Looking for a set of wheels that are more reliable than what you have – or perhaps upsizing or downsizing? Buying new car can be a shock to the hip pocket, especially if you’re on a strict budget. Keep in mind that a new car loses 20% of its value once you drive it home!
If you are looking for a second-hand car in Australia, you do have to perform a little more legwork to get a good deal – and ensure you aren’t scammed, either. So here are some tips and tricks to get a great deal on a second-hand car.
Used vs certified used
There are two types of used car in Australia – used cars sold “as is” by private sellers or dealers, or certified used cars which are refurbished by dealers.
Certified used cars are a maximum of three years old and are given a mechanical and exterior once over by the manufacturer. It also comes with an extended warranty.
Of course, you are paying for all this with higher prices. But what price is your peace of mind?
Looking at car loans and financing
Used cars, no matter which variant you choose, will likely need to be purchased with some kind of finance. Before researching different options, you need to meet a lender or broker’s eligibility criteria. Learn if you’re eligible for a car loan first.
Your borrowing power will be determined by your credit score, level of income, and how much left over you have to support the loan. Note that used car finance may attract higher than usual interest rates compared with new cars due to a higher risk profile.
Though relatively new (1-5 years old) cars are still considered on the “new” side.
How to research and test drive
You should research your used car by looking at reviews, forums, and social media; especially for the make, model, and level of wear your car may have.
You need to inspect a car’s VIN (vehicle identification number) and run it on the Personal Property Security Register to ensure it’s not stolen or written-off. You need to inspect the car for exterior paint damage or chipping, and if the engine is working properly and in good condition.
Lights and electricals should all be in working order. At the very least, your seller should be able to produce a Roadworthy Certificate (RWC) when asked. If they can’t answer basic questions or reluctant to hand over documents like the logbook, walk away. Here is a handy checklist to use when checking out a used car.
Look out for common scams
Scammers are rife in online car markets, and some will send unsolicited messages offering too-good-to-be-true deals.
One common scam is where someone in the “military” is ordered on “immediate deployment” and will sell you a near-new car for a bargain price – but you have to pay them for “delivery” first. If you can’t see the car first, don’t trust these offers. Always meet a seller in a public place or at their home during daylight hours.
If possible, bring a friend along and take photos or vision of the car for added security. By following a few checklists and precautions, you can save yourself a lot of trouble!
Article Last Updated: November 30, 2023.