The costs of buying a car
Did you know that there’s such a thing as ‘dealer delivery’? Are you aware that ‘on-road’ costs are sometimes added as a cost on top of what you pay for your car? Among other things, these are just some of the costs you need to be aware of when buying your next car.
We go into it a little further here. If you’re already familiar with the costs of buying a car, it’s still worth your while to take the time out to remind yourself of a few pointers. There may be some new ones here too!
Car Loan Comparison Table - rates updated daily
New Car Loan
Including Demo, Fixed, Secured
Monthly repayment4.67% p.a.5.22% p.a.based on $30,000
over 5 years
Low fixed car loan rate for purchasing new and demo vehicles from dealers. There is no monthly or ongoing fees and early payout options available. Winner of Mozo's Experts Choice Car Loan 2021 award^.Details
Read our Mozo Review to learn more about the loans.com.au New Car Loan
Monthly repayment4.89% p.a.to 8.89% p.a.5.44% p.a.to 9.46% p.a.based on $30,000
over 5 years
Enjoy competitively low rate car loans from 4.89% (comparison rate 5.44% p.a.) between $10,000 and $100,000 for new, demo and used vehicles. Take advantage of flexible 3, 5 or 7 year loan terms. No early repayment or exit fees. You must be 21 years or over to qualify and earn above $35,000.Details
Read our Mozo Review to learn more about the Plenti Car Loan
Secured Car Loan
Monthly repayment4.74% p.a.to 16.01% p.a.5.01% p.a.to 16.31% p.a.based on $30,000
over 5 years
Low personalised rates, ideal for borrowers with excellent credit. No monthly account fees, no early payout fees, so you can pay off your loan sooner. Borrow between $5,000 and $63,000. Easy online application, receive a response in minutes and approved funds within 24-48 hours!Details
Read our Mozo Review to learn more about the Wisr Secured Car Loan
Monthly repayment5.35% p.a.5.65% p.a.based on $30,000
over 5 years
A quick and easy, 100% online application. No printing. No paper. No fuss. No monthly account keeping fees, no exit fees and no early repayment fees.Details
Read our Mozo Review to learn more about the OurMoneyMarket Car Loan
Car Loan - Excellent Credit
Monthly repayment6.39% p.a.to 17.49% p.a.6.39% p.a.to 21.0% p.a.based on $10,000
over 3 years
Be rewarded for your good credit history with low rates. Plus there are no ongoing fees and you can pay off your loan with no early repayment penalties. Simply apply online and get a quote in minutes.Details
Read our Mozo Review to learn more about the SocietyOne Car Loan - Excellent Credit
What exactly does ‘on-road’ costs mean?
The truths is, a lot of people are confused about this one. Sometimes dealers talk about on-road costs with ‘no more to pay’. But this is usually a promotion or an ongoing deal to attract more customers. So what you need to know is that for most ‘no more to pay’ offers, the actual on road costs are factored into the price of your new car. Some of these charges include:
- Dealer delivery charges This charge is set by the dealer's and covers the cost of delivering the car from the maker to you.
- Inspections Normally applying to used cars, an inspection by a third party ensures an honest examination of the vehicle you’re enquiring about. This is so that you’re not stuck with a car that’s less than worthy. If an inspection is not automatically offered, we advise that you arrange one yourself from an independent agent like NRMA.
- Car registration Buying your next car from a dealership, whether new or used, usually means that your car rego and **stamp duty is sorted for you. Buying from a private seller? Then not only do you need to process your own registration, but much much more. We’ll go into that a bit later.
**Stamp duty is when you pay the government a percentage of the value of the car at time of purchase. The lower the price, the lower the stamp duty!
- Insurance There’s a few you need to consider, but one that’s absolutely compulsory is your CTP insurance, also known as Compulsory Third Party insurance. Is your car less than 5 years old? Then you’ll also need a greenslip. Older than 5 years? Then you’ll need to get your car inspected for a blueslip. You may be saving money on the cost of the car, but with inspections, repairs and other maintenance, you’re likely to spend more time keeping it in good nick when buying a second hand car.
What about insuring your actual car? If you can’t afford to replace or repair it after an accident, then you’ll want to consider taking out separate car insurance on top of everything else. It’ll be worth it!
- Service Buying a fancy new car? Then your routine service costs are going to seem fancy also. And by fancy we mean costly. In contrast, the more affordable your new car, the more affordable your service costs will be. Makes sense! Keep an eye out for promotions that offer free service for the first year or more.
