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Ways to drive down cost of buying and financing a new car

16th August 2007 Print
With the new ‘57’ registration number plate out in just a few weeks time, research by esure motor insurance reveals that motorists looking to buy a new car aren’t doing their homework before stepping on the forecourt which could cost them dear: potentially an unaffordable insurance premium, an uncompetitive sales price, and an unsuitable finance deal.

One in three Brits (35%) admit that before signing on the dotted line to buy a new car that they wouldn’t think about getting an insurance quote to see how much it would cost per year, or to see if they were insurable. Furthermore, two fifths (43%) wouldn’t do their research to find out the car’s insurance group – a factor that can have a significant affect on insurance premiums.

The research also confirmed that we’re not a nation of hagglers. One in ten Brits (11%) believe that the advertised price tag on a new car is firmly set and can’t be changed or negotiated down in any way. Women are less likely than men to barter with salesmen – 79% of men would haggle with a car salesman whilst only 72% of women would consider bargaining to secure a lower sales price.

Thinking about finances is way down the list of motorists’ priorities. Whereas a fifth of Brits (19%) would undertake thorough research - spending over 20 hours flicking through car magazines and viewing cars – before choosing a car make and model, a quarter (26%) would spend less than an hour, if any time at all, researching how to actually pay for their new car. They could be losing out on considerable savings or signing up for a finance deal that doesn’t suit them.

Brits are also baffled by finance jargon when it comes to funding the purchase of a new motor. One in 20 (5%) people surveyed actually thought that the term ‘hire purchase’ referred to a holiday car rental and 6% just didn’t have a clue.

Colin Batabyal, Director of Underwriting and Business Development at esure, said: “As a nation we’re always out for a bargain and value for money,yetmotorists aren’t putting this into practice when it comes to buying a new car. It is crucial for all motorists to do their research before stepping on the forecourt and be one step ahead of the salesman. Being shrewd and shopping around for the best price, finance and insurance deals could slash hundreds, if not thousands off the cost of driving away in a new ‘57’ plate.”

esure offers some top tips on keeping the cost of insuring a new car as low as possible:

Drivers looking to buy a new car should shop around for insurance quotes before signing on the dotted line, as well as contacting their current insurer to see by how much their current premium will be affected to ensure that it’s affordable.

The best discounts are often available by going online rather than buying over the phone.

Motorists should try to drive down the cost of their insurance by: finding out the car’s insurance group (the higher the group, the higher the premium); checking the level of security that comes as standard and consider fitting a tracking device; and not adding modifications that could either void or increase the cost of their insurance policy.

When motorists shop around for car insurance, price is at the top of their minds but having a good quality product is also crucial – especially if the unexpected does happen. Drivers should know what’s included on their insurance policy and what’s excluded. Many insurers no longer offer ‘driving other cars’ cover and some policies don’t offer courtesy cars as standard. It’s crucial to read the small print.