In the second-hand car market, it’s not uncommon to encounter sellers who are looking for some security to close a deal. That is, if you are hoping they will hold onto the vehicle while you stump up the cash, then it’s only fair that a deposit be placed. Not only does this show that your interests are legitimate but it protects the seller in case you pull out of the deal when they have other interested buyers. However, before you make the decision to put down a deposit for a car, consider these vital points.
First things first, it’s all about due diligence
Because there are often caveats dictating the instances in which a car deposit may be refunded, there is nothing more important than being sure this car is the car for you. It’s one thing to think that the car is what you’re after but until you’ve taken it out for a spin, and looked into its detailed history, you’re really just taking a punt – and a risky one at that.
Be sure to arrange a test drive, but also look into the vehicle’s service history and general condition to see if there might be any gremlins hiding under the hood. Most importantly, check the Personal Property Securities Register (PPSR) to ensure that the car has a clean bill of history – that is, it’s neither stolen, written-off, or under finance.
A contract speaks louder than everything else
If there was ever a more important thing when it comes to buying a car, it’s hard to go past a contract. This will not only outline the terms of the sale, but define each party’s rights in the event of a disagreement. Verbal discussions and agreements might be fine for low value asset purchases but a car is not one of them. Always draft a contract – even a simple one – to define the terms surrounding the deposit and under what circumstances you can reclaim it.
Relieve pressure by negotiating
Although a seller may claim to have other prospective buyers waiting in the wings, it’s crucial you do not rush the abovementioned due diligence on account of feeling pressured into the sale. Whether it is the terms of the sale, conditions of the deposit, or the dollar figure associated with either aspect, always try to bargain your way to a better outcome. If you feel as though the seller is trying to close the sale quickly, there may or may not be legitimate reasons. But remember, reversing a bad decision is a far more complex and unlikely task than finding another suitable vehicle to buy.
The Fincar team is here to help you with all your financing needs. Contact us today to help arrange your next car or equipment loan.