Things you Need to Know

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Frequently asked questions

This HAS to be the most nerve wracking way to buy a car. You have No Rights and No Protection. You don’t know the history of the car or the seller. Was it in an accident or even a repaired write off car? Is it still under finance? Was it a car caught in a flood and fixed up? After the purchase you are on your own – all problems are yours. Interestingly from my observation of cars offered on line they are not a lot if any cheaper than offered by a Licensed Dealer offering you all legal protections and warranties.

If it was my family I was putting in a car I would want to sleep well at night knowing the car was safe and I had protection.

Just a bit about cars under finance. If a car is under finance in say Queensland, bought to WA, reregistered and then sold without the financed company getting their money that finance company can reposess the car from you. If this ever occurred via a dealer (they buy all the time) then legally the dealer is caught not you. This safety net is there to protect you the consumer but only when buying from a dealer. Brokerage WA will NOT soiurce a car from a private seller. It MUST go through a dealer to get thoroughly checked and to protect our clients.

Next to buying this just as scary when selling privately. The people coming to your home are not known to you. Who says they are not just checking you out for later opportunities???

Next is your time. How important is your family and leisure time? Getting a car ready for sale, preparing the adverts, placing the adverts, updating the adverts and then waiting for the phone to ring – all takes time – and in some cases weeks of unproductive lost time. Brokers WA can offer your car to dealers eager to own it and quality stock is hard to find. We can gewt you a good price quickly.

THEN what about settlement? How do you get paid? Cash? Cheque, Postal order or EFT? Got the money but not cleared funds. When do you release the car? They want it NOW and you still don’t have your money. Good luck with this as it can unravel quickly.

This depends. Now I am not hedging my bets here however in the simplest terms; if you have signed and unconditional contacts, given a deposit, received a copy of the contract accepted by the dealer it is LEGALLY enforceable. In Western Australia there are NO Cooling Off laws unless you signed as a result of being canvassed for the sale at your home – door to door sales. If you are in an Unconditional Contract to Buy then penalties can be applied – in Western Australia that can be up to 15% of the purchase price of the car. THINK and BE SURE before signing.

IF your Contract has CONDITIONS placed on it as part of your sale then ALL conditions must be met for the Contract to be enforceable. When buying on Contract make sure you make any additional side deals or conditions – from a set of floor mats at No Charge to Delivery on or before a set date – are in writing and initialed by both you and the dealer accepting the Contract. Conditions are good because everyone is clear on intent.

Word of Warning on this one. If you do a deal with Dealer A and then AFTER the contract is signed Dealer B offers you a “better deal” it is too late.   I have seen these get very ugly when this occurs and NOBODY is happy in the end. A Deal is Done when it is signed, unconditional, deposit paid and copy of contract provided. STOP there.

NO. If you are offered a “deal on a car provided you take finance through us” at a dealer this is Third Line Forcing and illegal. Even if in the normal course of business you make application you can pay using funds from another source without signing finance contracts. Always sign finance contracts “on the day of delivery” after inspecting your new car. Once you sign that is like money changed hands.

By the way. ALWAYS be aware of EXACTLY what you are signing. If in doubt, ask.

Yes. Legally you cannot be forced to take finance from any source. Even if you have made an application but not yet signed you can make alternative arrangement, right up to the time you settle the transaction and take delivery.

If you want to know about our full range of Finance Services please click on the link Provident Lending and Business Solutions. We collaborate with Provident Lending and Business Solutions who hold the Australian Credit License.

A car represents the second largest purchase for most people, after their home loan. Never before has it been as important that you do not let emotion and excitement lead you to a loan on a car you can’t pay for. Brokerage WA will always ensure you take your time in making this significant decision; remember we want to help you for many years to come.

Sure can – that is the bulk of what we do. Brokerage WA is licensed as Finance Brokers and can provide highly competitive funding for your purchase however our first priority is right car, right deal, quality service.

Legally if you own the car (paid unencumbered cash) then no – however not a really good idea. Accidents rarely come in under $4,000 and can quickly escalate up to $10,000 plus before write off is a consideration. IF your car is UNDER FINANCE it MUST be Insured and the financier noted on the insurance policy.

No but can be wise to do so. I drive a Calais V VF Sedan. Possibly one of the best cars I have owned. At 41,000 kms the engine suddenly and without warning started up a death rattle. Rare as rare event for this model. The dealer who sold the car has also done the servicing. Without question Holden considered the economics of it and REPLACED the engine. They could have fixed it up however that would have taken time for me and them. The cost was about the same so with a solid service history a new engine was authortised without question or argument. I can tell you some stories that will curl your hair about “cheap servicing” – maybe over a coffee one day.

