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Car buying guide: Tips for buying a new or used car

Buying your own car can open up a world of possibilities. But starting the car-buying process can sometimes feel overwhelming, especially if you’re a first-time buyer. Do you buy a new or used car? What additional features do you need? Do you need to take out car insurance?

That’s why we’re going to share seven clever tips to help you get on the road to car ownership.

1. Work out your car needs

Before choosing a car model and colour, take a moment to work out what you need from it. Is it just to get you from A to B? Or is driving a big part of your job? Do you need a large boot? Or do you need lots of space for your growing family?

By understanding what you need from a car and what you want out of it, you can narrow down your options significantly. And it can help you work out if you want a new or used car.

You can go online to research different models to find one that meets your needs. Another option is to visit car sales website, like Carsales , Redbook and GoAuto, to see what’s out there.

2. Understand your finances

Understanding your financial situation can help you immensely during the car-buying process, especially in the earlier stages. As a starting point, you can make a budget to assess your finances and work out how much you can put aside. Don’t forget to factor in any upfront and ongoing costs too, like fees associated with a car loan and the registration.

Where you can, ask the seller for a written quote. This can help you understand what you’re actually getting and compare costs to find the most affordable option that suits your lifestyle and driving needs.

Another thing to consider is how you want to pay for your new car. Some buyers might have enough savings to purchase the car outright. But if you don’t, you could take out a secured or unsecured car loan.

3. Get a background check on the car

If you’ve decided to buy a used car, then it’s a smart idea to do a Personal Property Securities Register (PPSR) check. This type of check can tell you if your future car:

  • Still has money owing on it or if it’s leased.
  • Is listed as or considered stolen.
  • Has been written off or was repaired after an accident by an insurer.
  • Has had its odometer tampered with.

You can get a PPSR check through the Australian Government’s vehicle search website for a small fee.

Another thing to think about is getting a roadworthy check done through automotive clubs like RACV or RACQ. This certificate will confirm whether the car is safe to drive on public roads.

4. Look at the car in person

After you’ve found the car you want to buy, it’s time to visit it in person to give it a thorough look over. Remember to check:

  • The Vehicle Identification Number (VIN), registration number and engine number all match the registration papers.
  • If there’s evidence of repairs from a major crash, like an overspray or missing fasteners.
  • The tyres for uneven tread.
  • For rust or any fluid leaks.
  • Faulty break and indicator lights.

If you happen to know a mechanic, you can ask them to come along with you to look at the car’s condition too. They might be able to spot something that you might’ve missed. It’s also common for people to buy a pre-purchase inspection from a certified mechanic for a few hundred dollars, where they inspect and drive the car to provide a comprehensive opinion on any potential issues or work that needs doing.

You can also ask the buyer to take it out for a test drive. When on the road, think about how it feels to drive. Does it steer smoothly? How does it go when you’re stopped on a hill? While driving, listen for anything that sounds unusual, like any odd whirring noises. You can also ask a friend or mechanic to be your passenger to get their opinion on the test drive.

5. Consider when you want to buy

Like with a lot of big purchases, timing is everything, and buying a car is no exception. The end of the financial year and December tend to be quieter months for car dealers. So, if you can be patient, then you can take your time and secure a deal during those periods. And regardless of the time of the year, you can always try to negotiate for a few extras, like a free service or bonus car mats.

6. Check the contract

Carefully checking your contract can help you understand exactly what you’re agreeing to pay for. And it’s a clever way to spot any hidden costs that a seller might not have been upfront about. An add-on here and an extra there can quickly rack up, so work out if you really need the additional features now or if you can get them later.

7. Get car insurance

Taking out car insurance can provide cover for your car, other peoples cars, property and people. There are four different types of car insurance you can take out:

  • Compulsory Third Party (CTP) insurance is required for all registered vehicles. This type of insurance covers the third party – pedestrians, passengers, and drivers of other vehicles – if you cause an accident and they become injured, require ongoing care for an acquired disability or pass away. It’s usually included in the cost of your car registration. Just remember that the rules for CTP insurance change from state to state.
  • Comprehensive Car Insurance is the highest level of coverage your insurer can offer. It covers damage caused to your car and damage your car might cause to other vehicles and property in events that are included in your policy. This level of cover is broader than third-party insurance.
  • Third Party Property Damage only covers your liability for accidental damage your car causes to someone else’s property or vehicle. It doesn’t cover you if there’s damage to your car.
  • Third Party Fire and Theft offers the same cover as Third Party Property Damage, but with the addition of cover in the event of a fire or theft.

Learn more about car buying

Our articles can help you get on the road towards your dream car.

How to get a car loan

If you want to buy a car, then taking out a car loan can make all the difference. Learn everything you need to know about getting a car loan in our article.

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How to refinance a car loan

Did you know that you can refinance your car loan? And that there are some great benefits in doing so? We’re going to explore these and more in our article.

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What is a Green Car Loan?

There are some great options out there to help you buy an electric car. One of these is a green car loan – and we explain what you need to know in our article.

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Important Information

This is general information and does not take into account your objectives, financial situation or needs.

Loans are issued by Great Southern Bank, a business name of Credit Union Australia Ltd ABN 44 087 650 959, AFSL and Australian Credit Licence 238317. Lending criteria, limits, conditions and fees apply.

Rates current as at 9 June 2024 and subject to change.

Your loan contract will state the minimum monthly repayment amount. You can arrange with us to make repayments on a weekly or fortnightly basis.

Great Southern Bank, a business name of Credit Union Australia Ltd ABN 44 087 650 959 AFSL 238317 arranges car insurance as agent for the insurer Allianz Australia Insurance Limited ABN 15 000 122 850 AFSL No 234708 (Allianz). Great Southern Bank does not guarantee or otherwise support this insurance product. Great Southern Bank does not provide any advice based on any consideration of your objectives, financial situation or needs. Terms, conditions, limits, exclusions and underwriting criteria apply. Before making a decision, please consider the Product Disclosure Statement. The relevant Target Market Determination is available here for Comprehensive cover and Third Party Property Damage cover. If you purchase this insurance, Great Southern Bank will receive a commission that is a percentage of the premium. Full details of the commission are set out in the Financial Services Guide. Ask us for more details before we provide you with services.

1. Comparison rate examples are accurate for a personal loan amount of $30,000 secured loan over a term of 5 years. WARNING: Comparison rates are true only for the examples given and may not include all fees and charges. Different terms, fees or other loan amounts might result in a different comparison rate.

* The rate you are offered is calculated based on your personal circumstances and credit history. A few different factors are considered, including:

  • Your credit score.
  • Information provided in your application.
  • Existing loans.
  • The loan amount and your perceived ability to repay the loan.

Your personalised rate won’t be confirmed until you receive an offer from us (if approved) and is subject change before your loan settles.