Advice on a new car trader
Discussion
Hi, I am currently looking at becoming a car trader.
I have worked on cars for many years & in college coming out with a qualification.
I am slightly confused with what you need, thats where hopefully some people on here can help me out.
- Do I NEED Motor Trade Insurance (If so, is there any way around it with temporary insurance? Been quotes £5000 for the insurance. (20 Years Old)
- Do trade plates cover for test drives? As the cars will be stored at home in a garage, so I am wondering if the Trade Plates would cover that, or would you need insurance also
These are the only queries I have, if you could give me some advice on this that would be great.
Thank you - Owen
I have worked on cars for many years & in college coming out with a qualification.
I am slightly confused with what you need, thats where hopefully some people on here can help me out.
- Do I NEED Motor Trade Insurance (If so, is there any way around it with temporary insurance? Been quotes £5000 for the insurance. (20 Years Old)
- Do trade plates cover for test drives? As the cars will be stored at home in a garage, so I am wondering if the Trade Plates would cover that, or would you need insurance also
These are the only queries I have, if you could give me some advice on this that would be great.
Thank you - Owen
Hi, trade plates are for a single purpose only, which is allowing you to drive a car which does not have road tax on the road legally. All other road laws must be adhered to so car must still be MOT’d, insured etc.
Essentially yes, you do need motor trade insurance as it will insure you to collect vehicles you have bought and (assuming you arrange the necessary level of cover) allow your customers to be insured when test driving the cars.
Good luck, it can be an emotional rollercoaster of a job but very rewarding if you are cut out for it.
Essentially yes, you do need motor trade insurance as it will insure you to collect vehicles you have bought and (assuming you arrange the necessary level of cover) allow your customers to be insured when test driving the cars.
Good luck, it can be an emotional rollercoaster of a job but very rewarding if you are cut out for it.
I guess that depends on how many cars you are likely to sell as it could add up to a fortune and if, in the event of a claim, insurers got wind of the fact the car was being driven for purposes of a business transaction, would they have issue with that (I don’t know).
A good way to start out is to look for a ‘Road Risk’ policy as these are designed for home trader type customers (which it sounds like you will be). It will still be expensive but ideally you want to start building a motor trade insurance history to gain lower premiums in the future.
A good way to start out is to look for a ‘Road Risk’ policy as these are designed for home trader type customers (which it sounds like you will be). It will still be expensive but ideally you want to start building a motor trade insurance history to gain lower premiums in the future.
If you are contemplating getting involved in the motor trade - don't.....
I believe trade plates will only be issued to an "established" motor trade business and will involve considerable liaison with the local authority/DVLA.
"Motor Trade" insurance will be, and correctly so, VERY expensive. Think about it. You are asking an insurance company to cover you to drive ANY vehicle. (There may be certain limitations, such as engine size and value of vehicle). At your age, and implied VERY limited experience of driving, any insurance is either going to refuse you motor trade insurance, or load it so high that it will be uneconomical for you to even consider it. (Area of £5000+ a year).
Personally, I would not recommend anyone entering the motor trade, in any way, shape, or form. It is full of legislation, many, many crooks, Jo Public has so much of the law on their side, and unless you have access to lots and lots of cash, (meaning you don't have to bury yourself in a load of borrowed credit), stay well away from the motor trade.
50 years of experience has taught me all of the above, and I now wish, at nearly 70, that I'd never got involved in it.
Property is a FAR better trade to get into - they stand still and they haven't got wheels......
I believe trade plates will only be issued to an "established" motor trade business and will involve considerable liaison with the local authority/DVLA.
"Motor Trade" insurance will be, and correctly so, VERY expensive. Think about it. You are asking an insurance company to cover you to drive ANY vehicle. (There may be certain limitations, such as engine size and value of vehicle). At your age, and implied VERY limited experience of driving, any insurance is either going to refuse you motor trade insurance, or load it so high that it will be uneconomical for you to even consider it. (Area of £5000+ a year).
Personally, I would not recommend anyone entering the motor trade, in any way, shape, or form. It is full of legislation, many, many crooks, Jo Public has so much of the law on their side, and unless you have access to lots and lots of cash, (meaning you don't have to bury yourself in a load of borrowed credit), stay well away from the motor trade.
50 years of experience has taught me all of the above, and I now wish, at nearly 70, that I'd never got involved in it.
Property is a FAR better trade to get into - they stand still and they haven't got wheels......
What is your business model, is this something you intend to provide your full income? I would suggest if £5k as an overhead is already too much, you are already a bit out of your depth financially, how much capital are you putting in?
As above, the CRA 2015 covers people very nicely when buying from a car dealer (which it sounds like what you are wanting to do), what if you buy a car, sell it on, then buy another car with your available cash (how many parking spaces in your garage?) then the customer comes back and under the terms of 30 day right to return bring the first car back and demands their money - do you have the financial ability to cover that potential business outcome? Can you then store the two cars? Can you pay the customer back?
Sorry to sound rather negative, but do look at all the outcomes, as someone said above the law is really on the side of the consumer now and car traders are on the hook for a lot more than they used to be.
As above, the CRA 2015 covers people very nicely when buying from a car dealer (which it sounds like what you are wanting to do), what if you buy a car, sell it on, then buy another car with your available cash (how many parking spaces in your garage?) then the customer comes back and under the terms of 30 day right to return bring the first car back and demands their money - do you have the financial ability to cover that potential business outcome? Can you then store the two cars? Can you pay the customer back?
Sorry to sound rather negative, but do look at all the outcomes, as someone said above the law is really on the side of the consumer now and car traders are on the hook for a lot more than they used to be.
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