When you first arrive in Adelaide you are going to be in need of a car, here is a comprehensive guide kindly provided by the Consumer and Business Services of SA.
Buying from a Dealer
Buying from a dealer is usually safer than buying at private sale. If there is a dispute over previous ownership of the vehicle or any finance previously owing, then in most cases, the vehicle dealer, not you, will have to bear any losses.
When you buy from a licensed second-hand vehicle dealer there is an implied condition in the contract that the dealer has the right to sell the vehicle and that there are no encumbrances on the vehicle.
Compare prices, models and engine types. Consider issues like manual or automatic, petrol or diesel. You may decide that an LPG conversion is something that would suit your purposes. These days you may even have the choice of a hybrid vehicle. But be sure to do your research.
Check advertisements for used vehicles carefully as prices for the same year and model of car can vary considerably depending on the car’s condition, the distance it has travelled and what extras have been fitted.
Choose from a licensed second-hand vehicle dealer with a good reputation, because they will usually provide a good follow-up service if problems arise. You can check if the dealer is licensed at Licensing Public Register.
Form 1 notice
Under the Second-hand Vehicle Dealers Act the selling dealer must display certain information in a notice (Form 1 notice) affixed to a window of the vehicle at all times the vehicle is offered for sale. This information includes:
- the dealer’s name and business address
- the address at which any warranty repairs are to be carried out (you may negotiate with the dealer on this point)
- the name and address of the last previous owner (which, if not written on the form, must be supplied to you if you request it)
- the total distance the vehicle has travelled (odometer reading) and a statement about the accuracy of the odometer reading, and the warranty conditions that apply (including items that may be excluded from warranty).
Upon purchasing the vehicle you must be provided with an exact copy of the Form 1 notice that was displayed (purchaser’s copy). This notice has a Form 3 notice printed on the back. The Form 3 notice certifies the details you relied upon to purchase the vehicle, and also confirms the selling price and date of sale etc. so that your warranty rights are protected, and confirms you to be the actual purchaser of the vehicle.
Test drive and inspect
A car may appear to have all the features and looks that you are after, but only after a test drive can you be sure that it is the right one. For example, you may find during a test drive that the car is uncomfortable to drive, the ride bumpier than you expected or that gear changes are difficult.
Licensed dealers will usually allow you to test drive the vehicle (or a demo vehicle when purchasing a new car) before you purchase. Some will allow you to test the vehicle overnight or over a weekend, but most will prefer to accompany you on a short drive within the vicinity of the dealership.
Auction houses won’t usually let you drive the vehicle before auction day. However they will usually allow you to inspect the vehicle as much as is possible without driving it, which may include starting the engine. If considering a purchase at auction, it is a good idea to test drive a car of similar make and/or model prior to the auction if possible.
For private sales, test driving the vehicle is completely up to the owner. You will need to negotiate this with them and may need to offer some form of ‘security’ to them (e.g. giving them your driver’s licence or keys to your current vehicle to hold).
Before you take a car out for a test drive make sure you understand your legal liability should you be involved in an accident during the test. If test driving a car through a licensed dealer, they should be able to advise you regarding this.
Take the car for a test drive along a variety of different roads and speed limits. Practise parking the car, and perform a U turn to establish the turning circle of the car.
With a second-hand car it’s a good idea to have the vehicle inspected by a professional before you buy it. The RAA, MTA service centres and qualified independent mechanics all offer this type of service and will provide you with a comprehensive written report on the vehicle.
Always inspect the car to the best of your ability before you arrange the inspection – this will save you the cost of a mechanical report if you decide the car simply isn’t worth it.
With any vehicle purchase, if you have specific requirements, now is the time to set them out in writing. Your requirements could include the obtaining of finance, a mechanical inspection or ensuring you receive certain agreed vehicle specifications such as colour, build date or delivery date for new vehicle purchases.
Such clauses might specify that:
- The contract is subject to and conditional upon the purchaser obtaining own finance to complete the purchase.
- Vehicle to be delivered by (insert date) otherwise contract will be cancelled and deposit refunded.
- The contract is subject to a mechanical inspection to the purchaser’s satisfaction.
When purchasing a second-hand vehicle from a licensed dealer, the contract should include Form 5 particulars (or Form 6 for motorcycles). Form 5 particulars include details such as:
- a description of the vehicle
- costs for any additional items (e.g. accessories, registration, stamp duty)
- payment details (noting any deposit/trade in amounts), and
- who to contact for repair of defects.
The contract should also include information about your cooling off rights.
The dealer should provide you with an exact copy of the Form 1 (Section 16 Notice) that was displayed on the vehicle, and the Form 3 (Notice to Purchaser). The Form 1 gives a description of the vehicle and its price, the last owner, the dealer and information about duty to repair. The Form 3 confirms you as the actual purchaser of the vehicle and is a certification by the dealer that the information in the Section 16 Notice (Form 1) is correct. (For motorcycles, Form 2 and 4 apply).
Read and make sure you understand the form and check that the sale details and costs are correct before you sign it. Never sign an incomplete contract, and remember to keep a copy of what you sign. If you are unsure about anything in the contract, DON’T SIGN IT.
