With many people changing their cars every 2-3 years, getting the best deal on a car can save some serious cash. 

In this article, we’ll discuss the cheapest way to buy a new car and the best places to look. So, what are you waiting for? Start reading now to secure your next deal!

Cheapest way to buy a car - the top 9 strategies 

From cash transactions to buying at the right time, these are the cheapest ways to get a car in the UK. 

1. Buy the car with cash

If you can afford to, buying a car with cash is always the most cost-effective option. It can avoid the downsides of the above finance options and work out considerably cheaper, but there are still points to consider. 

The finance vs cash decision is something that can take quite a bit of deliberation. Whilst financing can allow you to purchase a more expensive car without needing to outlay a large chunk of cash, it can end up costing significantly more in interest. 

2. Buy an older or unpopular car

Cars grow older and out of fashion and their prices drop significantly. This might not be the best option if you’re looking for a new, shiny car. However, it's a great way to get a good deal if you’re not fussed about brand names or car age.

3. Shop around for good loans 

Financing a car isn’t always the cheapest option, but it can be if you secure a favourable deal. 

To decide, first familiarise yourself with the different types of finance available including Hire Purchase (HP), Personal Contract Purchase (PCP), Bank Loans or Personal Contract Hire (PCH). 

Once you’re in the loop, you can start shopping for low-cost car finance. Look for deals with a low overall total cost rather than low monthly payment. To find a low total cost, you need to assess the length of the loan, the amount borrowed, and the interest.

4. Be flexible about your needs

Your dream car might not match your budget, so don’t be fixated on a certain brand or model.

Instead, assess your daily needs, look for cars that tick these practical boxes and explore brands you wouldn’t usually consider. You might be surprised at the prices you find! An open mind is key when looking for cheap cars.

5. Stay true to your budget

Setting a budget is paramount when car shopping. But don’t be tempted to go slightly above or discard the budget altogether! 

Of course, there are some situations where you’ll need a bit of wiggle room. However, remind yourself why the budget is there. It’s to protect your finances and guide you to a car that’s right for you.

6. Look at used vehicles

The used car market is one of the best ways to secure an affordable car. Prices for used cars are much lower than their newer counterparts, and they’re often just as high-quality. This is because car prices depreciate over time.

Used cars can be found online and at specialised dealerships. Look for certified pre-owned cars, which come with warranties and can offer extra peace of mind.

7. Consider private sellers

Sometimes, buying directly from a private seller can be much cheaper than buying from a dealership. However, you must check the car’s history and get it inspected by a garage before you confirm the sale. This way, you can be sure the car is safe and up to current standards.

8. Use online marketplaces

Online auto marketplaces are a great way to compare the best deals in one place and make quick comparisons. Autotrader, Kazoo, and eBay Motors are popular websites for UK buyers.

9. Buy at the right time

Did you know that dealers sometimes offer discounts and sales at the end of each month or quarter? That’s right. Since they need to meet targets, they often decrease the prices at the last minute.

Similarly, brands sometimes offer year-end sales, a strategy where you can buy last year’s model at a lower price. This happens just before the new models go on sale and it’s a technique dealers use to clear their inventory, offering you significant savings.

The cheapest places to buy a car

Since the internet, there are more ways to buy a car than ever. If you’re patient, willing to take a risk and have the knowledge (or a knowledgeable friend) on car faults, Facebook Marketplace and eBay can yield the best bargains.  

Here are some FAQs about the best places to buy cheap cars:

Is it best to buy a second-hand car privately or from a dealer? 

Generally, buying privately can get you more for your money, but with a private sale (from a non-business), you get no warranty or refunds. Sold as seen means you must find out if anything is wrong with the car before buying.  

Buying from a car trader/dealer

Car dealers exist for all price points. The likes of Cazoo and Cinch offer a wide range of nearly new cars, all with finance available.  

Car purchases from a business are covered under a specific section of the Consumer Rights Act, meaning if something goes wrong within a specific time period, you can get the garage to fix, replace or refund the car.  

Buying from a dealer typically costs 10-25% more than from private sellers.  

Buying a car on eBay 

Marketed as the online auction place, eBay has been the place for bargain hunters to pick up all kinds of items since its creation. Buying cars on eBay is certainly not out of the ordinary, with a specific site set up to do so.  

The benefits of buying through eBay, are found if you are patient. Whilst they are less common than they used to be, many people still run auctions on cars starting at very low prices.  

Tips for buying cars on eBay 

• Look for listings ending at anti-social times of the day, they usually have less competition and therefore sell for lower prices 
• Search misspellings of the car's name, as this also reduces visibility and competition
• Use the ‘sold’ filter option to see what similar cars have sold for in the past 

Autotrader

As well as a well-respected auto magazine, Autotrader has a long history of including car adverts, nowadays their website is still one of the most visited by those searching for vehicles to buy.

