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Did you remember to wish your car a happy birthday?


It pays to keep an eye on the calendar when buying or selling a car, as every year on the 1st of January all cars have a birthday which can influence a number of factors.

Firstly, let’s consider the following points if you are looking at buying or selling a secondhand vehicle..

Once the new year ticks over, this can be a great time to get a great buy. That 2 year old 2015 model is now considered 3 years old. Keep this in mind when negotiating a price.

If you are looking to finance a vehicle, many lenders are looking at the age of the asset not being older than 12 years at the end of the loan. This therefore means you may have to look at reducing the term of the loan so it meets this requirement. We find most customers look at a 60 month or 5 year term to keep repayments at a manageable level, however if there was a particular vehicle you are looking at purchasing you may now have to look at a shorter term of, for example, 48 months or 4 years which may increase your repayments.

Pay attention to build date of the car as this is the number that most lenders use to ascertain the age of the vehicle rather than the compliance date. This also applies when buying new.

When selling you may find you get a better price by finalising the sale prior to the end of the year, or otherwise consider reducing your price to become more competitive in the market if you sell in the new year.

Next, lets look at some things to think about if you’re buying a new car..

It is not uncommon for new car dealerships to have vehicles in stock plated with the previous year at the start of a new year. This can give you more negotiating power if you’re happy to buy a 2017 plated vehicle in early 2018.

When buying brand new it is commonly known that cars depreciate at the highest rate within the first few years. It is therefore a smart move to have an idea on how long you are wanting to keep the car for. If you plan on keeping it for more than 5 years, buying the previous year model will not have as much of an effect. However, if you are looking to turn the vehicle over in 2-3 years time it would generally be considered unwise due to this higher rate of decline in value.

Once again, pay attention to build date of the car as this is the number that most lenders use to ascertain the age of the vehicle rather than the compliance date.

The final word..

These are just a few things to consider and another reason why using the services of an independent car finance specialist (when you plan on getting a loan to buy a car) can assist you in considering all of these along with other factors before taking the leap and making a purchase.

So, unless you are looking at buying or selling a car, the 1st of January each year could just be another great excuse to eat cake, ruin your New Year's diet resolutions and celebrate your car’s birthday.

Disclaimer: The above information expressed is our opinion and should be considered as general information only. Street Wise Finance is not a financial advisor. Please consider seeking independent legal, financial, taxation or other advice on how your unique circumstances relate to the information provided. Street Wise Finance accepts no responsibility or liability for any loss caused due to either negligence or otherwise arising from the reliance on or use of this information, directly or indirectly, by use of this website.

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