If your fantasy car has a sporty spoiler, white leather interior, and an extra shiny dash set of rims, then expect to pay extra on top of the sale of the car.
If your heart’s set on zooping it up, and we haven’t even begun to talk about the motor, then you could always add your extras to your car loan before driving away. When paid over the course of 3-5 years, you’ll soften the expensive shock, allowing you to pay it off over time.
Tips on buying a used car from a private seller
So if a new car depreciates the second you put pen to paper, then you may as well buy a second hand car, right? Why fork out for a new car when the value doesn’t hold!
Well, you can kiss the alluring ‘new-car’ smell goodbye, but you will be saving big bucks in the long run. As long as your next set of wheels runs super smooth. Because we don’t want any bumps on the road to take out your dodgy wheel alignment. We go into buying a used vehicle a little more to smooth over any confusion:
Car history report: means literally just that. If you’re buying from a private seller, you’ll need the VIN of the vehicle. Visit https://www.carhistory.com.au/ for a straightfoward check on the history of that individual car for a low cost. There you will be able to identify things like previous damage or financial liability which is really important, because you do not want to absorb someone else's debt! You want to ensure that with the transfer of the name and ownership of the vehicle to you, will provide you with a clean slate. Squeaky clean.
Paperwork: You’re going to need to see everything from rego papers to pink slip and driver’s license. It’s best to purchase a used car with at least 28 days validity when it comes to your rego and pink slip. This way you have enough time to sort out the name change/transfer and registration of your new car.
But don’t leave it too long! Some states only allow two weeks grace to transfer your new (used) car into your name. Going beyond this time and not registering your car properly with the RTA could have the boys and ladies in blue booking you for a hefty fine. It could be at least $500. Remember to ensure all your lights and mirrors are in working order or that hefty fine may quickly beef up by the hundreds.
You paying and driving away today? Don’t put foot to pedal until you purchase some insurance for the actual car over the phone. It’s ideal to cover your vehicle asap because as long as you’ve signed the back of the rego papers, the transferring process has thus begun and the car is officially your responsibility. Let’s hope you brought your mobile along!
Cost of car
Didn’t save enough to pay for your car in one lump sum? Then you will need to arrange for your own finance. Unlike a new or used car dealership where they can sometimes arrange in-house car loans, you will need to approach your own lender, apply for a car loan and either supply cash or direct deposit into the private seller’s bank account.
Remember, if it’s only a $5,000 car and you’ve got lots of space available on your credit card, 9 times out of ten, you won’t be able to use it. After all, how many private individuals do you know have their own mobile eftpos machine? Instead, you might have to opt for a $5,000 car loan.
Want a comprehensive car loan comparison? Stay with us a little longer and use our very handy car loan comparison calculator.
- Stamp duty: Just because it’s a private sale, doesn't mean you can avoid costs like stamp duty and compulsory insurances. No point in huffing about it either, we all have to pay it.
- Road side: She’ll be right mate. Ahhh. Nup. Whatever the situation, for a small monthly or annual fee, you’ll be glad you subscribed to a roadside assist service. Anyone from NRMA to Lube Mobil are reputable companies that will come out for anything from keys locked in to flat battery.
- Tyres: How’s the tread? Your seller may or may not be honest about when they last changed them, but for a few hundred dollars, a new set of wheels could be just the thing for making your car drive like a dream.
- ID: So, do the personal details on the rego papers match your seller’s details for their driver’s license? Don’t hand over any cash unless you’ve check with REVs first.
- Odometer: A six year old car with super low kilometers? Sounds fishy. Ask to see the log book and make sure the details measure up. If there isn’t a log book available or it appears as though the log book or the odometer has been tampered with, then we’re afraid the offer is too good to be true and you’re going to have to walk in the other direction.
Knowing how much you can repay is just a click away! Try Mozo’s car loan comparison calculator to see what best suits your budget.
^See information about the Mozo Experts Choice Car Loans Awards
Mozo provides general product information. We don't consider your personal objectives, financial situation or needs and we aren't recommending any specific product to you. You should make your own decision after reading the PDS or offer documentation, or seeking independent advice.
While we pride ourselves on covering a wide range of products, we don't cover every product in the market. If you decide to apply for a product through our website, you will be dealing directly with the provider of that product and not with Mozo.