Buying A Used Car? Read Our Tips

Purchasing a new car should be a fun and exciting time, but it can quickly become stressful if you don't properly prepare. There are a few things to consider before you become the proud owner of your new set of wheels.

In this post, we break down the top tips to keep in mind when buying a used car.

What You Need To Consider When Buying A Used Car

Set A Budget

Set yourself an amount and stick to it! Be prepared to negotiate on price to keep within your budget and avoid overspending. Do your research on the make and model of the car you’re after to see what the going price is. If you need to take out a used car loan, you should factor repayments into your budget as well. Use our car loan repayment calculator to get an idea of what repayments will be.

You can then use our budget calculator to see how car loan repayments will affect the money you have leftover.

Speak with one of our experienced lending specialists about gaining pre-approval. This is a great way to know exactly how much you can afford. You can then shop with confidence at the dealerships or when negotiating with a private seller.

Do Your Research

If you’re buying a used car in NSW, check out car-buying sites online where you can select different makes, models, prices and set the location you’re looking to buy in. It is important to set a budget first so that online sites such as or can help you get an idea of what vehicles are available within your price bracket. There’s a handy value guide to help you know what the value of a car is and how much you should pay.

Be wary of cars that seem too cheap. If something appears too good to be true, it probably is. It may have issues that are not immediately visible. Doing an inspection yourself followed by an inspection at a mechanic is always a good idea. We’ll go into more detail about this in the next section.

During your research, make a list of all upfront costs:

  • Purchase price of the vehicle

  • If applying for a used car loan, application fees and any other ongoing fees

  • Registration if it's soon due for renewal

  • CTP Green Slip if it's soon due for renewal

  • Insurance cover

  • New tyres if needed

  • Mechanical service if needed

  • Stamp duty – you can use the Revenue NSW stamp duty calculator for an estimate of how much it will cost to transfer the vehicle into your name. 

Get A Pre-purchase Car Inspection

If inspecting the car at a private sellers house, there are a few things you can look at yourself:

  • Be sure to inspect the car during the day to clearly see any dents, marks or scratches.

  • Check under the bonnet, and on the ground under the car looking for signs of any oil leaks.

  • Check all tyres – including the spare – to make sure they still have tread and are wearing evenly. The low tread will mean new tyres upfront which will be an added cost.

  • Looking inside the car, check to make sure the seatbelts work correctly and aren’t damaged, the front seats move properly and all switches and features work.

  • A good tip is to start the car when the engine is cold, which can help reveal problems like poor starting or smoke which indicates engine wear.

Taking the vehicle to a mechanic you trust is a good idea. They will be able to hoist the car up and properly check underneath as well as the engine function. This may come at a cost but you are better off knowing upfront if the car has issues, rather than forking out for costly repairs down the road.

Test driving the car is another obvious way to gauge how it runs. Listening out for any odd engine noises is key, so turn the radio off. Other things to check are the handbrake, power steering, central locking and how easily the car shifts through gears.

If possible, get on a highway to drive at a higher speed as well as driving slower around a neighbourhood. Drive up a hill to see how it handles going up a steep incline. Driving on a different surface such as gravel can also indicate how well the car handles off-road. Going over speed humps will help you test the suspension.

Organise Insurance Cover

A Compulsory Third Party Green Slip will need to be purchased when you buy your car. Take note of when the current CTP Green Slip policy ends, as you may need to factor this into your costs sooner if it is due for renewal.

When shopping around for insurance policies, there is a wide range of cover options and inclusions that you can choose from to suit your needs and circumstances. Have your insurance begin from the date that ownership is transferred to your name.

At Horizon Bank, we’re proud to offer our members a range of motor vehicle insurance cover through CGU insurance. We also offer CTP Green Slips through QBE. If you choose to take out a used car loan with us, we can organize the insurance cover for you during the loan process.

There are lots of options to choose from when it comes to selecting and buying a used car. By doing your research and being prepared, you’ll be driving away happy in no time. For more helpful tips and info, check out our blog on when is the best time to buy a car.

If you still have a few questions, we can help! Horizon Bank is here to assist with your car loan and insurance needs. Get in touch with our friendly team today and let’s talk about your used car plans. We have bank branches throughout the Illawarra and South Coast with convenient locations.

Horizon Bank has a branch network spanning the NSW South Coast and Illawarra. Horizon Bank branch locations: Albion Park, Bega, Bermagui, Berry, Merimbula, Moruya, Nowra, Thirroul, Ulladulla & Wollongong.

The content in this article has been prepared by Horizon Bank for general information only and it is not intended to be professional advice. It does not take into account your objectives, financial situation or needs. You should seek your own legal, accounting, financial or other professional advice where appropriate, and consider the relevant General Terms and Conditions before deciding whether to acquire any products or services offered by Horizon Bank and/or its affiliated partners. We do not recommend any third party products or services referred to in this article unless otherwise stated and we are not liable in relation to them. Any links to third party websites are for your information and we do not endorse any content on those sites. Horizon Credit Union Ltd ABN 66 087 650 173 AFSL and Australian Credit Licence Number 240573 trading as Horizon Bank.
The advice on this web page is general advice only and does not take into account your individual objectives, financial situation or needs ('your personal circumstances'). Before using this advice to decide whether to purchase or hold this insurance policy, you should consider the appropriateness of it having regard to your personal circumstances. Horizon Bank ABN 66 087 650 173 acts under its own Australian Financial Services Licence (no. 240573) and under an agreement with the insurer, Insurance Australia Limited ABN 11 000 016 722 trading as CGU Insurance (CGU). Backed by IAG. Insurance is issued by CGU. You can get a Product Disclosure Statement (PDS) for the products from any branch of Horizon Bank or CGU. You should consider the PDS in deciding whether to buy or hold the product.
CTP Green Slip insurance (CTP) is issued by QBE Insurance (Australia) Limited (ABN 78 003 191 035, AFSL 239545) (QBE). Horizon Bank (ABN 66 087 650, AFSL 240573) is authorised to distribute CTP as an agent of QBE and is remunerated by QBE. Please read your CTP policy for further information before purchasing CTP. Horizon Bank does not provide any advice based on any consideration of your objectives, financial situation or needs. Terms, conditions, limits and exclusions apply. Before making a decision please consider the Product Disclosure Statement.