Buying a car
We all want to pay a fair price for a car that’s going to last. We have plenty of information to help you buy a car.
Before you start looking
Some steps to take before you start looking at cars:
- Ask yourself what kind of car you need.
- Ask yourself what you can afford.
- Shop around for the best deal.
- If you think you need a loan, look for the best one to suit your budget.
Don't forget
Buying a car is a big decision. Always remember:
- You have the right to say no.
- Don’t sign on-the-spot loan contracts (at car yards) without shopping around or understanding what you are signing.
Buying from a car dealer
If you’re buying from a dealer, make sure they have a licence to sell used cars. Anybody who sells used cars as their job needs to have a licence.
A car dealer will have to give you a few extra options you don’t get when you buy privately from a friend or a neighbour.
When you buy a used car, you have until the next day to change your mind. If the dealer isn’t open that day, you get until the next day they are open. This option doesn’t count if you drive the car away with you on the day you buy it (but a test drive will be okay).
Statutory warranties
Licensed motor dealers must automatically give you a warranty at no extra cost when you buy a used car from them. We call this a statutory warranty. It protects you from losing money if your car is faulty.
There are 2 types of statutory warranty: ‘class A’ and ‘class B’.
A class A warranty covers you if the car is under 10 years old and has been driven less than 160,000km on the day of its sale. The warranty runs out after 3 months or the first 5,000km driven after you buy the car, whichever happens first.
A class B warranty covers you if the car is over 10 years old and has been driven 160,000km or more on the day of its sale. The warranty runs out after 1 month or the first 1,000km driven after you buy the car, whichever happens first.
Consumer guarantees
For older vehicles, you still have rights called consumer guarantees. These are promises from the dealer that:
- the car has to work properly
- it has to be safe when it works
- nobody will try to take the car back (unless you fall behind on your car loan)
- it should not break down or fall apart too quickly (this will last longer for a newer, more expensive car).
A dealer must give you a consumer guarantee, even if it’s a new car.
Some simple things to check
Before you sign anything, you should make sure that the car is worth paying good money for. We can help you do a few simple checks on the car you’re looking at.
These checks will ask:
- Does the car have any money owing on it?
- Does the car have any water damage?
- Is the car in good enough condition to pass the registration?
Before you sign any contract
You should never buy a car without seeing it first.
Make sure you take a few important steps so that you don’t end up with something dodgy.
- Check that the car is registered.
- Check that the car has a safety certificate.
- Get a mechanic or RACQ to check the car for problems.
- Search the Personal Property Securities Register to make sure it isn’t stolen or under a debt.
- Take the car for a test drive and make sure it’s all okay.
- Read the whole contract. Ask questions if you don’t understand what something means.
After you sign the contract
Don’t forget to do these 2 things after signing the contract:
- Get a copy of the registration and contract and keep them safe.
- Get the car registered under your name.
Don’t take the risk!
Check it’s registered and safe. Don’t pay more than it’s worth.
Darrell got a $5,000 loan to buy his first car from a car dealer, Johnno. Darrell couldn’t wait to go cruising with his mates. Darrell bought the first car Johnno offered because he knew Johnno only came to town twice a year. A month later, Darrell’s car broke down on the side of the road. He couldn’t fix it and it was too far to tow the car home, so he left it there. Darrell had bought an un-roadworthy car from an unlicensed dealer, but he still had to pay off his $5,000 loan.