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Car Buying Guide
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Yes Loans Car Buying Guide
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Congratulations!
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You have made a good choice getting the Yes Loans Car You have taken the first step towards getting your next new or used car.
We will help you develop a plan for buying your next car by
introducing you to what you need to know before you head
to the dealership.
By the time you have read this guide you should be able to
buy your car with confidence because you will know how to:
 decide on what car is right for you,
have your fi nance pre approved before you go to the
dealership, and
be in control of your fi nance and purchasing options. |
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Yes Loans Pty Ltd
301 Albany Hwy
Victoria Park WA 6100
Phone 08 9472 3000
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4. Online Research
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4
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5. Financing Your Car
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4
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5.1 Your Credit Score
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4
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6. When to Finance
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5
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6.2 About Interest Rates
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5
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7. Buying Your Next Car
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8. Making the Deal
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8.2 Buying Your Car
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8.3 Trading Your Car
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8.4 Selling Your Car
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6
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8.5 Negotiating Tips
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6
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9.1 Buying a New Car
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7
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11. Buying from a Dealer
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11.1 Buying Privately
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15. Car Buying Glossary
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16 Stamp Duty
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16
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16.2 More Information
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17
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1. Your Budget: Income and Expenditure
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The fi rst step toward buying a car is fi nding out how much you can spend. To do that, enter your monthly income after tax in the worksheet below and subtract your monthly expenses. Add additional expenses, if necessary. The remaining balance is an estimate of what you can put toward your monthly car payment.
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Monthly Living Expense Worksheet
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Monthly Income:
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Monthly Income After Tax
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$
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Monthly Expenses:
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Mortgage/Rent Payment
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-$
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Utilities (power, phone, gas)
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-$
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Food
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-$
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Transportation
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-$
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Insurance (Home, Car, Life)
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-$
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Entertainment
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-$
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Education
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-$
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Credit Card Payments
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-$
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Other Creditor Payments
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-$
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Other Vehicle Payments
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-$
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Miscellaneous
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-$
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Remaining balance
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for your car payment
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=$
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2. Before You Start Looking
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Decide what kind of car you need, e.g. four or six cylinder, wagon or sedan, manual
or automatic etc.
Set yourself a limit (budget) on how much you can afford to spend to buy the car.
Remember to allow for stamp duty and transfer fees.
In your budget, make allowances for the running costs of the vehicle including petrol,
insurance, registration, servicing and maintenance.
Do some research by looking through the vehicles listed on www.wacars.com.au to get
an idea of how much you can expect to pay for the car.
Find out about the availability and cost of spare parts, particularly for imported and older
cars.
You may have already decided on a car before you found this guide, but is that car the best
option for your lifestyle and budget? Are you better off with a new or used car?
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2.1 Pre-Owned Car Inspection Checklist
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Area Inspected
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Pass/Fail
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Exterior
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Paint and chrome
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Make, Model, and Year:
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Glass and metal surfaces
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Leaks below engine
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Odometer Mileage:
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Tyres
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Tread wear
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Owner/Dealer:
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Spare tyre and jack
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Interior
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Carpets and upholstery
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Asking Price:
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Seat controls
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Dashboard Controls
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Address:
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Windshield washer and wipers
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Air conditioner, heater and defroster
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Phone:
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Lights
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Dashboard and interior lights
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Headlights, brake, turn signals
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Date:
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Start the Engine
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Engine shaking or stalling
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Owner’s Manual Included?:
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3. Accessories and Add-ons
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Accessories and add-ons added to a new car can increase the value of the car, but they will also increase the total price and your monthly car
loan payment. Below, we’ve listed popular accessories that you may want to add on to your new vehicle.
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3.1 Accessories Checklist
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From the list below, mark which items you consider to be a need or a want. This will help you choose which accessories are necessary and
help you stay within budget.
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The internet offers many resources for car buyers to research vehicles,sell and buy cars and find a new or used car loan.
You can take a lot of the hassle out of buying and fi nancing your next car by applying on line with www.yesloans.com.au. We can help with
fi nding your next car and also get you a loan pre approved.
