In a private sale it is your responsibility to ensure the car you buy is not stolen or has finance outstanding on it. If a private seller takes your money and has failed to pay off any outstanding loans on the vehicle it may be repossessed from you.

And even if the private seller is aware of a mechanical defect in the vehicle for sale they are under no legal obligation to disclose it.
Ask the seller to produce identification to prove that he or she is the owner of the vehicle as shown on the registration papers. Just being the owner’s husband or wife isn’t enough - the seller should be the person named as owner on the papers, and if it’s a husband and wife then both parties must transfer ownership.

Compare the registration papers with other documents such as the Compulsory Third Party (CTP) insurance certificate and any other paperwork that may indicate who is the owner of the vehicle. If the names don’t correspond you have every right to be suspicious. For further verification of registration details including ownership ask to see the present owner’s receipt from when the vehicle was purchased. If available it can provide valuable information, possibly including the odometer reading at the time the vehicle was last sold.

Then ring REVS, a free service provided by the NSW Department of Fair Trading which can tell you if the car you're thinking of buying is carrying a debt and could be repossessed. REVS can be contacted directly, weekdays from 8:30am to 5:00pm and Saturdays 9am to 2pm (excludes Sundays and public holidays).
Telephone 13 32 20
Sydney Fax 02 9891 5135
Newcastle 0249 29 4671
Technical Enquiries: 9895 2707
Alternatively, contact REVS at www.revs.nsw.gov.au.

REVS can also tell you if the vehicle is reported to the Police as stolen, de-registered due to unpaid traffic fines or recorded with the RTA as a write-off or a vehicle of interest. However, REVS does not guarantee Police or RTA information. If REVS gives the vehicle the OK, you can get a REVS Certificate that gives you legal protection against repossession by a financier due to a previous owner's unpaid debt.

In a private sale the vendor is legally obligated when showing the vehicle to produce a Certificate of Inspection that has been issued within the past month. If you purchase the vehicle, this Certificate of Inspection should be given to you when you take possession.

Since the early 1970’s all motor vehicles sold in Australia must comply with Australian Design Rules. If the vehicle you intend to purchase is not Australian-made, check to ensure it has a metal Australian Design Rules compliance plate affixed, usually in the engine bay. Even if the vehicle is Australian-made it is a wise idea to ensure there is a compliance plate affixed and that its details correspond with information shown on the RTA registration form.
(If there is no compliance plate mounted on the vehicle you should ensure that it has RTA approval for registration.)

Next, contact the nearest RTA Motor Registry Office to make sure there are no outstanding traffic fines or defect notices on the vehicle. The RTA’s telephone number throughout NSW is 132 213.

If you have an accident in a vehicle that has been listed as unroadworthy you could lose part or all of your insurance cover. If outstanding traffic fines haven’t been settled the registration may have been cancelled.

It also makes sense to check that the numbers on the engine and chassis match the numbers in the registration papers and owner’s handbook, if available. Vehicles displaying conflicting numbers may not be registrable.

Finally, have the car looked over carefully by an expert who can tell you the mechanical condition of the vehicle and advise you if it has been in a serious smash. This inspection can also give you an indication if the odometer reading and the general condition of the vehicle are compatible.

Beware the “backyarder”
You should always be on the lookout for unlicensed “backyard” dealers that pose as private sellers.
In most cases the unsuspecting buyers have little hope of gaining compensation once they find out they’ve been duped. There is no protection against unlicensed dealers from the State Government’s Dealers Compensation Fund.

Car markets
Car market operators have few responsibilities to their purchasers and can avoid title guarantees and statutory warranties by simply putting a notice on each vehicle stating that no guarantee or warranty applies.

These often temporary setups have become an outlet for the backyard operators to peddle their wares, disposing of vehicles that have been poorly looked after or badly repaired. The unfortunate purchaser from such a market has no protection from the possibility that the vehicle they’ve bought is substandard, defective, or is even one of the $1 billion worth of cars stolen every year.

Car auctions
Auctions may be another way to save money, but again they have their own risks. Buyers have no guarantee of title unless the auctioneer is a licensed motor dealer, nor do they have any warranty protection. It may be the case that a test drive is not possible on a vehicle that’s being auctioned. What you see is what you get, and let the buyer beware.