The Most Important Insiders Tip – How Not to Buy a Lemon


How not to buy a Lemon

The Most Important Insiders Tip – How Not to Buy a Lemon.

Buying a used car? Or perhaps, considering an offer that sounds too good to be true? No matter the industry, there are some crafty people out there who have countless ways to bypass legal procedures. In autos, for example, they fit parts from statutory write-offs to a stolen vehicle’s VIN, making the completed vehicle untraceable. That’s why it’s essential to educate yourself on how scammers work and spare yourself of future trouble.

 

The insider’s tip

As perpetrators get more clever over the years, consumers might get caught unaware of the various forms of illegal practices now in the automotive industry. In effect, they fall victims to these practices. So here I’ll be giving you some of the most important insider’s tip on how not to buy a lemon.

 

1.      Know your rights and responsibilities.

      1. Intentionally ask your seller (in black and white) if the vehicle has ever been written-off. In that way, they’ll have no choice but to divulge the truth.
      2. Obtain legal advice in case you just found out that the vehicle you currently own has been written-off. In Victoria, victims are encouraged to approach Consumer Affairs Victoria.
      3. In case your vehicle became a write-off while under your ownership, you must register it under the Write-off Vehicle Register (WOVR) within the time limit allowed by your state/territory. If insured the insurance company will take care of this. Or if presented to the wreckers they will also. That is if your vehicle or trailer:
        • Has a Gross Vehicle Mass (GVM) or an Aggregate Trailer Mass (ATM) of up to 4.5 tonnes, and
        • Is less than 15 years old from its manufacturing date

 

2.      Acquire from the seller all relevant documents.

Especially those containing the vehicle’s damage and repair records (as applicable). After obtaining these, hire a third-party expert to physically inspect the vehicle and reveal any undisclosed damage.

 

3.      Thoroughly check the vehicle’s records

Look for all possible anomalies the vehicle may have. For instance, undisclosed damages, debts, adulterated odometers or others. Fortunately, there are platforms that provide these details for each specific Australian vehicle. You only have to enter the Vehicle Identification Number (VIN) in either or all these platforms:

a. The National register – Personal Property Securities Register (PPSR)

Basically, it gives you the vehicle’s technical data aside from answering these questions:

        • Does someone else have the right to claim possession over the vehicle?
        • Is the vehicle written-off?
        • Is the vehicle stolen?

b. State’s or Territory’s register

Just visit the website of the state/territory and then type “check vehicle registration” on the search bar.

c. Third-party registers

Well sometimes entries in the WOVR can be delayed, hence likely affecting the PPSR. So an independent check would be helpful. There’s no harm in double (or triple) checking, is there? Especially if it costs just a tiny chunk of what you have to pay for when the consequences of buying a lemon happen.

For this matter I highly recommend CarHistory. They use several reliable sources in addition to the PPSR and quickly generate a more detailed report on a vehicle, regardless of where in Australia it was registered.

Now in case, you’re not aware of what write-off vehicles are, or of the problems looming around write-offs, here’s a brief explanation:

 

What is a write-off vehicle?

Assessors declare a vehicle as a “write-off” if it has undergone severe damage to the point that the cost of repairing it is more than it will be worth after repair. There are two general types of write-off vehicles based on how much they can be salvaged.

 

Repairable write-offs

These vehicles, as the name suggests, maybe repaired but at a greater cost compared to how much they would be worth after repair. In short, it’s a losing game (financially, that is).

But since these are technically repairable, you can have ‘em inspected, repaired and re-registered for use. How? Choose below your relevant state/territory since they differ in the process and document requirements.

 

ACT NT TAS
NSW – light vehicles QLD VIC
NSW – heavy vehicles SA WA

 

  • Light vehicles are either motor vehicles with a Gross Vehicle Mass (GVM) of ≤4.5t, or trailers with an Aggregate Trailer Mass (ATM) of >4.5t
  • Heavy vehicles are either motor vehicles with a GVM of >4.5t or trailers with an ATM of >4.5t

 

Statutory write-offs

These are the worst-case damaged vehicles as no amount of repair can get them back to a safe and usable condition anymore. Although of course, it is understandable that some parts of the vehicle may still be re-used. And this is where problems commonly creep in.

