Private Sale Car Loan

Buying a used car from a private seller, instead of a licensed car dealership, means we’ll need a bit more details and you’ll need to take a few extra steps, but don’t worry, we’ll be with you every step of the way.

A private sale car loan is when a vehicle finance company lends you the money to buy a vehicle from a private seller (not a dealership). The lender will then hold security over the privately purchased vehicle for the duration of the loan. Private sale car loans can be used for personal or commercial use. Speak with us about how we can best structure your loan to suit you and the repayment that you are trying to achieve.

Our private sale car loan is secured by the vehicle. As such, we’ll need some information from the seller about the car in order to approve the loan. Typically, you will need to provide:

• Current vehicle registration certificate
• Current owner’s drivers licence and banking details
• Sale agreement, and potentially
• Financier payout letter if the vehicle is encumbered

The first step most people take is to get pre-approved for a private sale car loan. This gives you a budget, which makes it easy to search for a car. Of course, if you have already found the car first then you can also apply for a specific amount, making sure to include all car details.

Yes.

Getting a car loan pre-approval gives you the confidence to make an offer on your next vehicle before it’s taken off the market by another private buyer. It also give you great bargaining power with the seller. Talk with us about getting a private sale car loan pre-approval.

Yes.

Whether you buy privately or through a dealer, the car loan application process is similar. Our income and overall profile requirements for your application are virtually the same in both cases. Private sale car loans need just a few more steps to protect you against fraud and scams.

Since our private sale car loans are secured by the vehicle, you’ll find our interest rates are real good.

Most people like buying their car via private sale, which offer them more room to negotiate a better price than via a dealer, who carry added overheads like rent, salaries, franchise fees and more. Private sellers will also typically discount to get the sale done now, whereas dealers are usually happy to wait.

Buying a car through private sale can save you money, but it’s different to buying a car from a dealer.

Here’s why:

• As the buyer, you don't have the same consumer protections
• This means you are responsible for all checks on the vehicle
• Once you purchase the car privately, you assume full responsibility
• Usually, you cannot take the car back after buying it

A vehicle with finance owing on it is ‘encumbered’. Fortunately, your private sale does not need to stop if you discover the car is under finance. In fact, you can still buy it. There's no need to worry. Finance will still proceed as per normal. You and the current owner just have to decide how to settle the amount owing.

• Payout the loan first - You can payout the loan if you have sufficient funds, then either reduce the asking price accordingly or enter some other agreement. This may save both you and the present owner time and effort.
• Provide a payout letter - Alternatively, the seller will need to provide a payout letter issued by their lender. It will contain essential information that we use to transfer appropriate funds to the previous owners' lender.

Never pay the seller the full sale amount directly if the vehicle is encumbered. Otherwise, if the seller decides not to repay their loan the the car you have purchased may be repossessed to cover the debt.

It depends.

Sellers can request that you put down a deposit so the vehicle isn't sold to anyone else – but you are not obliged to do so. Do not pay a deposit or make an offer until you have all the facts. Even if the car seems absolutely perfect after a test drive, you’ll still want to get more details before you commit to a purchase.

To start, you may want to arrange a mechanical inspection. Get any subsequent deal conditions clearly expressed in writing. For example, in some situations, the seller may ask for a deposit as a form of security. If you want the car examined by a certified mechanic, the seller will probably ask for a security deposit so they’re confident you’ll return the car. In these situations, be thorough and explicit in your conditions for leaving a deposit, and get it in writing. Be sure that if the car fails the mechanical inspection then you stipulate that the seller agrees to return your deposit in full.

Be smart. Being overly eager is what gets most buyers into trouble when negotiating a private purchase.