Selecting the Right Variety for Your '57' With New Car Registrations Only a Couple of Weeks Away, Prospective Buyers Should Check Out the Financial Details Before Signing on the Dotted Line

By Rosemary Gallagher

IN JUST a few weeks, the new "57" registration number plate for cars will be on the street.

But anyone contemplating buying a new car come 1 September should do their research into how to finance it, given the plethora of options on the market.

It seems too many people are getting so caught up in the excitement of getting a shiny new vehicle they could be losing out on considerable savings or signing up for a finance deal that does not suit them.

One in three admits before signing on the dotted line to buy a new car they would not think about getting an insurance quote to see how much it would cost per year, or to see if they were insurable, according to research from esure. And two fifths would not do their research to find out the car's insurance group - a factor that can have a significant affect on insurance premiums.

People are also reluctant to haggle. One in ten believes the advertised price tag on a new car is firmly set and can not be changed. Women are less likely than men to barter with salesmen - 79 per cent of men would haggle while only 72 per cent of women would consider bargaining to secure a lower price.

Worryingly, thinking about finances is way down the list of motorists' priorities. Whereas a fifth would undertake thorough research before choosing a car make and model, a quarter would spend less than an hour, if any time at all, researching how to actually pay for it. They risk losing out on considerable savings or signing up for a finance deal that doesn't suit them.

Many are also baffled by financial jargon. Some people surveyed actually thought that the term "hire purchase" referred to a holiday car rental.

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, yet motorists 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 to 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."

Once people do think about how to pay for their car, it seems they are more likely to choose a finance package in the showroom over a personal loan, although cash remains king.

The research from GMAC revealed withdrawing cash from a savings account is the most popular way of funding a car purchase - 53 per cent would choose this route.

This is followed by nearly one in four who would go for a finance package from the retailer, compared with just 15 per cent who would choose a personal loan from a high street bank.

When asked what would most influence a decision to take out showroom finance, more than a third of all respondents said their personal experience with the retailer - for example the attitude and expertise of the finance advisers - would be the single most important factor.

Benefits such as an extended service and maintenance options are also relevant.

Ed Paulat, GMAC's UK managing director, said: "The results of this survey expose the myth that car buyers consider retailer finance to be complex, expensive and out-of-touch with their needs. Although it might be difficult for the direct loan providers to accept, the truth is that retailer finance is extremely convenient and flexible. What's more, it can compete with the very best personal loan rates available, which are often only accessible to those people with the very best credit records."

For example, 0 per cent APR is available on a number of different models across the Vauxhall range from many franchised retailers throughout the UK, with car buyers paying only the list price of the vehicle.

Paulat added that, when taking out a finance package in a showroom, car buyers are protected by stringent standards and regulations.

HOW TO KEEP THE COST DOWN

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

* The best discounts are often available by going online.

* Motorists should try to drive down the cost of their insurance by: finding out the car's insurance group; checking the level of security that comes as standard and consider fitting a tracking device; and not adding non-standard or unapproved 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.

Source: esure

(c) 2007 Scotsman, The. Provided by ProQuest Information and Learning. All rights Reserved.