This is a free service to clients of www.yesloans.com.au and we can often save you thousands of dollars.
The vehicle can be brought to your home or work.
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It’s important to understand your credit situation before determining
if you can fi nance a car, who your lender should be, and when you
should begin the process of obtaining your car loan.
Yes Loans always recommends getting pre approval.
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A credit score is used to help determine the likelihood of a borrower
paying back a loan. Your score is determined in part by your credit
payment history. It’s a great idea to review your credit report for
accuracy at least once a year. If you believe it’s inaccurate, you have
the right to challenge that information.
At Yes Loans we will provide you with a free copy of your credit file.
If your credit score is lower than you expected, here are some tips that
could help you out:
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Consistently pay your bills on time.
SPay down your debt.
Don’t open a new line of credit, like a credit card or home equityloan.
Maintain a solid job history.
Don’t’ make multiple applications for loans.
We offer a number of fi nancial options tailored to your needs, based on your complete fi nancial profi le and credit history. Plus, we have exceptional customer service and the No Hassle experience you deserve.
*You can get approval on line at www.yesloans.com.au.
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6. When to Finance
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7. Buying Your Next Car
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Have your car loan in place before you visit the dealership. This way you can focus on getting the best price for your car. You’ll know your fi nancing terms up front, and that’s one less thing to negotiate at the dealership.
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6.1 Finance with Yes Loans
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You can apply online now for a pre approved
car loan.
If you’re ready to apply visit www.yesloans.
com.au to fi ll out an application.
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6.2 About Interest Rates
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Having a fi xed interest rate for the life of
your car loan allows you to know what your
monthly payment will be month after month,
with no surprises.
If Yes Loans arranges your car loan, the
interest rate will not change over the life
of the loan. That means you know for
sure how much money you’ll save when
comparing other fi nance offers. Our rates are
competitive.
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You have several options when it comes to buying your next car. We’ve already mentioned online resources where you can
research and even buy your next car. Keep in mind you could always go the traditional route and visit your local dealership. Or you could take advantage of our Yes Loans (No Charge) program when looking for your next car.
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7.1 Yes Loans Car Buying Service
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If you want to avoid negotiating the price of
your next vehicle, but still know you’re getting
a great deal, then our Yes Loans Car Buying
program is perfect for you. We will get you a
low, No Hassle price on any vehicle purchased
through a participating dealership.
Just visit www.yesloans.com.au and you’ll
discover a huge inventory of new and used
vehicles to choose from. You can research
and select a new car online or look for the
ideal pre-owned vehicle. Next, we’ll direct you
to a participating dealership where you can
test-drive your car and complete the buying
process.
Remember, there’s no need for negotiating,
so you’ll save time at the dealership. Just
test-drive your car, complete the transaction,
and off you’ll go!
To save even more time, you can have your
fi nance pre approved.
Ready to get started? Visit www.yesloans.
com.au to get a No Hassle price on your next
vehicle and pre approved fi nance.
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8. Making the Deal
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Too often, people try to negotiate all
elements of a car deal at once. The fact is,
your purchase is several transactions that
should be negotiated separately–besides
securing car fi nancing, there is a negotiation
associated with buying the car and trading or
selling a car that you already own.
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8.1 Visiting the Dealership
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There’s usually at least one dealership in
every town and they provide the opportunity
for you to get to know your options up close
and personal. We suggest you visit a few to
research the vehicles that you’re interested in
and to take them for a test drive or two.
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8.2 Buying Your Car
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The key to fair negotiation is equal
knowledge. By researching vehicle pricing
before heading to the dealership, you’ll
become more aware of what is a fair price.
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8.3 Trading Your Car
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You can expect a dealership to offer the
wholesale value of your trade-in, minus
deductions for excessive wear and tear
and high mileage. Why the wholesale
value instead of the retail value? When the
dealership buys your used car, they are taking
on the extra costs of selling it to someone
else. The dealership also has to prepare the
car so it can be sold.
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8.4 Selling Your Car
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If you want to get a higher price on your
current vehicle, consider selling your
car privately. Just remember, you’ll have
to advertise it, take the calls, meet the
prospective buyers, let them test-drive your
car, and handle the fi nancial transaction.
