With the hefty price tags and high depreciation rates, it is no surprise that drivers are leaning towards secondhand cars more instead of brand new ones. According to experts, certain models can drop in value for up to 35% in the first year. Though the statistics reveal a pretty disheartening number, there are still ways in which you can fulfill your dream of getting a brand new pre-registered car of your own, while saving some coins during the process. And while we are on the topic of getting a new car, make sure to not forget to get your car protected by insurance at https://www.youi.com.au/car-insurance.
What are pre-registered cars?
In order to understand what pre-registered cars are, we first have to go back to the basics. A car dealer measures his success based on the number of sales that he or she makes, and like other salesmen, they also have targets to meet. In order to achieve their quotas, dealerships will sometimes opt for buying the cars themselves and register them as sold with the Driver and Vehicle Licensing Agency (DVLA). These will then be known as pre-registered cars. Since the first owner of the car is technically registered with the dealer, these cars are classified as secondhand cars, despite its low mileage and it being just a few weeks old.
Pre-registering new cars, and then selling them at a lower price to customers does not necessarily mean that dealers are losing money. The manufacturer’s bonuses are usually able to cover the costs and at times outweigh the difference in costs.
When should I get a pre-registered car?
A rule of thumb is to wait till March or September, because those are the periods when new number plates are registered, with the largest supply of cars available. Those months also come with higher quotas for dealerships, making it easier to get a better deal. If you want to take advantage of cheap deals, be sure to visit the dealerships at the end of the month, as they usually have monthly and quarterly targets to hit as well. However, if you have some extra cash lying around, you can just proceed with getting a car whenever you need it. With a higher budget, you will also have the luxury of picking something that attracts you, as well as focusing on the functionality of the car.
When you are at the dealership, a tip is to look out for cars with the sign that says “new” and is heavily discounted but is already attached to a number plate. These are the cars that are most likely pre-registered, and you’ll pay significantly lower prices for them.
What can I expect with a pre-registered car?
When getting a pre-registered car instead of a brand new car, you can expect discounts from 5% to 15%, though the prices may vary depending on each model, and how desperate the dealership is to get the car off the forecourt. However, one thing to take note of is that if you think about finances, the retail price that pre-registered cars are discounted at may not mean lower monthly installment payments. You should also lookout for the miles on the clock. Most pre-registered cars should have less than 200 ‘delivery’ miles unless it has been used as a demonstrator car, which can hit slightly above 200. It should also typically be under six months old and check with the dealership if it is a lot older than that.
What should I look out for when purchasing a pre-registered car?
Before you immediately say “I do” to your car, it is best to do some research on the model in question. If you realize that it has to be replaced or facelifted soon, this gives you a great opportunity to further haggle over the price. Furthermore, you should ensure that you receive the new keeper supplement section of its V5C logbook and the sales receipt when the dealer sends it to the DVLA.
Moreover, you should take out GAP (Guaranteed Asset Protection) insurance if you are getting a pre-registered vehicle. This is because your insurer will likely pay out the car’s market value before any accident since you are the second registered keeper of the car. This ensures that the GAP policy will compensate for any potential shortfall in price between this amount and the amount that you owe the finance company.
What are the cons of getting a pre-registered car?
One of the biggest drawbacks of getting a pre-registered car is the value that it can be sold for when you decide to change your car. Even though it is practically new and you are the first legitimate owner of the car, you are still technically the second owner, thus making its value decrease when you decide to sell it. This will not fetch you the price at which your car is truly valued, causing you to make a potential loss. However, if you do not plan to sell it before the car has to go to the scrapyard, getting a pre-registered car will definitely be worth your buck.
Additionally, you have to take note of the manufacturer’s warranty. The warranty period starts the minute the car is parked in the forecourt. Hence, the longer the duration of the car idling in the forecourt, the shorter the warranty available for your car. This is different from that of a brand new car, whereby the warranty starts the moment you get the keys. This puts you at a slight disadvantage, risking the chances of a faulty part after the warranty has ended.
For drivers who prefer to customize and optimize a car to their liking, pre-registered cars are not the most suitable due to them being already fitted with optional extras. Furthermore, drivers are unable to choose and customize the spec as well.
Final Words
When it comes to purchasing a pre-registered car, it is all about slashing the prices further but getting the same standard and ideal condition that brand new cars have to offer. Though you are the first owner to drive on the roads, you are technically the second owner on paper. Hence, it will prove to be a problem when you choose to sell it, as your car will have a lower resale value than what it is actually worth. Despite that, getting a pre-registered car can help you reduce costs by up to 15%, while not compromising on the performance of the car.