Buyer beware: security interests and used car sales

When it comes to buying a used car, there are some checks that immediately come to mind. You might look at the car’s age, history, fuel consumption, and overall condition. But there’s one more thing that isn’t as obvious: checking if the car has a security interest against it. Let’s dive in.

A security interest is an interest in personal property taken to secure payment or another obligation. For example, a bank may use a car as security to grant a loan to someone who doesn’t have the upfront funds to buy something. The two parties write up a contract and make an agreement that if the borrower can’t repay the loan, the bank can use the car as collateral to make up the debt.

It’s important to know if a car has a security interest on it, because if it does, it could be repossessed from you, even though you’ve paid for it.

Running a search is easy and can be done in just a few simple steps. You don’t need to make an account to run a search.

1. Head to PPSR Car Check.
2. Enter the Vehicle Identification Number (VIN) of the car you intend to buy.
3. Enter your email address.
4. Pay for your search using a credit or debit card.

It only costs $2 to run the search online, or $7 over the phone. After you run the search, you’ll receive a search certificate to use as a legal record of your results. In addition to whether the car has security against it, the search may also include information about the vehicle’s:

• make, model and colour
• written off status
• stolen status.

Ideally, run the search as close to the time of purchase as possible, either the day before you intend to buy the car, or on the day you buy. This helps to ensure you get the most up-to-date information available.

It’s not just cars that can be searched on the PPSR. You can also look up motorbikes, caravans, horse trailers, forklifts, trucks, buses and a whole lot more. 

To learn more about how to run a search and understand the results, visit www.ppsr.gov.au/searching.