 

How is a vehicle declared as a write-off and what happens after?

The assessor (i.e. insurance company, or another authorised person as allowed by the state or territory) determines whether your vehicle is a repairable or statutory write-off, based on the damage it has incurred. Several factors are considered, but the general categories include fire damage, structural damage, water damage and stripping damage.

  • If the damage is minor, your insurance company can either pay to fix your vehicle or declare it as a repairable write-off.
  • Otherwise, the assessor will declare your vehicle as a statutory write-off.
    1. If declared as a repairable write-off, your vehicle’s registration plate will be removed.
        • Should you want to get your vehicle back, you must hire a licenced repairer or dealer to inspect and repair your vehicle. After that, you may obtain your VIV and roadworthiness certificates. Finally, register the vehicle as an inspected repairable write-off.
        • Alternately, your vehicle may be auctioned off as a repairable write-off but this is legal in some Australian states/territories only. Conditions also apply.
    2. Statutory write-offs, on the other hand, proceed by the insurance company hiring professionals to completely destruct your vehicle. Your role here is to hand over all relevant documents to your insurance company before saying hooroo to your vehicle. Alternatively, you may opt to recover some salvageable parts.

 

How damages are measured

The National Motor Vehicle Theft Monitoring Council (NMVTMC) provides a straightforward guide to help assessors determine the extent of damage a vehicle has gotten. This is called the Damage Assessment Criteria. Effectively through this material, assessors will be able to identify whether a vehicle is a write-off or not. And if it is, what type of write-off applies.

By the way, the NMVTMC separated these criteria per vehicle condition. So as to not leave you further out in the dark, these are the links to the latest Damage Assessment Criteria documents so far:

 

The illegal side of write-off vehicles

Case 1: Untraceable converted vehicles

As introduced earlier, some people put together parts of different write-offs and top it off with a VIN from a stolen vehicle. Specifically, in the RV world, they fit motorhome bodies to vehicles with a different VIN. As a result, the vehicle becomes untraceable because the conversion done to it is not reflected in the VIN.

 

Case 2: Selling of stolen vehicles

Similar to case 1, this particular case involves fitting a write-off vehicle’s VIN or compliance plate to a stolen vehicle. In this way, perpetrators get to illegally sell stolen vehicles.

 

Case 3: Repairing write-offs using stolen parts

This is an incident that involves repair workshops. So make sure that the repair workshop you hire is one that you fully trust. And do select from a list of licenced and recognised workshops.

 

Case 4: Auctioned write-offs

Insiders in the auto industry are well aware that organised crime bodies illegally auction vehicles that were already written-off by insurance companies. One way is by selling vehicles that fit either of the cases previously mentioned. Another is by just doing whatever is outside the state’s or territory’s restrictions.

Case 5: Rolled-back odometers

Although not exclusive to write-off vehicles, this case is notorious for successfully remaining right under the buyer’s nose. Specifically speaking, a seller claims a vehicle to have an amount of mileage that’s much less than it actually has.

How? I’ll leave that for your discovery! The point is, lawbreakers always have ways.

 

How do these problems affect you?

As an owner of a vehicle that’s built or sold illegally, you may either lose your vehicle or be penalised. Remember,

Ignorance of  law excuses no one.

Meanwhile, as a buyer, you’d be getting much less than what you are supposed to receive. Just imagine how much extra you will have to shell out for buying a vehicle with a performance that’s not guaranteed.

And either as an owner or as a buyer, safety risk! Any conversion or repair is done to a vehicle without proper inspection and certification by experts only puts your safety in jeopardy.

 

Conclusion

As saddening as the truth might have been on the illegal practices within the auto industry, here’s what you can do as a consumer to avoid buying a lemon:

  • Be vigilant of such activities,
  • Don’t easily trust too-good-to-be-true vehicle offers, and
  • Check ahead the VIN of your prospect vehicle

Finally, it doesn’t hurt to ask. Should you still feel uneasy about buying a certain vehicle, you may ask me for tips and tricks specific to your case. After all, it always pays to look before you leap.

 

Darren

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