We all know the risks involved with buying a used car. You could end up overpaying for a lemon or there may be cosmetic fixes covering up major mechanical problems. However, there are plenty of great bargains out there and picking the right one could mean finding a diamond in the rough that will save you tens of thousands of dollars over buying a new car.
If you’re looking at buying a used car, check out this list of tips to help avoid the duds and find a car that suits your lifestyle and your wallet.
- Work out what you want and need from a car
When shopping for a car, too many people think about what they want instead of what they need. Sure, you may want that V8 Toyota Landcruiser, but do you really need it?
Have a think about your lifestyle and work out what kind of car will suit you practically. If you live in the country and do a lot of towing, then maybe that Landcruiser is the right choice for you. However, if you live in the city where space is at a premium, then maybe you’d be better off with a smaller, more fuel efficient hatchback. You could also think about what factors would make you sell your car. Do you need more space, greater towing capacity, better fuel efficiency? Any of these factors could be a good indicator for what you actually need in a car.
Make a realistic list of wants and needs. Your needs may be things like a certain number of seats, boot space, fuel efficiency, reliability or towing capacity, depending on lifestyle, work and family requirements. Your wants are the “nice to haves” such as a prestige brand, high performance, a particular colour or body kit and so on.
Working out what you need can help you to make a vehicle shortlist to easily narrow down your choices and discount all those models that don’t meet your list of essential criteria.
- What’s your budget?
Before you start shopping, it’s essential to work out exactly what your budget is. Your available budget should include how much ready cash you have on hand, what kind of loan approval you can get and the potential trade in value of your existing vehicle (if you have one).
Once you’ve worked out exactly how much money you have to spend, it’s worth looking for vehicles priced a little below your budget point. This will give you room to negotiate while also leaving yourself room to cover additional costs like registration, stamp duty, insurance, pre-purchase inspections and any other expenses that may not be included in the sticker price.
- Dealer or private seller
There are two main avenues for buying a used car. You can buy from a dealer or from a private seller through online sites like Carsales.com. There are pros and cons to each. You are more likely to get a better price buying from a private seller, but the vehicle will come with no warranty or after sales service. A used car dealer, on the other hand, will usually provide after-sales support and service, plus they have their reputation to consider so they have a vested interest in not selling a dud. Additionally, dealers can offer more flexible payment options, whereas private sellers require immediate payment in full. There are inherent risks associated with buying any used car, so it’s worth having a think about whether you’d rather deal with a dealer or private seller.
- Do your research
Before you start test driving a bunch of cars, do some research into the models you’re interested in. Do a deep dive into factors like reliability, fuel efficiency, running costs, safety and resale value. Check out as many reviews as possible. Try to talk to people who own or have owned the models you’re looking at to see what their experiences have been. As you do your research, you can start crossing various models off your shortlist if they don’t measure up.
Once you’re looking at specific vehicles, it’s worth looking up the car on the government-run Personal Property Securities Register. Based on the vehicle’s VIN number, this site will provide you with a complete vehicle history report that includes whether the car has been written off, stolen, in an accident or has any finance owing.
- Know what to look for
Before test driving any used car, you should take the time to inspect it. There are several things you should look for, and you don’t have to be a professional mechanic to spot them. Look for any signs of fluid leaks under the bonnet and under the car before and after a test drive. Any coolant, oil or water leaks could be signs of poor maintenance and could indicate that major repairs are necessary.
Look for uneven wear to the tyres as well as any signs that the vehicle has been in an accident. Most reputable dealers won’t sell accident vehicles, so you should be extra careful checking private seller vehicles.
You should always ask to see the vehicle’s service history. A well maintained car should have a fully documented service history that outlines exactly what repairs and maintenance has been carried out on the vehicle. If the seller can’t or won’t provide you with a service history, be suspicious.
Checking the odometer is important, but kilometres don’t tell the whole story. A car with 100,000km that has been meticulously maintained and has a full service history may be a better purchase than a car with 80,000km and no service documentation.
One of the final steps you should take before buying a used car is getting a pre-purchase inspection from a reliable and independent mechanic. They will be able to verify the condition of the vehicle and point out immediate or upcoming repairs that need to be taken care of.
- Cheaper isn’t always better
While you may be able to nail a bargain, in general cheaper used cars will tend to be less reliable and require more repairs and maintenance. If you’re looking at a particular model and you find one for sale that is significantly cheaper than others you’ve seen, you may have found a lemon, not a bargain. Sometimes it’s worth paying that little bit extra up front to avoid major repair costs down the road.