Buying a car is exciting, but the search can be confusing at times and you can get caught out with a lemon.
Here are some things to consider when buying a used car;
If you already know which car you want to buy, you will know how much car finance you need. If you don’t know which car you want to buy, a good starting point is to work out how much you can afford to borrow.
Try using our car loan calculator to work out how much you can afford to borrow on your car loan overall, and how much you can afford to pay back each month.
Remember that purchase price is just the start though, as there are ongoing running costs like fuel, maintenance, insurance, plus the interest on any finance used for the purchase to consider.
2. Car Loans
What kind of car loans are available? Most car loans are secured against the car you buy. That means your car is the collateral for your loan. Secured car loans can be cheaper than unsecured options, but it really depend on what works best for you, and what you need.
A car loan – also known as car finance – can help you buy a car when you can’t afford to pay for it outright. When you take out car finance, you agree to borrow a certain amount from a lender, and then repay it over a certain period of time, usually with interest. Car loan interest rates vary, so it’s important to compare car loans before making your decision.
Lend Me can help you with a variety of car or auto loans, for example;
- Secured Car Loan
- Personal Loan for a car
- Novated Lease
- Chattel Mortgage
- Mortgage Refinance or Redraw
If you need help deciding between car loans, Lend Me advisors can give you the pros and cons of each choice. And remember Lend Me can help with all types of Auto Loans. A motorbike loan, boat loan, jet ski loan or even a ride on mower loan? If it has an engine… we can help.
There are many websites that can help you get an idea of what vehicles are available within your budget. Some examples are;
You might even consider a car location service like Locate Me who will find, inspect and negotiate on your behalf. This saves you not only time, but also potential headaches. The cost is a small amount for peace of mind. See Locate Me.
Be careful of cars that seem too good to be true, they could have been in an accident, have mechanical problems or simply be too good to be true!
4. Contacting the Seller
Write a list of questions before you call the seller so you don’t forget anything.
- Has the car had more than one owner?
- How long have they owned the car?
- What is their reason for selling it?
- Has the vehicle ever been damaged?
- What condition is the car in, and is there any issues not show in the photos?
- How detailed is the car’s service history and is it with the car?
- What arrangements can be made for an inspection and test drive?
- Is the car insured for other drivers (for the test drive)?
- Other details that might be missed on the ad
On your inspection make sure to check out the exterior, interior and engine of a car.
Take your time during the inspection, don’t feel rushed while inspecting and walk away if the seller objects to your inspection. If possible try to get a mechanic to assess checklist results.
Make sure you take a notepad to take down any flaws and use them when negotiating against the asking price.
Don’t inspect at night or in the rain, this will hide defects.
A complete buying checklist to use on a specific car.
- Number plates attached to the vehicle
- Windshield free of cracks
- Windshields wipers and blades fully functional
- Headlights and directional lights intact and fully functional
- Body panel colours match
- Can you see rust on the doors, doorsills, body or boot? Lift the floor and body mats too as corrosion here is expensive or impossible to repair.
- Fresh paint job (is it to conceal rust?)
- Does the car’s paintwork show ripples when viewed against the light? It may have been in an accident.
- Body scratches noted
- Body dents noted
- Boot and hood close and are properly aligned
- Doors and fender seams meet and are properly aligned
- Are a reputable brand name (Michelin, Bridgestone, Goodyear)
- Are they all of the same make
- Free of any cuts, bubbles or cracks
- Tread worn evenly (uneven wear shows alignment and suspension problems)
- Spare tire, jack and lug wrench on car and fully functional
- Spare tire inflated
- Free of fluid or oil leaks
- Oil filler neck not coated with thick, black deposits
- Battery terminals free of corrosion
- Oil dip stick free of dark, black oil
- Free of odors while engine is running
- Exhaust pipe emissions are neither blue (indicates engine burns oil) or
black (indicate excessive oil consumption)
- Vehicle rests levelly
- When bouncing the vehicle’s corners, no creaking noises are made
- All corners respond the same when bouncing
- Chassis is neither bent nor cracked
- No signs of crumpling or straightening inside the trunk
- Frame holes just inside outer edge clean and free of scratches
F. Automatic Transmission
- Transmission fluid looks clean, not dirty or gritty (no indicates possible
internal transmission problem)
- Transmission neither slips nor delays when driving
G. Manual or Standard Transmission
- Each gear shifts smoothly
- No grinding noises when in reverse
- Vehicle steers straight and does not pull to one side when applying brakes
- Parking brake engages and disengages freely
- No grinding noises when applying
- Wheels do not lock when applying antilock brakes (if applicable)
- Vehicle does not drift to one side without prodding
- Vehicle is stable; no shaking or vibrating
- No resistance in the steering wheel when turning
- No clicking or clunking when turning
- Seats unworn and free of cracks
- All doors open and close freely
- Do the locking facilities work?
