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So, what are the risks?
1) If you are handing your deposit/final balance to anyone other than a main franchised dealer, then you are not buying it from a main dealer - you are buying it from a third party ‘re-seller’ and your contract to purchase is with them, not a main car dealership.
You have no visibility of the order or the sale, and no dialogue with the dealership. The dealership views the third party as their customer, not you.
None of these contribute to a safe or healthy situation for you to be in if something goes wrong, as neither the manufacturer nor dealer will help you - you have handed money and your order to a re-seller who is not franchise-approved by the manufacturer to sell the product and may be abusing someones fleet terms to get you the price. If they are found out, and your car is still on order, are they going to to give you your money back?
If the company you’ve handed money too goes “bust” before you’ve got your car, you’ve got a problem as your purchase arrangement was with them, not the supplying dealer. In instances where these types of brokers have gone into receivership, drivers have found themselves with no car, and the “rental companies” (real, or merely “fronts”) will be wanting you to pay for the car all over again as they have not been paid by the broker you handed your money to and certainly won’t release a car until someone has paid them for it.
Where you’ve allowed a third party to take your money and you are relying on them to pass it on to the dealer supplying the actual car, then you are at the heaviest risk.
2) Insurance - when applying for cover you will be asked to state if you are the registered owner and keeper of the vehicle. If you tick ‘yes’, your insurance policy may be deemed invalid - as of course your name will not be identifiable on the V5 and nor will you be able to produce the V5 in the event of an accident or claim. You need to specifically ask your insurer if they will still cover you if you are not shown on the V5.
You are not the registered owner UNTIL you are in possession of the V5 with your name on it...so if you tell your insurance company that you are the registered owner...it is a falsification on your insurance application. You could find yourself unable to claim if you find yourself in a total loss situation, or a lenient insurer may pay up - but only to the company who IS named as the owner/keeper on the V5 at the time.
3) Legal issues: If you find yourself in a situation where you are asked to produce your vehicle documentation, you will not be able to - this can occur in the UK or abroad.
4) Parking: If you reside in an area where your local authority has to issue parking permits, the tight controls around these often require you to produce the V5 bearing your name and address to prove you are eligible to apply for a permit for that road.
..and remember...a car’s warranty starts ticking from the day it was first registered, so if you buy the car a few months after it was originally registered, despite it only having delivery mileage...you’ll have lost that length of time on its warranty - so factor that into your calculations to decide if it is still a ‘bargain’!
What can you do?
Don’t let a ‘too good to be true’ price sway your common sense and decision, a car is that price as there are risks and ownership issues, and unknowns, from operators in the car market stopping it becoming transparent, safe and risk-free for the consumer. Many of these operators are ‘bedroom brokers’, operating on laptops and without even bricks and mortar businesses premises. You wouldn’t buy any other goods from an outfit like that, so don’t do it with something expensive like a new car either.
If you are told that you will not get the logbook for some months, you must insist that the deal has to include immediate logbook transferral to your name. if they cannot do it, simply walk away and buy from the small number of brokers who DO enable you to have the benefit of high-volume discounts but act merely as introducers, enabling you to transact safely with a main franchised dealer and enjoy a normal ‘first registered owner’ sale...like DealDrivers!.
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