Money: A new motor with no hassle

Now you can buy a car over the internet, writes Stephen Pritchard

If you want to buy a car but are putting it off because you hate visiting car showrooms and haggling with pushy salesmen, then your wait could be over. The phone and the internet look set to revolutionise car buying for the nervous, the lazy and the uninterested. You can sort out everything - the car, a loan with which to buy it, insurance, a roadside rescue scheme - and have it delivered.

There are two schemes offering "total motoring" deals at the moment: Freeway, from the Bank of Scotland, and Motorbase, launched last week by the Woolwich.

Motorbase combines all your motoring costs into a single monthly payment, which can include one or more items from a "menu": selecting the car, finance repayments, insurance, maintenance and rescue cover.

If you want to check what Motorbase offers, call up or visit the website for a quote. A car leasing company (PPH) has teamed up with Woolwich and uses its buying power to negotiate prices up to 25 per cent lower than the manufacturer's list price.

If you have the cash you can buy the car outright, or finance it via the Woolwich. It offers a choice of packages: a simple repayment loan where you pay pay a large deposit and monthly payments; or a personal contract plan (PCP) , where you pay a reduced monthly payment and a large part of the cost of the car is deferred until the end of the contract period, usually three years. Drivers can then buy the car outright with a lump sum, trade it for another contract on a new car, or walk away. The Woolwich expects the PCP option to be popular - and it pushes it hard on the website.

Interest on repayments is charged at 9.9 per cent, which compares favourably with an unsecured personal loan. The package also offers a maintenance deal, which covers servicing, repairs and wear and tear such as new tyres. Maintenance costs start at around pounds 30 a month for a small car such as a Vauxhall Corsa.

Bank of Scotland's scheme, Freeway, has been running for four years. As with Motorbase, Freeway customers buy their cars over the phone, and pay for them using PCPs. The monthly charge can include servicing and maintenance. The disadvantage is that Freeway does not discount cars, but sells them for the "full on the road price".

The reduced monthly outgoings of PCPs mean that customers can drive more expensive cars than they'd get with a normal loan. The deferred part of the cost - the guaranteed future value - is based on an estimate of the market price for the car after the contract ends. Buyers of up-market cars with below-average depreciation, such as a Mercedes, Volvo or BMW, will have proportionally lower monthly payments. If they want to keep the car, however, they will have to find more cash at the end of the contract period.

All PCP deals have mileage restrictions, so they may not suit all drivers. The idea of walking away at the end of the contract sounds flexible, but it does mean you'll have nothing to trade in against another car.

Services such as Motorbase and Freeway score over forecourt deals because buyers are not tied to one make of car, and there is no haggling over the finer points of the car's price or the cost of any finance.

But there are some drawbacks. Motorbase admits it will not be able to negotiate discounts with all manufacturers. The more exclusive manufacturers are less likely to cut costs. Motorbase cannot guarantee test drives - this depends on the goodwill of local dealers - and there is no chance to part-exchange or trade in your existing car. Woolwich expects the scheme to appeal to former company car drivers, who have nothing to trade in.

The advice from motoring organisations is to check the full cost of buying a car, including trade-ins or part exchange, interest rates, insurance charges and any discounts. "Research all your avenues carefully, read the small print, and make sure you can afford it," says Jonathan Simpson, from the RAC. "Motoring costs are soaring at the moment."

n Contacts: Freeway, 0345 697311 or www.freeway- cars.co.uk; Motorbase, 0870 607 2727 or www.motor-base.co.uk

SAMPLE COSTS

PCP contracts over 36 months charged at 9.9 per cent interest

Vauxhall Corsa 12V

Cash price pounds 6,833

Deposit pounds 1,200

Monthly payment pounds 99.65

G'teed future pounds 3,366.42 value/final payment

Renault Megane Scenic RT Alize

Cash price pounds 14,126.83

Deposit: pounds 5,000

Monthly payment pounds 138.53

G'teed future pounds 6,372.34 value/final payment

Source: Motorbase

Start your day with The Independent, sign up for daily news emails
News
ebooksAn unforgettable anthology of contemporary reportage
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs Money & Business

Recruitment Genius: Digital Optimisation Executive - Marketing

£30000 - £35000 per annum: Recruitment Genius: The UK's fastest growing, multi...

