There is absolutely no need for a trader to register a vehicle in his name, when the previous keeper sold it to him, they would have kept the original V5 to send off and the dealer would have been given the red or yellow slip to say it had been sold on to a trader. I would be carefull if the dealer has not got the green slip to give you as the new keeper as you need that part to tax the vehicle when you buy it.
Personally I wouldn't part with a penny without seeing the original V5, you might be buying a stolen or ringed car.