The short answer is “Yes because of the knowledge and experience we have had in buying and selling cars”. The objective of every negotiation is to arrive at a point where the client is happy to do a deal and the seller is happy to accept the deal. At the same time it is likely both buyer and seller may think “there was still something left”. That is probably the best deal outcome. Our job at Brokerage WA is to ensure you get more that just a good financial deal. Right car – make, model, colour, – right terms – timing, delivery – right dealer – not too far from your home or work.

Experience and Knowledge. At Brokerage WA Principal Broker, Tony Carter has worked in senior management of the motor industry for over 40 years, from rookie sales through all levels of management and to ownership/management of some large dealerships.

Time. Your time is important. At Brokerage WA we do the leg work for you. Depending on case, you may never step foot into a car dealer premises or have to make a call. We do the lot.

Stress Free. Working with Brokerage WA is is all about you. We do not have sales targets to meet and EVERY deal we broker is what we focus on. Never again will you have the angst of, which dealer, salersperson relationship, trust issues, decision issues.

  • Identify & Clarify your needs and capacity. This is MOST IMOPORTANT to us. We have to know what you want exactly, what you will use it for, what you want it to do, when you want it, your capacity to pay for it and preferred dealers – or not.
  • Locate the right dealer/s with the right car for you.
  • Tender out the oppoprtunity to the selected suppplying dealer/s
  • Negotiate final deal and conditions.
  • Arrange any accessories etc that you want in addition to the car.
  • Arrange finance – Brokerage WA can do this or ensure the arrangements you have in place are best available.
  • Coordinate the delivery process.

Like everyone in business we have to pay the bills so yes we do receive a fee for our service. At Brokerage WA our preference is for you as our customer to pay that fee however if you want it all bundled into to one transactiuon we can charge the dealer, with your permission.

You know all commissions we receive relating to Car Broking – transparency is the only way we can work.

There are no set Broker Fees, however a basic Car Broker fee, through Brokerage WA is $660.

We cannot say what others charge however we are aware of different business models whereby the broker is paid by the dealer and that figure is unknown to the client.

The fees charged by Brokerage WA are based on the philosophy that we want you to work with us again and again as well as willingly refer your family and work colleagues to our service. Great service at reasonable cost is our belief.

Some transactions are complex involving numerous choices, trade-in management and/or the need to expand the search for the vehicle. In these cases we charge an extra negotiated fee.

Very limited risk.

Car Brokers never directly handle your money. The “transaction” is between you and the selected dealer in exchange for the car of your choice.

The “broker fee” is paid after the transaction settles or the work contracted to be done is complete. No agreed outcome, no fee.
You don’t like the broker. While it is desirable to like the person who is working for you, it is about doing business with them, not making lifetime friends. Obviously a positive relationship is what you want however our advice is; if you don’t feel right or simply do not like the broker’s personality do not work with that person.

Stamp Duty is a State Government charge and works on the price of the car on a sliding scale. See our link to the Stamp Duty Calculator.

In New Car Sales Stamp Duty is included in the price because the dealer has to license the car for you and it is part of that process.

In Used Car Sales (and Demonstrator)   the car is already licensed at delivery point so Stamp Duty is charged AFTER the sale. You are responsible to make the correct payment to the Government within 14 Days.

It is possible to include Stamp Duty in your negotiated price and as it can amount to thousands of dollars this may be how you want it done. Brokers WA will check this with you prior to negotiating your deal.

In Western Australia there is NO COOLING OFF period unless the sale was done under “door to door” sales.  As cars are a big ticket price door to door simply does not occur.

Once we tender out your needs, you accept the tendered price and sign a Contract to Buy a Motor Vehicle with the dealer, and it is accepted in writing by the dealer; other than completing any conditions of sale (such as subject to finance) the deal is unconditional and firm. There is no “changing the mind” or “getting a better deal”.

The Contract to Buy has penalties listed of up to 15% of the purchase price for failure to complete a firm and unconditional deal. The only time this will impact anyone is where the buyer repudiates a legally binding contract. Even then it is likely to be negotiated.

If your finance is rejected after making a full and honest attempt to obtain finance then yes.

If you do not tell the truth to “get finance rejected” then there is likley going to be a fight at some level.

Remember that when applying for finance everything is recorded and may impact any future application. E.g. If you get “rejected” by a financier then apply via another dealer to another financier the second financier will see your application listed and ask “why didn’t this proceed?”. This may bring up differences between the two applications and place your overall credit score/rating at risk.
Your finance score/rating is exceptionally important and you should protect it at all costs.

