Guide To Buying A Used Car

Are you thinking of buying a used car? As an excellent way to save money, used car sales are more popular than ever. Whether you need a commuter car or run around, used is an excellent alternative to buying new.

Read on for our step-by-step guide to used car shopping to start on the right foot:

Preparing to buy a used car

Before you even think about handing over cash for a car, you'll want to do some prep work upfront. Rushing to buy can lead to buying an unsuitable car, out of budget, or a complete lemon. So, sit down, take your time, and think about the following before you agree to anything…

Know your budget

If you know exactly how much you have available to spend, it's easier to find cars in your price bracket. Your budget doesn't account for the lump sum of the vehicle itself. You'll also need to cover petrol, taxes, and servicing costs on top.

Know what you’re looking for

It may sound like common sense but going in blind is the worst thing you can do. If you’re looking for a family hatchback, you don’t want to end up with a sporty number. If you know the type of car that’s best, you’ll be able to find the perfect car for your needs.

Have a checklist ready

Having everything written down in front of you is key to success. When used car shopping, having a list of what you're looking for, things to ask, and more can be a huge help.

Do your research

Research can help make the buying process easier. Here are a few of the things you should know before getting out there:

  • Environmental rating
  • State regulations
  • Fees you’ll need to pay
  • Car safety rating
  • Insurance costs
  • Car security

Where can I buy a used car?

Dealers

Dealers are a popular choice for used car sales. This is partly because you're dealing with a professional. Which many people consider the 'safer option'. While dealers aren't best in every circumstance and may cost more, there are some benefits:

  • In certain states, dealers must provide a warranty. This is to cover certain car failures or problems
  • Cars must have no debt before being sold via a dealer
  • You may be able to access financing through dealer partnerships
  • You could trade in your old car
  • More likely to have full vehicle details online for research

Auction

Auctions are another popular option for used car buyers. But if you’re a beginner, you may feel out of your depth in the average car auction. The benefits of going via auction include:

  • The chance to get a great deal on a used car
  • Potential for warranty depending on state requirements
  • No one else can look at the car either – so you might get an excellent vehicle at a lower cost

Private

Private sales of vehicles are still a popular option across Australia. While you need to rely on the trustworthiness of the other person, private sales happen every day. Benefits of private sale might include:

  • Lower cost in comparison to dealers
  • You can set your terms – including checks, test drives, and more
  • Huge variety of options available to pick from

Questions to ask when buying a used car

Can I inspect the car?

If the answer is 'no,' that's a red flag waving over your potential car deal. You should have the chance to check private or dealer vehicles then and there. This is not the case with most auction cars.

Can I see your paperwork?

It's vital to see paperwork for private car sales. If the seller can't provide paperwork, that's another big red flag. If they can’t offer documentation, this may mean they don’t own the car.

Why are you selling this car?

While you may not get a clear answer, there’s no harm in asking. You can find out more about the vehicle that wasn't included in its description in some cases.

Has this car been in an accident or collision?

A car may look perfect on the outside, but that doesn’t mean there’s no damage underneath the hood. Cars that have been in accidents can be a problem and will need careful checks.

What’s the mileage?

Mileage and past owners can help you understand a car's history. The higher the mileage, the less reliable the vehicle in some cases. You can also check mileage against servicing for extra safety.

Can I take a test drive?

If a dealer or private owner isn’t willing to let you try a car out, that’s another red flag waving. If you can’t take a car out for a spin, it may be that something else is wrong that the seller hasn’t informed you of.

Buyer rights and regulations for used cars

ACT

  • Three-month warranty or 5,000km coverage.
  • Warranty applies to cars under 10 years with less than 160,000km.
  • 3-day cooling-off period, with 1% of the purchase or $100 charged on cancellation.

Northern Territory

  • Three-month warranty or 5,000km coverage.
  • Warranty applies to cars under 10 years with less than 160,000km.
  • No cooling-off period.

NSW

  • Three-month warranty or 5,000km coverage.
  • Warranty applies to cars under 10 years with less than 160,000km.
  • 3-day cooling-off period, with 2% of the purchase or $250 charged on cancellation.

Queensland

  • Three-month warranty or 5,000km coverage.
  • Warranty applies to cars under 10 years with less than 160,000km.
  • Separate one-month warranty or 1,000km coverage for vehicles above this limit.
  • 3-day cooling-off period, $100 charged on cancellation.

South Australia

  • Two-month warranty or 3,000km coverage.
  • Warranty applies to cars with $3,0001-6,000 value.
  • Separate three-month warranty or 5,000km coverage for vehicles above $6,000.
  • 2-day cooling-off period, with 2% of the purchase or $100 charged on cancellation.

Tasmania

  • Cars less than seven years old and less than 120,000km on the clock include a three-month or 3,000km warranty from dealers. There is no applicable cooling-off period.
  • No cooling-off period.

Victoria

  • Three-month warranty or 5,000km coverage.
  • Warranty applies to cars under 10 years with less than 160,000km.
  • 3-day cooling-off period, with 1% of the purchase or $100 charged on cancellation.

Western Australia

  • Three-month warranty or 5,000km coverage.
  • Warranty applies to cars under 10 years with less than 150,000km.
  • Separate one-month warranty 1,500km coverage for vehicles between 10-12 years with 150-180km.
  • No cooling-off period

Inspecting a used car

Inside & under the hood

  • Examine trim, carpets and upholstery
  • Check the seatbelts
  • Try all equipment and accessories, including wipers, windows and air conditioning
  • Look for signs of rust or damage
  • Check the oil dipstick
  • Remove the radiator cap to see if the coolant is clean
  • Check the fans and batteries for corrosion or damage
  • Start the engine and check for fumes, noise and rattling

Outside

  • Look for bubbling paint and rust
  • Examine the paint for discolouration and filler
  • Check the tyres and wheels
  • Examine the panels and doors
  • Check for leaks of oil or coolant on the floor

On paper

  • Check the ownership of the vehicle
  • Look for the compliance plate between the engine and interior
  • Confirm the VIN, engine number and plates online
  • Ask for proof of servicing and a certificate of roadworthiness

On the road

  • Listen for rattling or banging noises
  • Test smoothness of gears and brakes
  • Check if car suspension pulls to one side or other on straight roads
  • Keep an eye out for warning lights or messages
  • Test the car on flat, winding and hilly surface for performance

Purchasing your used car

Once you’ve decided to buy a used car, the next step is completing the buying process. Here’s what you’ll need to remember to do:

Payment

If you're paying a dealership, they will likely have formal payment methods in place. This may include finance, as well as standard payment methods like a bank transfer. Auctions will also use card payment or bank transfer. Cheques or bank transfers are normal for private selling.

Paperwork

You should always inspect and check paperwork before you buy a used car. Once you’ve completed the sale, you’ll want a receipt. You should also complete the handover of all car paperwork ready for registration.

Tax and insurance

If you're planning to drive away, tax and insurance should be arranged ahead of time. Ensure your insurance is set up for your vehicle on the day of pickup, or you may not be able to drive it home. Once your tax is in place and you're driving away, you've completed your used car purchase.

For more tips and advice on buying a used car, check out our Car Buyers Guide.