Used cars change hands every day; some from the owner's driveway in a private sale, while others are driven from dealers' forecourts. For those who have gone the private sale route, the decision to buy will likely have been made with one eye on the price. But while it may seem that these buyers might have a bargain initially, there are far less guarantees when buying a car privately from another individual.

Will the original seller provide you with a warranty should a component fail in the subsequent few weeks of your ownership? What about road-tax or MOT? Can the owner prove they are legally entitled to sell the vehicle, or that the vehicle hasn't been written off previously? These are just some of the questions you should be asking yourself - and the seller - before entering into a private sale, as to do otherwise could be leaving yourself open to trouble later down the road.

However, buying a car from a dealership can bypass many of the pitfalls associated with buying privately. For starters, any car held in dealer stock will already have been subject to a full HPI check and a full AA or RAC inspection, which would highlight any outstanding finance on the vehicle or if the car has been written off previously by an insurance company and subsequently repaired, or any mechanical defects; thus providing peace of mind to any potential buyer that the car can be legally sold and is in a roadworthy condition.

Many dealerships are interlinked, so if your local branch doesn't have the car you want in it's current inventory there's a good chance that another branch will. By way of a quick computer check, a salesperson can find all cars matching your desired requirements - make, model, colour, included extras, etc - in other branches and can arrange for you to view the vehicle at the holding branch. In some cases, the car can even be transferred to your local branch, saving you the hassle of travelling - especially if your dream car is in a branch at the other end of the country!

When buying your car from a dealer, you'll also be protected by an included warranty on your vehicle which will cover your new purchase from mechanical failure for a specified period of time. The duration of warranties offered differ between dealers, but typically run between three months and one year, and these warranties can be extended to cover a longer period of time. What's more, many dealers will also give your new car a complimentary pre-delivery service so you can be sure the car will be in tip-top condition when it comes to driving it from the forecourt.

Dealers will also allow you to carry out any checks on the car yourself. Although dealers perform their own HPI checks, there's nothing to stop you doing one of your own, or having a mechanic check over the car. Most dealers also invite you to take the car for a test drive so you can get a feel for the car and to help spot any potential issues the car may have; things which a private seller may not be so keen on you doing, just in case there's something untoward lurking under the bonnet they'd rather you didn't know about!

Buying a car privately can be a long, frustrating and potentially costly process, so you need to ask yourself whether it is really worth all the hassle. After all, it might be slightly cheaper but your choice may be limited and there's no comeback if the car later proves to be unreliable. Going through a reputable dealer who specialises in used cars can help negate the potential pitfalls of buying privately so when it’s time to change your car, give yourself the best chance of finding one you can be happy with.

Steps by step process to buying a car

1. Spend the weekend visiting car yards and dealerships, work out what type of car is going to suit your needs.  (MOST IMPORTANT don’t buy something on impulse – don’t buy a car that weekend - you will pay way too much. If financing you might be eligiable for national fleet discount.
    
   
2. Research price on internet and newspapers (Internet is an ideal medium as you can search on price low to high) recommended sites are www.carsales.com.au and www.redbook.com.au
   
   
3. Pick out a list of cars you would like to test drive don’t limit yourself to private. Dealers sell cars cheap sometimes just to turn them over.  Dealers work on floor plans once they have a car for more than 28 days they pay a higher amount of interest.  To insure this doesn’t happen they remove the profit and sometimes even take a loss.
    
   
4. Find the vehicle you like and negotiate on price before you have it checked out mechanically.  Once you have had the car tested you might as well have agreed to buy it.  Find a happy medium on price but beware if you try to negotiate too hard someone else may purchase the car in the interim.  You would be surprised how often this happens.
    
   
5. Don’t waste money on getting a RACV inspection or an inspection where the mechanic comes to the car.  The mechanical inspection is only ever as good as the mechanic doing the test.   Mechanics that do RWC for dealers a generally the best, they are cheap and know the cars inside out.  Even if you have your own mechanic find a really busy dealer mechanic, dealers use them for a reason.
    
   
6. If you’re satisfied with the mechanics findings contact the government’s local traffic authority to establish their specific process.  Every state in Australia has a different process including forms, roadworthy requirements for example. It’s important to ensure the vehicle is free from any finance before any large amounts of money change hands.