,728 can be made on the list price of a Vauxhall Astra Design, with this car retailing at £15,935 on the forecourt, compared to £12,207 at moneysupermarket.com.

Richard Mason, director at price comparison website moneysupermarket.com, said: “Our research reveals only three per cent of people have bought a new car online and therefore a massive 97 per cent are missing out on the savings to be made. Whilst people are willing to buy expensive goods such as flat screen TVs online, often having identified what they want in the showroom, they are more reluctant to buy a car in the same way. Instead, drivers prefer to deal face to face and test drive before they commit to purchasing. However, the chance to knock nearly a quarter off the list price just by buying your new car online should make far more motorists sit up and take notice of this opportunity.”

Financing your new purchase

Once the decision has been made on what car is going to be purchased, it is important to consider the best means of financing it. Research from moneysupermarket.com shows that driving off with forecourt finance rather than a low-rate loan when buying a new 07 car could collectively cost UK motorists up to £3.5 billion.

Data released today shows new car buyers could save more than £1,400 each on average over three years by shunning showroom finance and opting for a low-rate personal loan. A driver buying a new Ford Mondeo costing £14,575.49 (£16,195 minus ten per cent deposit) via the Ford finance deal at 12.5 per cent APR would repay a total of £19,003.49 over three years. However, buying the car with an Alliance & Leicester personal loan at 5.9 per cent APR means the buyer will only repay a total of £17,530.79 - a saving of £1,472.70.

Richard Mason continued: “Our figures show consumers should be wary of showroom finance deals. Taking out a low-rate personal loan instead means they can avoid paying over the odds. After spending time getting the best price on their new car purchase, people ought to find the most cost-effective way of paying for it.”

Ensuring you have the best value motor cover

moneysupermarket.com also urges drivers to review their motor insurance when buying a new vehicle, especially those who bought a new car last February with a year’s free insurance.

Richard Mason said: “Receiving a year’s free cover is a great perk when buying a new car, but one year on you could find yourself paying a hugely inflated premium, as the policy the car dealer arranges for you is unlikely to be very competitive.

“Many insurers will operate at a loss over the first year of a policy, and then look to rack up the profit on expensive renewals. By shopping around, you can take advantage of the new customer discounts, ensuring you get the best deal for your insurance. If you have not made a claim in the past twelve months, you should normally expect to be paying less than you did the previous year.”