When purchasing a car, no one wants to get stuck with a defective vehicle, or ‘lemon’. With the experience potentially leaving a bad taste in your mouth, it can be costly, time-consuming and frustrating. So, how do the laws of Australia Protect you?
In the unlikely event that you purchased a dud car that doesn’t work as it is meant to, or has progressed in the age in the short period you’ve been aware of, two forms of consumer security may be worth investigating are Australian consumer guarantees and used-car statutory warranties.
Australian Consumer Guarantees
In Australia, there is not one clear national ‘lemon rule’ on which to rely. However, when you purchase goods and services under the Australian Consumer Law, they come with automatic assurances that they will operate and do what you have ordered. Motor vehicles (new and used) come under this consumer protection.
Purchasing a used car from a dealer
You automatically obtain a range of guarantees under the Australian Consumer Law when you purchase a second-hand car from a dealer. These include an unspecified but “reasonable time” and provide assurances that the vehicle you purchases.
- It is safe, durable and free from unknown defects.
- Meet the description provided by the dealer or the demonstration model they showed you.
- Before purchasing the car or for some reason, the dealer said it would be fit for any purpose you express to the dealer.
- Spare parts and replacements are available for a reasonable period.
You may be entitled to a repair, replacement or refund if your vehicle fails to meet a consumer promise, which may depend on whether the failure is ‘major’ or ‘minor’. What is crucial for you to note is that, regardless of whether you buy an extended warranty, the car dealer does not refuse to honour a consumer guarantee.
Buying a Used Car from Private Sellers or from Auction
Vehicles purchased from a private seller or by ‘sale by auction’ are protected only by title guarantees, undisturbed ownership and undisclosed securities.
If you purchase a used car from a private seller and find out later that there is a debt owed on it, you might have to repay the loan or risk repossessing it. Consider running a search on the Personal Property Securities Register (PPSR) using the car’s Vehicle Identification Number (VIN) or chassis number before buying a used car, particularly from a private seller or auctioneer. It is possible to complete online and costs $2 at the time of writing.
Mandatory used-car warranties in Australia
In addition to Australian consumer guarantees, when you purchase from a dealer, used cars sold throughout Australia are protected by free, unconditional statutory guarantees in most cases. The states and territories govern these, so depending on your area, each can differ in each’s exact requirements. Statutory warranties appear to be relatively limited in duration.
These used-car statutory warranties offer coverage for defective cars sold by a licenced dealer in most areas. In some cases, whether the vehicle is more than ten years old or clock reading is more than 160,000 km in not come under used-car statutory warranties. After you have signed a purchasing agreement, some states also provide cooling-off periods, which will offer you the ability to terminate the contract under certain circumstances within a set timeframe.
Local laws that apply to you: