Buying privately: how private sale finance works

Buying privately can get you a great vehicle at a good price, and you can finance it just like a dealer purchase. There are a few extra checks along the way, and that's a good thing: they protect you from buying something with a problem.

How it works

• Get pre approval first, so you know your budget before you start looking.
• Find the vehicle and agree on a price with the seller.
• The lender confirms the seller owns the vehicle and runs a PPSR check for finance owing, and whether it's been written off or reported stolen.
• Some lenders also want photos, an inspection or a valuation.
• At settlement, the lender pays the seller directly, and the vehicle is yours.

What if the seller still owes money on it?

That's common, and it's fine. The seller's loan is paid out at settlement from the purchase money, and any balance goes to the seller. The lender gets a clear title, and you get the vehicle free of any debt.

Tips before you buy

• Avoid paying a deposit in cash before the checks are done.
• Get the VIN, registration and seller's details early to speed things up.
• Have a mechanic look over older vehicles, and check the service history.

This guide is general information only and doesn't take into account your objectives, financial situation or needs. It isn't financial, tax or legal advice. Talk to us about your situation, and to your accountant about tax.