When thinking about buying a car, make sure you shop around and consider which vehicle is the best for you.
Purchasing a car can be a significant investment. To help you find the option that is best for you, sellers need to give you correct information about a vehicle so you know what you are getting.
If you buy a car from a car dealer or registered motor vehicle seller you are protected by consumer laws. Remember private sellers don't have the same obligation to help if something goes wrong.
If you are buying a new car from a registered car dealer, consumer laws will apply. Businesses and salespeople must not mislead you about the vehicle, including details about the price, quality, features, or any discounts – everything must be accurate and clearly described.
If you are looking to buy a car online, it is a good idea to try and arrange an inspection before you decide to purchase. Motor vehicle traders have the same legal obligations whether they are selling cars off the lot or online.
So that you know whether or not you have consumer law protections, sellers must make it clear if they are in trade. They must disclose their trader status clearly and prominently in every place where a you can make a purchase, including online. Sellers cannot avoid disclosing they are in trade by using agents to sell cars on their behalf.
Example:
Liam sells cars as a registered car dealer. One of his customers trades in an old car when buying a new one. Liam asks his uncle to sell the trade-in car on his behalf to try and avoid consumer laws. Liam is in trade when his uncle sells the car, because his uncle is his agent under the Fair Trading Act and Liam continues to be responsible for the sale. Liam’s uncle may also be breaching consumer laws.
Buying from a registered used motor vehicle dealer
If an individual sells more than six vehicles in a 12 month period, they must be registered as a used motor vehicle dealer.
There are different legal obligations for motor vehicle dealers than for private sellers, so it is important you know if you are buying from a motor vehicle dealer. See the Motor Vehicle Traders Register to check if they are registered.
If you are buying a used car from a registered used motor vehicle dealer, they must display an accurate and complete Consumer Information Notice (CIN) on the car. This rule applies whether the car is advertised for sale at a car yard or online (where the purchase of the vehicle can be completed online).
The CIN provides you with information about the vehicle so that you can make a better informed decision. when considering purchasing the car.
Buying a car privately can be a good option – you may get a better deal or have more options if you choose to buy privately, but there are also some things you should be aware of.
Often private sales are made on an "as is, where is" basis which means you would be responsible for any problems after buying the car. Private sellers do not have to provide a CIN or comply with consumer laws.
If you have problems when buying a car through a private seller, you can contact the Disputes Tribunal, or see the Consumer Protection website for information on solving issues with your private seller.
Pre-purchase inspections and checks
When buying a car it is a good idea to inspect the car before you make a decision to purchase to ensure you are getting what you expect. This includes things like going for a test drive, checking the history and paperwork, asking the seller about the car, and getting it inspected by a professional.
Take your time to think about the car and carry out inspections and checks – don't feel pressured to buy on the spot.
If you haven't got enough money to pay for a car in full, you may consider taking out a loan to pay for it. Think about this carefully as there may be fees and interest charges that mean you pay more for the car in the long run than if you pay cash.
If you do decide to take out a loan make sure you shop around. You do not have to get the loan from the car dealer you are purchasing the car from, you can borrow the money from a bank or other lender.
