Buying a used car

Used car
  • Buying a well maintained used car can save you a lot compared with buying new
  • Buying privately can also deliver savings compared with buying from a dealer, however;
  • Buying from a dealer means you get a warranty in many cases
  • Follow the used car inspection checklist from the NRMA to help avoid buying a lemon
  • Use the online CarHistory check to make sure the car doesn’t have money owing on it, or has been in a serious crash in its past

When buying a used car, whether from a dealer, privately or at auction, it’s important to conduct a thorough mechanical inspection and do checks to ascertain whether the car has money owing on it, or has been involved in a major accident.

Buying a used car from a dealer

Buying a used car from a dealership gives you guaranteed title and a statutory warranty on cars under 10 years old or 160,000km (and below the NSW luxury car tax threshold.) This warranty is valid for three months or 5,000km from date of purchase and covers items relating to safety, reliability and roadworthiness.

A dealer will usually be able to arrange finance for your purchase, although it’s worth shopping around. A used car loan from the NRMA will offer competitive rates and Member benefits.

Dealers

 Advantages Disadvantages 
 Provide a range of used vehicles to choose from   Generally, you pay more at a dealer, though you will usually get a statutory used car warranty
 Easier to dispose of your vehicle   A trade-in will probably not achieve the best price for your old car 
 Licence dealers guarantee title of the vehicle   
 Warranty in NSW on cars under 10 years or 160,000km and below the Luxury Tax Threshold in NSW   

Buying a used car privately

Choosing to buy privately usually means you will get a better deal compared with shopping at a dealership and you may also get an idea of the car’s history directly from the owner. Even if you get the car’s log books, make sure you check NRMA’s Car History report online.

 Advantages   Disadvantages
 Might be cheaper  No warranty
 Uou may get to meet the previous owner and can obtain the vehicle's history   Any faults found are not covered by Fair Trading*

*As the title of the vehicle is not guaranteed, any faults found are not covered by Fair Trading. You'll probably get a cheaper car, but you're not guaranteed a clear title, and you've got no legal backup. A worthwhile check is to cross reference the registration certificate with the owner’s driver’s licence.

Buying a used car at an auction

You may save money at an auction, but you must do your homework. Set a price and don't go over it. Ex-government and fleet cars are often good value and have usually been regularly maintained but they might not have been driven as carefully as privately owned cars.

 Advantages  Disadvantages
 May be cheaper   May not have any warranty
 Guarantee of title  Can't test drive
 Various makes and models in one location   Usually you're required to pay a deposit of around 10% or $500
 May carry out an independent vehicle inspection the day prior to the auction  May not be able to have the car inspected on the day of the auction
 If there’s low competition, you may be able to buy the car close to reserve price    Can get carried away and pay a higher price during the bidding process

NRMA used car inspection checklist

  • Body and paint – Inspect the body for dents, ripples or creases, loose, misaligned or mismatched panels, paint overspray, evidence of rust or crash repairs, and hail damage. Check that the doors, boot or tailgate close easily and latch firmly.

  • Interior – Check the seats, carpet and interior plastics for stains, damage, cracks or wear and tear that’s not consistent with the age and kilometres of the car.
  • Vehicle identification – Check that the car’s VIN – vehicle identification number – matches the VIN on the registration papers. You’ll find the VIN on a small silver build plate that’s usually in one of the rear corners of the engine compartment, or at the base of the windscreen. While you’re there, also confirm the car’s build and compliance dates.
  • Engine oil – A stamped service book will tell you if a car has been serviced at regular intervals. Checking that the dipstick shows a full supply of clean, honey coloured (not black) oil will provide extra confirmation.
  • Engine – Ensure the engine runs smoothly and quietly at idle and while driving.
  • Radiator coolant – Only remove the radiator coolant cap when the engine is cold; the coolant should be clean and brightly coloured, typically green or red.
  • Tyres – Ensure all the tyres (including the spare) are in good visual condition without signs of damage or uneven wear, and with tread depth above the minimum wear indicators. Ideally, the tyres should be of the same brand and pattern.
  • Fluid leaks – Look around the engine compartment and underneath the car for signs of oil, coolant or other leaks that might indicate poor maintenance and potential repairs.
  • Exhaust – Black, blue or white smoke from the exhaust indicates an engine problem. Excessive exhaust noise or a knocking sound from under the car can indicate an exhaust system problem.
  • Seat-belts – Ensure the seat belts extend and retract smoothly, that the locking mechanism works, and that the belts are in good condition.
  • Lights – Test the operation of head- and taillights, indicators, park lights, reverse and number plate lights.
  • Warning lights – With the engine running, make sure there are no warning lights illuminated on the instrument panel.
  • Equipment – Check that all the accessories work, including the air-conditioning and fan, power windows and mirrors, audio system, satellite navigation, parking sensors and reversing camera.
  • Jack and tool kit – Make sure these important items are in place and in working condition.

More used car buying advice

Armed with our list and a systematic approach, helps to make sure the used car you’re considering buying is mechanically sound. However, if you’re daunted by the above list make sure you book a car servicing mobile vehicle inspection by the NRMA and leave it to the experts.

An NRMA mobile vehicle inspection is a comprehensive inspection that will identify issues to be rectified by the manufacturer on a used car that’s still under warranty, and can potentially save you thousands of dollars when negotiating a private sale by arming you with a list of bargaining points.

For enquiries and bookings, call NRMA mobile vehicle inspections on 1300 770 116.

The NRMA provides a vast catalogue of new car reviews of current and superseded models, which are invaluable in helping you choose the right used car.

The government’s Green Vehicle Guide provides a trusted source of car fuel consumption and emissions data.

Used-car crash safety information, including car safety ratings, is available on the Australian New Car Assessment Program website.

Buying a used car always carries some risks. If you're concerned you can always reach out to our motoring advice team on 13 11 22.

How do I know if a used car has money owing on it, or if it’s been in an accident?

Simple checks online can tell you whether a used car you’re considering is subject to a financial liability – that is, it has money owing on it – and give you a complete and accurate picture of its ownership and accident history.

The Personal Property Securities Register (PPSR) is an online register of all personal property that has security interests registered against it. Here, as well as finding out if the car you're considering has money owing on it, you can establish whether the car has been written-off as a result of a collision or other damage, or if it has been reported as stolen. For a small fee PPRS will provide a certificate stating the car is unencumbered, which can prevent repossession by a credit provider.

A CarHistory report presents the above information in an instant, easy-to-read format at a cost of $29.50 for NRMA Members (RRP $36.95).

While you’re online, organise a car insurance cover-note with NRMA Insurance to make sure you’re protected while driving your new, second-hand dream car home.

Looking to buy a used car?

NRMA provides car loan options to get you on the road faster