Recruitment Genius: Financial Reporting Manager

£70000 - £90000 per annum: Recruitment Genius: A Financial Reporting Manager i...

Recruitment Genius: Payments Operations Assistant

£23000 - £25000 per annum: Recruitment Genius: They win lots of awards for the...

Recruitment Genius: Telephone Debt Negotiator

£13500 - £20000 per annum: Recruitment Genius: This nationwide enforcement com...

Day In a Page

Syria civil war: Meet the military commander who says his soldiers will not rest until every inch of their war torn country is free of Islamist 'terrorists'

‘We won’t stop until Syria is back to normal’

Near the front lines with Islamist-controlled towns where Assad’s troops were besieged just last month, Robert Fisk meets a commander confidently preparing his soldiers for battle
Fifa corruption: Strip Qatar of the World Cup? Not likely

Strip Qatar of the World Cup? Not likely

But if a real smoking gun is found, that might change things, says Tom Peck
Twenty two years later Jurassic Park series faces questions over accuracy of the fictional dinosaurs in it

Tyrannosaurus wrecked?

Twenty two years on, Jurassic Park faces questions over accuracy
The inside story of how Bill Clinton built a $2bn global foundation may undermine Hillary's chances

The inside story of how Bill Clinton built a $2bn global foundation...

... and how it may undermine Hillary's chances in 2016
Genes greatly influence when and how many babies a woman will have, study finds

Mother’s genes play key role in decision to start a family

Study's findings suggest that human fertility is still evolving
12 best olive oils

Extra-virgin, cold-press, early-harvest, ultra-premium: 12 best olive oils

Choosing an olive oil is a surprising minefield. Save yourself the hassle with our handy guide
Rafa Benitez Real Madrid unveiling: New manager full of emotion at Bernabeu homecoming

Benitez full of emotion at Bernabeu homecoming

There were tears in the former Liverpool manager’s eyes as he was unveiled as Real Madrid coach. But the Spaniard knows he must make tough decisions if he is to succeed
England can win the Ashes – and Elvis Presley will present the urn

England can win the Ashes – and Elvis will present the urn

In their last five Test, they have lost two and drawn two and defeated an India side last summer who thought that turning up was competing, says Stephen Brenkley
Sepp Blatter resignation: The beginning of Fifa's long road to reform?

Does Blatter's departure mean Fifa will automatically clean up its act?

Don't bet on it, says Tom Peck
Charles Kennedy: The baby of the House who grew into a Lib Dem giant

The baby of the House who grew into a Lib Dem giant

Charles Kennedy was consistently a man of the centre-left, dedicated to social justice, but was also a champion of liberty and an opponent of the nanny-state, says Baroness Williams
Syria civil war: The harrowing testament of a five-year-old victim of this endless conflict

The harrowing testament of a five-year-old victim of Syria's endless civil war

Sahar Qanbar lost her mother and brother as civilians and government soldiers fought side by side after being surrounded by brutal Islamist fighters. Robert Fisk visited her
The future of songwriting: How streaming is changing everything we know about making music

The future of songwriting

How streaming is changing everything we know about making music
William Shemin and Henry Johnson: Jewish and black soldiers receive World War I Medal of Honor amid claims of discrimination

Recognition at long last

Jewish and black soldiers who fought in WWI finally receive medals after claims of discrimination
Beating obesity: The new pacemaker which helps over-eaters

Beating obesity

The new pacemaker which helps over-eaters
9 best women's festival waterproofs

Ready for rain: 9 best women's festival waterproofs

These are the macs to keep your denim dry and your hair frizz-free(ish)