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8.5 Negotiating Tips
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Be flexible on features. Be prepared to
compromise, but only on the extra features
that are not on your need list.
Ask questions. Be sure to understand the dealership’s offer and have them explain each number presented to you.
Be prepared to wait. Buying a vehicle is big commitment, so be prepared to take your time at the dealership.
Get it in writing. Have the sales consultant give you a quote with the price, terms, and options that are
included in the deal. Before you drive away make sure the seller
has given you:
all keys, including those for the glove box,
the service books, owner’s manual and log book,
instructions for working and de-activating the alarm,
location of hidden ignition switch, if there is one, and
radio security number.
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9. Before Signing a Contract with a Dealer
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Before signing a contract with a dealer, unless
you are prepared to purchase the car, do not
sign an “Offer to Purchase”, “Contract to Buy
a Motor Vehicle” or any document as it can be
legally binding.
Make sure that any conditions the purchase is
subject to are included as written conditions
on the contract. This includes verbal promises
made by the dealer about doing something
to the car as part of the purchase. Any
promises should be confi rmed in writing on
the contract.
All special conditions must be written out in full on the contract. You must be specifi c: e.g. "subject to mechanical report from XYZ Mechanics, that is satisfactory to the purchaser" or "subject to fi nance approval from the respective branch of ABC Bank for a loan of $10,000, taken over 4 years with repayments of no more than $300 per month".
Make sure that any blank spaces or conditions on the contract which do not apply to your purchase are crossed out, initialled and dated by you and the dealer.
Check that you can afford the contract price and that it is within your budget.
Read and understand the terms and conditions of the contract thoroughly. If you do not understand something, get it clarified.
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9.1 Buying a New Car
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Make sure you are given a defi nite delivery date and include it on the contract.
Having “as soon as possible”, or leaving the delivery date blank on the contract, could mean a wait of several months.
Check the contract for clauses that allow for a revaluation of your trade-in if the deal isn’t completed within a certain time, unless you have agreed to this.
Check the contract for clauses that allow for price rises to be passed on to you while you wait for delivery, unless you
have agreed to this.
Ensure that the paint colour of the car and interior colour codes are correctly stated on the contract.
If the new car you are considering buying is in stock and able to be inspected check that the model number and the year given to you as the date of manufacture are the same as those stamped on the compliance/vehicle identifi cation plates in the engine bay of the vehicle.
If the car has to be ordered make sure the correct year and model number are stated on the contract. Remember, some manufacturers bring out new models during the year, so it is important to include both.
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10. Used Car Statutory Warranties
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Only licensed dealers are required to provide a statutory warranty on vehicles they sell. Most, but not all, used passenger cars sold by dealers have a warranty. For example where the cash price paid is $4,000 or less, no statutory warranty applies.
Certain types of used cars, eg four-wheel drives and most commercial vehicles are not always required to be covered by warranty.
A statutory warranty cannot be waived unless an application has been made to, and approved by the Commissioner for Consumer Affairs at the Ministry of Fair Trading. These applications normally result because of a substantial discount offered by the dealer on the price of the
car, in return for you buying it with no warranty.
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10.1 Dealer Responsibilities under a Used Car Warranty
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A dealer must repair all defects which make
or are likely to make a vehicle unroadworthy
or unserviceable. The repair should make
the vehicle roadworthy and in a reasonable
condition having regard to its age. For
example; it may not be necessary to fi t new
parts to a 10 year old vehicle if serviceable
second-hand parts are available.
A dealer can arrange for someone to do
warranty repairs. The Motor Vehicle Dealers
Act does not specifi cally require you to
return a vehicle to the selling dealer for
warranty repairs, but the Ministry considers it
reasonable to do so in the fi rst instance.
If you don’t do this and get the vehicle
repaired elsewhere at your expense, the
dealer may only have to pay what his or her
costs would have been to repair the defects.
It is important to note however, that the
condition of merchantable quality does not
apply if:
defects are specifi cally drawn to your attention before the contract is made, or
you examine a vehicle for defects before the contract is made, and that examination should have identified certain faults.
