Know your rights when it comes to buying a used car.

by Julia Petratos

There are a lot of considerations that come into play when you’re purchasing a car, and it’s important to also consider your possible protections and entitlements if you end up with a lemon. These protections and entitlements vary depending on whether you have purchased a used car from a dealership or from a private seller.

Purchasing from a Dealership

When you purchase a used car from a dealership, you receive the benefit of a cooling-off period, together with the guarantee of a clear title on the car. You’re entitled to a statutory warranty as a guarantee that the vehicle is free from defects (if the car is within the warranty conditions) and to cover any repairs for possible defects. You also have access to a claim fund in the event that you suffer any financial loss as a result of damage caused by the dealership’s actions.

If you have a dispute with the dealership regarding a consumer guarantee, you are also generally entitled to make a QCAT application, or you could make a complaint with the Office of Fair Trading.

These advantages and protections come with an increased price tag and if you’re looking to spend a bit less on a car, you could look on the private market. Be warned though, the lower prices do carry some risk.

Purchasing from a Private Seller

When you purchase a used car privately, you’re usually getting the benefit of a cheaper price, an easier transaction without dozens of forms to fill out, and you don’t need to get locked into a contract. However, purchasing a used car privately means you’re missing out on a range of protections and can sometimes put you at risk.

Private sellers aren’t obligated to inform you of every single problem with the car, and if you aren’t vigilant in having the car inspected by a qualified mechanic before purchasing, there is a possibility that you could end up with a car that is in worse condition than you were led to believe.

Buying from a private seller means you are not entitled to the same protections that you would typically get from purchasing from a dealership – protections such as a cooling-off period, a warranty or a certificate from the Personal Property Securities Register (PPSR). You’re also not entitled to make a QCAT Application in the event that the car is not in good condition.

If you plan on purchasing a car privately, we recommend that you take the following steps:

  1. Check the registration and VIN number of the car to ensure that it has not been stolen;
  2. If the car is being sold as registered, ensure you have received a current safety certificate;
  3. Request a PPSR certificate to make sure no money is owing on the car;
  4. Check that the details on the registration certificate match the registered owner’s name, the number plate, the VIN number and the engine number;
  5. Have the car inspected by an expert;
  6. Test drive the car yourself;
  7. Have a contract written up outlining the details of the purchase, all defects in the car that have been disclosed by the seller, the purchase price, the date of the purchase and the names and signatures of the seller and purchaser; and
  8. Do not pay any money until you have completed these steps.

If the seller refuses to facilitate any of the above steps, that is a red flag that something isn’t right with the car. You should proceed with caution.

If you run into difficulties after purchasing a car, call us to book an appointment with one of our lawyers to discuss your options.