Recent amendments to the Second-hand Vehicle Dealers Act include the introduction of a two day cooling off period for the purchase of second-hand vehicles. The two day cooling off period only applies to second-hand vehicles purchased through a second-hand vehicle dealer. There is no cooling off period if you buy at auction or through a private sale.
A dealer may ask that a deposit of up to 10% of the purchase price of the vehicle be paid. Then if you decide to cool off and not go through with the purchase, the dealer is entitled to keep the non-refundable part of your deposit (which is $100 or 2%, whichever is less). The balance must be returned to you by the end of the next business day after the dealer receives your notice to cool off.
If the dealer fails to refund the balance of your deposit in time, they have contravened the Act. In these situations, an expiation fee of $500 or a maximum penalty of $5000 may apply. Please contact Consumer and Business Services on 131 882 for advice if this occurs.
Warranties Dealer’s warranty obligations (under the Second-hand Vehicle Dealers Act)
Regardless of warranties, consumer guarantees under the Australian Consumer Law require a product to be of acceptable quality through its reasonable life. This length of time can be determined by the court. However, it may be longer than the warranty period, especially in the case of expensive products such as cars.
Warranty on your car will depend on the sale price and other factors. The statutory warranty applies from the date of purchase.
- Vehicles that cost between $3001 and $6000. They will be covered under warranty for the first 3000km travelled or two months, whichever occurs first.
- Vehicles that cost over $6000. They will be covered under warranty for the first 5000km travelled or three months, whichever occurs first.
If your car needs repairs carried out under the statutory warranty you must contact the trader before having the repairs done, otherwise your statutory warranty may become void and you will have to bear the costs.
It is the dealer’s duty by law to fix certain defects, free of charge, when the vehicle is under warranty.
The dealer may use suitable second-hand replacement parts, but must carry out repairs to accepted trade and industry standards. If you specifically want new parts fitted, you may have to pay the difference. However, you should not pay if the dealer cannot obtain suitable second-hand parts.
Your warranty is extended by the amount of time the dealer keeps your vehicle for repairs. You may apply to the Commissioner for Consumer Affairs to extend the warranty period in certain cases where you did not have use of the vehicle due to a defect and where the delay in obtaining repairs was not your fault.
In most cases, warranty (as detailed or listed on the Form 1) doesn’t apply to:
- vehicles that are sold for $3000 or less
- vehicles that have travelled over 200 000 kilometres before the sale
- vehicles that were first registered more than 15 years ago
- a vehicle that you have had in your possession for three months or more before the date of sale (for example, under lease)
- accessories excluded by the dealer (as listed on the Form 1) defects which result from damage deliberately caused to the vehicle after sale
- normal vehicle servicing defects arising from misuse or negligence after sale
- defects apparent in the paintwork or upholstery at the time of sale defects arising from collision, impact or accident after sale
- defects in the tyres (tyres must be road worthy at time of sale) or battery
- defects not reported to the dealer within the warranty period
- contracts when you waive the warranty.
You should provide the dealer an opportunity to undertake warranty work on your car in the first instance. If you must have warranty work done elsewhere for road-safety or logistical reasons, seek the dealer’s approval and make arrangements with them about who should pay the repair costs. Obtain the dealer’s approval in writing.
Waiving the warranty
Under the Second-hand Vehicle Dealers Act you have the option to forgo the statutory warranty on your car in order to negotiate a better sale price. This option is called a ‘Waiver of Rights.’ To waive your warranty rights, you must sign an agreement (Schedule 6) and have the agreement witnessed by either a Justice of the Peace, a lawyer or an authorised bank manager. The dealer is not permitted to make it a condition of sale. It must be your choice.
You should always have the vehicle checked out independently before you waive your warranty rights. The RAA, an MTA service centre or a qualified independent mechanic can provide this service.
If you are unsure of the Waiver of Rights process, contact Consumer and Business Services on 131 882 for advice.
Some dealers sell or provide free-of-charge extended warranties. These are not the same as your statutory warranty and should not be used until after your statutory warranty has expired.
Make sure you understand what the extended warranty being offered actually covers. Read the policy document or booklet provided by your extended warranty provider carefully.
Problems with a dealer
If you have difficulties with the warranty, standard of repairs or other matters, you should immediately bring it to the attention of the manager or owner of the business. Be calm, polite but firm when explaining the issue and offer solutions that will resolve the problem.
If your efforts fail, put your complaint in writing to the manager or owner, suggesting possible solutions. Request a response by a suitable date.
If the matter is still unresolved, contact Consumer Affairs for advice.
The MTA may assist with complaints concerning its dealer members and the RAA also may provide advice to its members.
- Set a price limit you can afford.
- Take your time, don’t be rushed or pressured.
- If you need finance, shop around for the best deal.
- Understand your rights and the dealers’ obligations.
- Check what is covered by the warranty.
- Don’t sign anything until you’re sure the car is okay and you really do want to buy it .
- Have the car checked by the RAA, an MTA service centre or a qualified independent mechanic before you decide to buy.
- Remember to allow for stamp duty, transfer fees and insurance costs .
- If the vehicle isn’t registered, you will be responsible for this.
- Inspect the white display sheet on the car. Make sure the details match the car you’re buying. Ring the previous owner if you want.
- Have everything you negotiate with the dealer put in writing.