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If you live reasonably close to the dealer and
the vehicle can be driven, you should go and
see the dealer. If the vehicle cannot be driven,
the dealer should arrange and pay for the cost
of towing the vehicle in for repairs.
If you don’t live reasonably dose to the dealer
and require warranty repairs, the dealer has
two options. One is to arrange for a repairer
in your area to fi x the vehicle; the other is to
transport the vehicle to his or her premises
for repairs and return it when fi xed. Both of
these options should be at no cost to you.
A dealer does not have to give you a loan
car while fi xing your vehicle under warranty.
Some however, make a commercial decision
to supply loan cars to their customers
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10.2 Implied Warranties under the Fair Trading Act
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The Fair Trading Act places certain obligations
on a dealer when selling a vehicle.
The must provide a vehicle that has a clear
title, matches any description which has been
given and be of “merchantable quality”, i.e. fi t
for the purpose which a vehicle of that nature
is normally used.. The price of a vehicle is
also taken into account when determining
merchantable quality.
If you buy a vehicle that is not covered by
warranty under the Motor Vehicle Dealers
Act, a dealer may still be responsible for
some repairs under the Fair Trading Act. For
example, a vehicle may be considered not
to be of merchantable quality if there is a
major defect which prevents it from being
used in the normal way, or makes it unsafe to
drive (eg.faulty brakes, faulty steering, major
structural rust).
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11. Buying from a Dealer
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Check the details of the car on the form usually found on the dashboard or
hanging in the window. Don’t just rely on the information contained on a website or in the paper.
Check that the year stated as the date
of manufacture is the same as the date
stamped on the compliance/vehicle
identifi cation plates. This can be found in
the engine bay of the vehicle.
Check that the car is registered and
when the registration expires. This
applies particularly to private purchases,
also check dealer cars.
Check for notices stating any warranty
exemptions on a used vehicle. These
notices are usually found on the
dashboard.
Check all accessories not covered by the
statutory warranty; e.g. radio/cassette,
air conditioning battery, tyres including
spare, jack and tools.
Take the car for a test drive.
Get a complete, written independent
mechanical report.
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11.1 Buying Privately
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Remember that buying a car privately means
“buyers beware”. There is no warranty
applicable, the car may have money owing on
it or could even be stolen.
Check that the year given to you by the
seller as the date of manufacture, is
the same as the date stamped on the
compliance/vehicle identifi cation plates,
usually found in the engine bay of the
vehicle.
Compare the number plate details
carefully with those stated on the
registration papers.
Check that the chassis number/vehicle
identifi cation number (VIN) and engine
number details on the plates in the
engine bay, are the same as those on the
registration papers.
Check that the car is licensed, and when
the registration expires.
Have the car mechanically inspected.
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12. Register of Encumbered Vehicles (REVS)
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12.1 What is a REVS Check?
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REVS can tell you whether a motor vehicle or motorcycle has money
owing on it before you purchase a vehicle. This is important because
someone else (eg. a bank or fi nance company) may be able to
repossess the vehicle you have purchased.
To do a REVS search you will need;
the motor vehicle/motorcycle registration number,
the engine number, and
the chassis or vehicle identifi cation number of the vehicle.
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12.2 What Information can I get from REVS?
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REVS can tell you whether a vehicle or boat you are intending to
purchase has any fi nancial encumbrance registered against it BEFORE
you make the purchase.
If there is money owing, REVS can advise you on how to manage the
purchase safety.
As a part of the REVS encumbrance check you will also be informed if
a vehicle is:
recognised as a licensed motor vehicle,
recorded as stolen, ord
recorded as written-off.
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12.3 REVS Checks in Your State
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REVS was established in 1986 by the Registration of Interests in
Goods Act 1986 (RIGA).
REVS stands for the Register of Encumbered Vehicles. It is a statutory
public register which assists:
the general public,
the fi nance sector, and
the motor trade.