- Trunk opens and closes freely
- Lacks a heavy scent of air freshener (may indicate something is being concealed)
- All gauges work
- No dashboard warning lights remain illuminated
- Stereo works
- Heater works
- Air conditioner works
- Windshield wipers work
- Windshield wiper fluid dispenses properly
- All seats equipped with functional seat belts
- All seats adjust properly
- Do the windows wind all the way up and down?
- Power windows operate properly
- Sunroof opens and closes properly (if applicable)
- Car alarm works (if applicable)
- Trunk and driver-side door lock and unlock with key
- Hazard lights function properly
- Headlights, including high and low beam, work properly
- Service and repair history records available, including information about accident repairs
- Car manual located in the glove compartment
- Instructions included for any accessories
- Owner has title
6. Test Drive
- Is there smoke coming from the exhaust?
- Can you hear any strange noises?
- Are there pools of water or oil under the car after running it?
- Can you hear any clunking or rattling noises over rough surfaces? It may mean a worn suspension.
- If the car doesn’t have power steering, how is its free play?
- Does the steering feel loose?
- Does the steering wander?
- Is there any vibration through the steering wheel?
- Can you hear knocking sounds when you drive the car? This could mean wear in the wheel bearings, king pins or other suspension parts.
- Is there any grabbing or pulling to one side when you brake?
- Do an emergency stop to test the brakes. Does the car veer or stop too slowly?
Gears and clutch
- Do the gears engage smoothly as desired?
- Do you have to force the car to first gear or reverse? There could be serious problems.
- Does it shudder when you stop and start on a hill? It could mean clutch or gear box problems.
- Do the gears slip, as this is a sign of bad wear?
- Does it make whining noises when you change into lower gear? The gearbox could be worn.
- Does the clutch take up gradually and smoothly, as it should?
7. The Car’s History / Background Check
If buying privately you are not guaranteed clear title, therefore it is highly recommended that you check;
- that the vehicle is not reported as being stolen
- if any financial institution, enforcement agency or individual has a registered security interest over the vehicle. In other words make sure that the used car is debt free and that any finance owed on the car has been completely paid off.; and
- any written-off vehicle damage reported for the vehicle.
You can obtain this information from Register of Encumbered Vehicles (REVs) in Western Australia. http://www.revs.com.au/
In order to get this information, you will need:
- the vehicle’s registration number,
- state of registration,
- vehicle identification number (VIN) or chassis number, and
- engine number.
8. Price Negotiation
Consider bargaining down from the seller’s asking price if you think the price is not fair.
Refer back to your list of faults discovered during the inspection, and negotiate based on the cost of fixing these problems.
Also consider the price of comparable vehicles you have found during your research. Suggest a reasonable figure to offer the seller. They will either accept, decline, or suggest a price closer to the asking figure. Work through this process until both parties agree.
9. Contract & Payment
Make sure of the following;
- registration paperwork is in order,
- both sections of the Transfer of Vehicle Registration Application have been completed and signed by both the person selling the vehicle and the person buying the vehicle,
- service history is available,
- details match the seller, and
- original versions of everything are provided – never photocopies.
When making a payment including a deposit, get a receipt and make sure the seller’s full details are on it. Most, if not all state registration papers will include a receipt for this purpose.