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The Advantages, and Disadvantages, of Buying a Pre-Registered Car

By Edited May 3, 2016 1 2

As well as the standard options of new and used cars, and the less common option of buying an ex-demonstrator (a vehicle used by the car dealer for test drives), there is another, and even less common, option of buying a dealership pre-registered car.

What is a Pre-Registered Car?

Logbook
A pre-registered car is a brand new car that a car dealer has registered with the dealership as the owner, and can therefore not be sold as a new car. When a new car is purchased, the purchaser is the first owner of the car; with pre-registered cars the sales dealership is. Pre-registered cars are usually only available from main dealerships, as these are the primary source of new cars from any manufacturer.

Pre-registered cars are not the same as ex-demonstrators, even though ex-demonstrators may never have actually been registered by the dealer, instead only having been driven on trade plates.

Why Would a Dealer Pre-Register a Car?

Pre-Registered Car
Given that once a car is registered, it can no longer be sold as new, why would a dealer want to pre-register a car? One common reason is to meet sales targets. Once a car has been registered by the dealer, it is considered "sold" and can be removed from the books as a new car. Thus, if during a specified period a dealer is lagging behind their sales targets, they can register several cars to meet them. Which is admittedly purely paperwork and actually will result in the dealer losing hundreds if not thousands of pounds in sales revenues on the pre-registered cars, although it can still be worth it depending on how their sales targets are handled, especially if there are bonuses for meeting said targets.

Should a new model of a car be released, or be set be released shortly, a dealership may want to get the old models off its books as new cars, so will pre-register them to transfer them to the used car department.

What Are The Advantages?

Pound
The advantage is simple - the car is cheaper than a brand new previously unregistered car, The saving is usually at least in the hundreds and can be in the thousands of pounds range, depending on the car. You are effectively getting a brand new car at the price of a second-hand one. Even ex-demonstrator cars aren't as good as this, as demonstrators have usually been driven by a lot of different people and often have several thousand miles on the clock. Pre-registered cars often will still only have delivery mileage.

What Are the Disadvantages?

There are downsides to buying pre-registered vehicles. It is possible for these to make buying a pre-registered vehicle not worthwhile.

You Are Not the First Owner

This means that when you come to sell the car, you are selling it with two owners on the logbook, not one, even if the first owner did not use it. This is not always as big a disadvantage as it sounds. It mostly applies when selling privately, especially if the private seller has not heard of pre-registered cars. When part-exchanging or selling to a garage or dealership, they are usually aware of pre-registration (although that won't stop them using it as an excuse to lower the price) and their prices are usually more immobile and less influenced by minor deviations than private buyers.

Shorter Manufacturers Warranty

Warranty Badge
Manufacturer warranties for new cars start from the moment it is registered. So, if you buy a car that was registered two months prior to purchase, you will have lost those two months of the warranty. It is advisable to check when the car was registered; losing a month or two of warranty may not be that big a deal, losing six months of warranty is more of a problem.

Shorter MOT Free Period

MOT Certificate
New cars do not require an MOT for the first three years. As with the guarantee, this also starts the moment the car is registered, and the same applies here, you losing any time that was between the car being registered and it being purchased. Again, check when the car was registered.

Other Offers Reduced

Should a new car come with additional benefits such as free car insurance or breakdown cover for a set period, these will also usually start the moment the car is registered, not the moment the car is purchased. As with the previous two, the date the car was registered is important.

You Don't Get As Much Choice

Pre-registered cars are limited as to what is available. You can't choose things such as colour, paint type or many optional factory added extras - although aftermarket extras can always be added. The only cars you can have are those the dealer has registered. You also lack the same range of choice in car brands; you are limited at any time to those dealers who currently have such cars in stock. Not every dealer pre-registers, especially for higher priced cars, and there is no guarantee at any particular time that a particular dealer - or even any dealer in your area - will actually have any for sale.

Which Should I Do?

Question Mark(102430)
On the face of it, the disadvantages outnumber the advantages. After all, there is only one real benefit to buying a pre-registered car - the price. This advantage can, however, has the ability to seriously outweigh the disadvantages. The car, after all, is usually over £500 cheaper and could be over £1,000 cheaper, or much more, which could be a bigger saving than the loss from the disadvantages.  For example, if you plan on disposing of your car after two years, then not having a full three years of warranty is likely to be less important.

Whether you go down the pre-registered route is a matter of personal preference. There are substantial savings, but each car needs to be looked at individually. Cars that have been pre-registered for many months are not as good a deal as ones that have only just been registered. If a car has been pre-registered for many months that also suggests a problem with the car itself; not with the individual car but with the make and/or model. In addition, there may not be any pre-registered cars available when you are looking to buy a car.
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Comments

Jul 12, 2012 7:27pm
yummy-treasures
Good article and congratulations on winning the June contest!!
Thumbs up!
Jul 13, 2012 1:42am
egdcltd
Thanks!
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