The register holds information about motor vehicles and boats that
have been used as security for a loan from a bank, fi nance company,
credit union or other credit providers. Below is a list of links and useful information for how and where to get REV checks done
in your state:
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Western Australia
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For REV checks in WA, please visit the Department of Consumer and
Employment Protection at
https://bizline.commerce.wa.gov.au/revs/
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Queensland
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For REV checks in QLD, please visit Transport Online Services in
Queensland at
https://www.service.transport.qld.gov.au/vehicle informationcheckQt/
Welcome.jsp
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New South Wales
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For REV checks in NSW, please visit the NSW Fair Trading website at
http://www.revs.nsw.gov.au/
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Victoria
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For REV checks in Victoria, please visit the VIC Roads website at
http://www.vicroads.vic.gov.au/Home/
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South Australia
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For REV checks in SA, visit EzyReg South Australia at
https://www.ecom.transport.sa.gov.au/et/welcome.jsp
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Tasmania
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For REV checks in Tasmania, please visit the Tasmania Transport website at
https://www.transport.tas.gov.au/pls/apex/f?p=202:200:266992717217661
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Northern Territory
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For REV checks in NT, please visit the Government of Northern Territory
website
https://www.nt.gov.au/
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13. Outstanding Debt on a Vehicle?
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1. Ask the seller to obtain a payout fi gure in writing from the
financier.
2. Purchase a REVS certifi cate for protection against
repossession of the vehicle due to fi nancial interests that have
not been registered with REVS.
3. Make out two (2) separate cheques-one payable to the
fi nancier for the total payout fi gure, and the other to the seller
for the balance. Never pay the seller the full amount or leave it
to them to pay their outstanding loan as you have no guarantee
that he/she will pay out the debt.
4. Ask the seller and fi nancier for a receipt. This should be done
at the fi nancier’s offi ce. Some lenders will pay the fi nance
company directly. It is also recommended that you obtain
a copy of the letter of discharge from the fi nancier, which
confi rms that they no longer have an interest in the vehicle.
Keep this letter with your REVS Certifi cate.
5. Make sure that you fi nalise the purchase of the vehicle before
midnight of the day after the certifi cate is purchased. That
is, if you buy REVS Certifi cate on a Thursday, then you must
pay for the vehicle (hand over the cheques to fi nancier and
the seller) before midnight of the Friday. This sequence of
events ensures that the REVS Certifi cate remains a valid legal
document.
Please note that, as fi nanciers have 14 days in which to cancel their
interests with REVS once a debt has been paid out, the certifi cate
may still show the fi nancial encumbrance warning even though you
have paid out the debt. The letter of discharge (or copy) from the
financier is proof that the seller’s debt has been paid out.
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Fill out this form before you make an offer to buy a vehicle. It’s only a guide but you
should make sure you are satisfi ed with all the answers.
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1.
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Check that the seller’s driver’s licence matches
the name on the registration papers. Does it?
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 Yes
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No
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2.
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If not, who is the owner?
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3.
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Why are they selling the car?
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4.
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How long have they owned the vehicle?
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5.
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Is a loan outstanding on the car and is the car
secured against it?
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Yes
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No
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6.
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Has the vehicle had any accident damage
repaired?
If yes, what and when?
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Yes
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No
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If yes, what and when?
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7.
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Does the seller have the car’s “service book”
showing services competed, and stamped by
the dealer/ service centre?
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Yes
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No
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8.
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Do they have copies of workshop invoices for
any work or services carried out?
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Yes
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No
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9.
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Ask to see the registration papers. You’ll want
these to record the vehicle details. How much
registration and CTP remains?
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Rego expiry date:
CTP expiry date:
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You will need the vehicle identifi cation details from the registration papers – you’ll need
them to do a REV check.
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Chassis/VIN number
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--------------------------------------------------------------------
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(17 character – alphanumeric)
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Engine number
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--------------------------------------------------------------------
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Registration number
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--------------------------------------------------------------------
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(Is it a NSW plate?)
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NSW |
Other |
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You can refer to the vehicle’s handbook to locate the chassis /VIN number. Now check them on
the vehicle itself.
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IMPORTANT – you now need to get a REVS certifi cate no more than 24 hours before you buy
the vehicle. If you are happy with the results of this certifi cate you can start negotiating with
the seller to buy!
