What you need to know when putting a deposit down for a used car

Last updated on November 25th, 2021 at 10:14 am by Bill Tsouvalas

Finding a used car that comes with all the bells and whistles can get anyone excited, and it isn’t uncommon to want to get it off the market before other buyers find it. Your seller may ask for a deposit as proof that you are not a time waster, but before you put your money down these are the few things you need to consider.

1. Don’t be too quick on paying the deposit

The last thing that you want is losing money during the transaction of purchasing a used car. Firstly, you need to be sure that the vehicle is something that you want to purchase. If you haven’t done the necessary checks on the car and didn’t do a test drive, stall putting down a deposit. Secondly, avoid putting down a deposit if you haven’t run a car history check on sites such as PPSR or CarHistory. This can literally save you money and dodge the bullet of purchasing a car that has been stolen or has finance owing on it.

2. Don’t bite if it’s not written in black and white

Many a time some Aussies have found themselves in agreement with a seller verbally but find something different to what was agreed to when it comes to the sales contract. When it comes to leaving a deposit as security it is vital that you ask for a written statement of the terms that come with this, especially if you want to take the car to a mechanic to have it checked out. It would be preferable to get a written agreement that states that you will get your money back once you have followed the terms.

3. Read the contract carefully

The devil is in the detail and the only time to catch him out is by reading the contract carefully. It may not be the most exciting part of purchasing a used car, but it can help you save thousands of dollars later. This is where you can check if there are any hidden fees or costs. Avoid signing anything if you feel under pressure, or if the contract is too long. Rather ask the seller if you could take it home with you to read over it than to sign it.

4. Negotiate as much as you can

There is still room to negotiate your way to a better deal. This also means negotiating the cost of the deposit. Some buyers may feel pressured by the seller that there are other people who are ready to purchase it but don’t give in to such pressure without negotiating. Always keep in mind that the minute you place the deposit in the seller’s hand you forfeit any type of negotiation.

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