What are pre-registered cars?

Instead of paying full price for a brand new car, you could save thousands on a virtually new 'pre-reg' model. Here are the details

Simon Ostler
Aug 4, 2021

Many of us enjoy the feeling of driving a brand new car, but the cost of buying a new car is decidedly less enjoyable, especially when you discover that pre-registered versions of the same car are available with thousands of pounds knocked off the price. Best of all, there aren't any telltale signs that the car isn't every bit as new as a full-price model.

There's nothing more satisfying than paying substantially less for a car that, for all intents and purposes, is entirely new. The discounts offered on pre-registered cars can be huge, but the car you're getting is likely to have travelled just a handful of miles, with the look and feel of a brand new model.

BuyaCar has a mouthwatering selection of 664 pre-registered cars currently available, with thousands of pounds to be saved compared with the price of equivalent brand new models. But you may be wondering what a pre-registered car actually is, or indeed how you actually go about getting one.

Read on for all the details, and to find out how you can stretch your budget to get your hands on a practically new car - either the one you were hoping for, or perhaps something even better.

BEST PRE-REGISTERED CAR DEALS

What is a pre-registered car?

Pre-registered cars are initially bought and owned by a car dealer, broker or leasing company and that dealer’s details will appear on the vehicle’s logbook (or V5C) as a registered owner. Therefore, when a customer purchases the car they will count as the second owner, essentially making it a 'used' car - even though it may only show a handful of miles on the clock.

It's this difference between 'used' and 'new' that makes pre-reg cars cheaper, as the initial loss of value that a new car suffers as soon as it leaves the forecourt for the first time will have already occurred - saving you from having to take that financial hit and instead allowing you to benefit from it.

The reason dealers buy these cars first is due to the financial incentives offered to them by manufacturers; dealers using the additional 'sales' for their own books in order to meet sales targets. These cars will then be held in stock on forecourts and in many cases will not be driven at all - so they should have precious few miles on them and won’t have been used for customer test drives.

The basic upshot here is that opting for a pre-registered car will get you something that is practically brand new, although you won't be the first registered owner. Remember, even a shiny brand new car may not have been built all that recently, depending on where it was built and the time it took to get to your local dealership.

What happens to pre-registered cars?

Pre-registered cars will initially have been up for sale as new cars. If for whatever reason a dealership ends up with remaining stock, it can then choose to register these cars in order to present them as 'sold' on a technicality. The fact these cars will have been sitting on the forecourt for an extended period and have now been registered by the dealership serves to lower the price of the car considerably.

For a car to qualify as pre-registered, it shouldn’t be more than six months old or have more than 200 miles on the clock. Once it has gone beyond that threshold, it is then put up for sale as a used car, so you can still find 'used' cars with less than 200 miles on the clock that are older than six months if you're lucky.

As you may have guessed from the name, pre-registered cars also come with registration plates (number plates), whereas unregistered brand new cars won’t. While we doubt the combination of letters and numbers that you’re given will matter to a lot of drivers, you do sometimes get to choose your new registration from a handful of options when you buy a brand new model.

What sort of discounts come with pre-registered cars?

Discounts on pre-registered cars can be anywhere between 5% and 25% of the initial price, which can add up to many thousands of pounds if you're looking at a larger family car like a Nissan Qashqai or Volkswagen Tiguan, but these discounts can vary, so we'd recommend shopping around if you want to maximise your savings.

In the end, the sum of the discount will boil down to how keen the seller is to move the vehicle on. If it's been sat on the forecourt for five months then they will probably be quite keen, but it's always worth a quick haggle to see just how low they will go.

New car deals vs pre-registered

With all that said, it would be wrong to assume that going for a pre-registered car is the only way to secure a big discount. There are always savings to be made, even if you decide to go for something brand new.

Manufacturers are always interested in doing a deal and in the past they would often slap large discounts on new cars for cash buyers. However, in the 2020s you're more likely to be able to take advantage of what's known as a deposit contribution - a discount for customers taking a finance deal.

In both instances, you will be saving money on the price of a new car and that's not to be sniffed at. Whenever comparing finance options, it's always worth getting like-for-like quotes (with the same finance type, deposit amount, contract length and mileage allowance) to understand which offers you the best value.

However, there are other considerations like road tax that you should take into account when considering whether to go for a new car or a pre-registered model. On the road (OTR) costs will often inflate the price of a new car, as you are required to pay for the car's initial registration and the first year of road tax - the cost of which will depend on the CO2 emissions of the car. Depending on the make and model of car you’re looking at, the first year’s road tax could be as little as £160 or so, or as high as £2,000 or even more.

Those OTR costs are taken away if you decide to go pre-registered. We're always updating our offers here on BuyaCar, and our pre-registered deals typically provide you with substantial savings over new car prices.

Are pre-registered cars the same as ex-demo cars?

First things first, the dealer is obliged to declare the status and history of a car to the buyer. The idea of a pre-registered model is that it should feel brand new, so a pre-registered car can only be marketed as such if it has not been used. If you are purchasing a vehicle that has been used as a demo or courtesy car, it should be clearly stated and you should expect to see a lower price tag.

It's not always easy to make the distinction, but the best way to tell the difference is by checking the car's mileage. A genuine pre-registered car will have only covered a handful of miles - and certainly no more than 200.

A demonstrator or courtesy car may have covered a few thousand miles in the hands of staff or other drivers, which is sure to have taken off the shine somewhat. It should make a major difference to the price and while there's absolutely nothing wrong with a car that has covered several thousand miles, the value should be lower for these than pre-reg models.

What are the disadvantages of a pre-reg car?

Some of us know what we want, and we want it just so. You may want bright yellow paintwork, red leather upholstery and wood trim in your next car and you're unlikely to find that exact combo in a pre-reg car. You can’t be too fussy about the colour, engine, gearbox and options fitted to a pre-registered car because you can only choose from what’s available, although there will normally some amount of choice.

It's also worth remembering that as a pre-registered car is effectively second-hand, the dealer is the first owner and you'll be indicated as the second owner of the car. That all changes if you're ordering a new car though, and you can set yourself loose on the configurator and build the perfect new car exactly as you want it. This will appeal to some, and if you're one of them, this decision will be an easy one to make. You may have to wait several weeks or even months for a car to be built to order to your exact specification. 

It's also worth bearing in mind that, due to the cash discount you get with a pre-registered car, the finance deals available might not be as good as they would otherwise be, since car manufacturers often subsidise the cost of new car finance, rather than discounting cars. As a pre-reg car is already discounted, however, you may not be able to take advantage of the best new car finance deals and may have to pay higher interest rates.

So, if you are intending to take finance, it's worth getting like-for-like finance quotes on pre-reg and new models to work out how the monthly payments compare. If the cash saving is large enough on the pre-reg model that will work out cheaper, since you're borrowing much less money, so the slightly higher interest rate may not make much difference. If, however, the finance discounts are large enough on new models, these could potentially work out cheaper.

A further consideration is the impact on the warranty. The manufacturer warranty will have begun the day the vehicle was first registered - not with you, but the dealer. Given that a pre-registered car could be up to six months old, that means you may lose out on a significant period of cover. Try haggling over this point, or see if the dealer will put additional cover in place.

It also pays to be mindful of the impact on insurance. Some insurers will replace brand new cars with like-for-like models for a period of time, but not with a pre-registered car because it is considered second-hand. This is where it could be wise to use a GAP insurance product to cover the shortfall between motor insurance payout and the price of an equivalent replacement vehicle.

 

Read more about:

Latest advice

  1. Car leasing with maintenance

  2. What is E10 fuel and can my car use it?

  3. Outstanding finance on a car