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Price agreed (subject to REVS check):
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Address from vehicle registration:
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Seller’s driver’s licence number:
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What if there is an outstanding loan against the car? See page 12.
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14. Private Purchase Checklist
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Vehicle Make:
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Vehicle Model:
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Year of Manufacture:
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VIN:
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Chassis Number:
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Colour:
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Registration Number:
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Registration Exiry Date:
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Agreed Price:
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Amount Paid:
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Balance Remaining:
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Date:
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Seller Name:
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Seller Address:
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Seller Signature:
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APR (Annual Percentage Rate), interest rate:
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The yearly rate charged to a consumer to borrow the finance company’s money. APR is usually expressed as a percentage.
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Depreciation:
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The value an asset loses due to wear and tear or time.
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Equity (vehicle):
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The value of the vehicle minus the loan amount.
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Extended warranty:
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A contract that covers certain car repairs or problems
after the manufacturer’s or dealer’s warranty expires.
Extended warranties are sold by car manufacturers,
dealers, and independent companies. With a new car,
the extended warranty usually must be purchased by the
end of the fi rst year of ownership.
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Interest:
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The amount charged by the fi nance company to borrow
money.
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Manufacturer’s
Recommended Retail
Price (RRP):
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The retail price determined by the manufacturer and
posted on the window sticker. The RRP for a vehicle
includes no additional options.
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Monthly Payment:
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The principal and interest paid on a monthly basis over
the life of the loan.
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CTP:
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Compulsory third party insurance.
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Stamp duty:
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This is a government charge – see under Stamp Duty in
Buying Guide.
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Dealer delivery:
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This is a fee that the dealer adds to the price of the car.
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REVS: Register of
Encumbered Vehicles.
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This is a check to see if there is any money owing on
your vehicle.
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16. Stamp Duty
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Known variously as Motor Vehicle Duty,
Vehicle Registration Duty, Motor Vehicle
Registration Duty and Motor Vehicle Stamp
Duty, these taxes are defi ned and collected by
state governments
Stamp duty is a payment that must be made
to the state government on the purchase of
any new or used vehicle. The actual amount
of stamp duty and how to calculate it varies
quite considerably from state-to-state but is
always calculated based on the GST inclusive
cost of the vehicle.
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When purchasing a new vehicle is quoted as
“on-the-road” the stamp duty is accounted
for. In fact, the supplying dealer will pay the
stamp duty on your behalf once payment
has been received. When purchasing a used
vehicle from a dealer, the cheque to the
dealer will not be the only payment. Stamp
duty based on the car purchase price and
registration charges will have to be paid at
the local motor registry following delivery of
the vehicle. This is important to bear in mind
when choosing between a late model used
vehicle and a brand new vehicle.
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16.1 What Stamp Duty Costs
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ACT
Stamp duty on new vehicles in the ACT is charged as follows:
3% of the vehicle price inclusive of GST up to $45,000
5% for every dollar over $45,000
New South Wales
Stamp duty on vehicle purchase is charged as follows:
3% of the vehicle price inclusive of GST up to $45,000
5% for every dollar over $45,000
Example: a car costing $65,000, stamp duty would be charged at 3% of $45,000 plus 5% of
$20,000 (the amount above the $45,000 threshold) = $1,350 + $1,000 = $2,350.
Queensland
Stamp duty in Queensland is now based on the engine size as well as the purchase price.
Victoria
Victoria has two thresholds for stamp duty charges though the percentage applies to the total
market value of the vehicle.
2.5% of the vehicle price up to $57,009
5% of the total price where this is over $57,009
South Australia
South Australia has a low threshold that must be observed
$60 for the fi rst $3,000 of the purchase price (or part thereof)
4% for every dollar over $3.000
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For more information about vehicle and other types of stamp duty, contact your local State
Revenue Office.
Australian Capital Territory – www.revenue.act.gov.au
New South Wales – www.sr.new.gov.au
Queensland – www.sr.qld.gov.au
Victoria – www.sro.vic.gov.au
South Australia – www.revenuesa.gov.au
Tasmania – www.srt.tas.gov.au
Northern Territory – www.revenue.nt.gov.au
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