Adverts tend to be better listed than those on the marketplaces, this is because the adverts cost upwards of £20 list, meaning whether private or business, the seller takes more care over the description and photos.  

Facebook Marketplace and Gumtree

Since Facebook launched its marketplace a few years ago it’s become one of the most populated places to buy and sell online. There are some great bargains to be found, as there is so much competition on the platform.

When using these kinds of marketplaces - Gumtree included - it’s advisable to exercise caution as there are often various scam listings, we advise to never send money without seeing the car, even a deposit, and make sure you take care when viewing cars. 

The cheapest way of buying a car - the takeaway

The most economical way to buy a car can change depending on your circumstances. However, the strategies and places on this list should give you plenty of avenues to explore. 

Bookmark this page for your convenience, ensuring you always have the cheapest way to get a new car at your fingertips!

Once you’ve bought your new car, repairs and maintenance are inevitable, with Bumper’s pay monthly car repairs, we can help spread the cost into interest-free instalments. Find your nearest Bumper partner today. 

What is the cheapest way to finance a car?

PCP and HP are the best ways to buy a new car with finance, but which one is better will depend on the interest rate offered.  The various finance deals exist to allow those with different circumstances to pick one that best suits their needs.

What is HP? (Hire Purchase)

With HP, as the name suggests, you are paying monthly towards the cost of the car, after an initial deposit. Until all payments have been made, you do not own the car - hence Hire Purchase. When the last payment is made, the car is legally yours.

Unlike PCP, there is not a large payment to be made at the end, but there may be a small transfer of ownership fee.

Why choose Hire Purchase?

• You don’t need to pay 100% upfront for the car
• If you finish the contract, you’ll own the car
• An HP loan is secured against the car, meaning it’s better for those with a lower credit score 
• There’s no mileage limit

Downsides of Hire Purchase

• You pay interest in addition to the cost of the car (built into the monthly payments)
• Monthly costs can be higher than PCP
• If the car breaks in the contract period, it’s on you to fix it 

What is PCP? (Personal Contract Purchase) 

Another common way of getting hold of a new car is PCP, a monthly payment is made (often with a deposit at the start). At the end of the contract period (usually 4-5 years) a 'balloon' payment is required to purchase the car.

Whilst the name suggests the car is purchased, this is not a requirement of the contract, as you can return the car at the end of the term, if you do not wish to or cannot afford to pay the balloon payment.

Why choose PCP?

• You don’t need to pay 100% upfront for the car
• The monthly cost is lower than HP (on comparable cars)
• The cheapest way to drive a brand-new car
• Gives the option to own the car at the end of the contract

Downsides of PCP 

• Interest rates can be higher than other methods
• In many cases, the balloon payment is not cost-effective, as the car will be 4-5 years old
• PCP contracts have a yearly mileage cap

What is Personal Contract Hire? (PCH)

Personal contract hire is very similar to leasing, in that you can pay a small rental fee to begin the deal, and then a moderate monthly payment for the duration of the contract.

At the end, the car is returned to the financier, and there are no more fees to pay (apart from any damage or mileage outside the terms stipulated).

PCP can be a great option if you want to drive a brand-new car, but don’t want to own it, as the monthly fees are constant during the contract period.

Why choose PCH?

• No large outlay at the beginning of the contract
• No balloon payment at the end
• Get a new car every 3 or so years

Downsides of PCH

• Higher monthly payments than HP
• You will not own the car at the end of the contract
• Mileage limits are common

How to buy a car with a bank loan 

Banks will lend money for large purchases such as cars at reasonably good interest rates, especially when compared to most finance deals like HP or PCP. 

Once the loan is acquired you buy the car outright as if you are paying with cash. This means no finance contract with the dealership/trader. If your credit score allows and you wish to own the car outright, this can be a good way to go. 

Many car loans are ‘secured’ against the car meaning the bank will seize the vehicle as a way to get their money back if you don’t pay. 

Why choose a bank loan to buy a car?

• Better interest rates 
• You can own the car outright 
• No mileage limits 

Downsides of using a bank loan to buy a car 

• You cannot just return the car if you cannot pay 
• You need a reasonably good credit score to get a loan 

New car depreciation

If you are buying a brand-new car, you should consider the fact that it’s likely to lose half its value in the first three years. If you are set on a brand new car, and you don’t want to consider leasing or PCP, try to avoid certain makes and models to reduce the hit on deprecation.

The best cars for depreciation are listed on the Money Saving Expert’s website here, with MINI, Audi and Volkswagen taking the top places.

In some instances, the depreciation over the first three years may be more than the cost of leasing, so make sure to do your research.

What is the most cost-effective way to buy a car?

If you can afford to, the cheapest way to buy a car is with cash, as you won't pay any interest on the money you've borrowed.  

If you’d rather not get finance and cannot afford a new car, there are some great second-hand cars available for all budgets.