When the offer is made by dealers it will be on a New Car – most likely a selected model of new car, one they want to move in volume – and generally involve the distributor or factory behind that brand. They work together to bring and offer to market that works like this:

Car is sold at recommended retail price.  NO Discount.

The dealers uses their margin in the car and the manufacturer uses their wholesale margin to offset the real cost of the interest – they pay the finance company the difference between the “real rate” and the “advertised rate”. EG: If they have a base rate of say 4.5% and the offer 1% interest on a special deal then the dealer/manufacturer need to pay the difference over the term of the loan – it is paid upfront effectively giving the finance company an early payment of their interest. You will also find the period of the loan is restricted to maximum 3 years – this keeps the dealer/manufacturer payment to a minimum. You are also restricted to the finance company selected by the dealer and manufacturer.

The object of the offer is to attract people to specific cars because of the “so called” low interest rate, but remember to get the special low rate you must pay retail price for the car.

There is absolutely nothing wrong or illegal with this however it does restrict you and if you want to break away from the offered deal then all special offers are off and you start from the beginning. It can be hard going.

Is there a better way?

Yes there is.

Brokerage WA prefers to help their clients by keeping the various elements of the deal separated – this avoids confusion and allows us to negotiate the best possible deal on the car, the trade-in, the accessories and the finance.

In the end always remember this:

There is a profit in all aspects in car dealing;

  • The New Car
  • The Finance
  • The Insurances
  • They Accessories & Car Care
  • The trade-in when sold.

If you add all this potential profit up it comes to a number – actual numbers vary by car and deal however the “pool of profit” is the maximum that can be made. How that is cut up can vary but in the end it comes down to how much the dealer wants to keep and how well you can break down each of the profit areas to get the best deal.

By engaging Brokerage WA we can identify the best way for you to get the best new car deal and MOST LIKELY that will not be advertised by dealers.

 

 

 

It is the value in the car that you own – either by way of Deposit or Trade-In Value (after payout if there is one). The greater the equity, the easier you will find repayment, shorter term and less overall cost. Some dealers and brokers may encourage you to borrow 100% – and that is ok if you have clear capacity to make repayments with no potential downturn in your income. Brokerage WA will encourage you to have equity however this is your decision and will always represent your wishes.

If you need to borrow to buy a car; rather than look at the “total $$ cost of car”, consider the monthly payment and your capacity to meet the payment. Brokerage WA will work through your assets & liabilities and your income and expenditure so you can see exactly what capacity you have. Once we know the limits you are comfortable with we can then help you Locate Your New Car.

A Secured Loan is where the financier (bank or finance company) take a mortgage or “title” over the asset – in this case a car. As they have the security of ownership in case of default. It can be expected interest rates are lower provided of course your own credit history shows you to be a person who repays loans in full and on time.

As a secured lender on the car, should you fail to make repayments the financier can repossess the car.

An Unsecured Loan sometimes known as a “personal loan” is given to people who generally have excellent credit history – not security is taken over the asset however the amount than can be borrowed is limited. Interest rates can be higher because of the lack of security over an asset.

Dealers are generally linked to a financier as a result of their borrowings for all their stock. In exchange they offer that financiers loans. This is a source of income to the dealer and it either partially covers or exceeds the cost they have in interest for their sock holding. Remember it is part of the sale and the role of a dealer is to sell their car, their accessories and their financiers finance. They can only offer finance on the car they sell. Brokerage WA offers a selection of financiers and in doing so our objective is to keep your cost down by obtaining the best possible deal on the day.

Remember, dealer finance is convenient however it may also be wrapped up in the emotion of buying a new car. Take your time and consider your options. Keep car deal, accessories, extras ands can finance operate. It may take a bit more time however in the end you will save significant money.

If you can claim a tax deduction for the repayments on your car, then yes. A Lease is a rental agreement for an agreed time however at the end of therm ownership of the car is with the Leasing Company. At the end the Lease is terminated, the car is sold by the leasing company and provided there is not shortfall between the final “residual value” and the sale value you effectively walk away from the car and the transaction. You may be able to buy the car off the leasing company however that is their option. Remember, if the car value is higher than the residual value the potential provide is theirs not yours.

Under a Lease the finance company provide the Lease are not obligated to rebate any unused portion of the loan should you terminate prior to the end of agreed term. EG if payments are $800 per month for 48 months then you must make all 48 payments even if you wish to end contract at say 36 months.

This is different to a Consumer Mortgage or Chattel Mortgage agreement. Under these there is a statutory rebate applied to ensure you only pay interest on the time the money was on loan. In other worlds, you get a rebate on the total interest if terminated earlier. Once the payout is made on consumer Mortgage, you own the car.

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