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Buying a second-hand car can be an exciting experience but — if you end up spending thousands on a lemon — a potentially distressing one too.

That’s why you need to make every effort to ensure the condition of the car reflects the seller’s asking price — and that its maintenance costs won’t end up burning a hole in your pocket.

This guide highlights some of the things you should check when shopping for a used car. In most instances, all you’ll need are your eyes or ears.

(As a final step, and even if you think you’re quite savvy when it comes to cars, always get the car inspected by an independent mechanic; the relatively small cost could save you a lot of financial pain.)

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Confirm the owner

It’s important to confirm the seller is the person who owns of the car.

While you won’t be charged for unknowingly buying a stolen car, the car my be repossessed and returned to its owner or their insurance company or finance company.

You could be left with nothing to show for the thousands of dollars you’ve spent.

You can confirm the owner of the car by doing a Personal Property Securities Register (PPSR) search (previously known as a VIN check).

The search provides, among other things, a description of the car and its registration plate.

By comparing this information with the seller’s current registration papers (which includes their name and address), you can ensure the registration plate number, VIN, engine or chassis number match.

As an extra precaution, you may wish to check the vehicle identification number (VIN) has not been tampered with in any way.

As well as helping you confirm the car’s owner, a PPSR search will reveal whether there’s any finance still owing on the car.

If you buy a car that’s secured against an outstanding loan and the previous owner stop repaying the loan, the lender could repossess your car.

Check for accident damage

No one wants to buy a lemon — a defective vehicle — and (excuse the mixed metaphors) end up with egg on their face.

First and foremost, you’ll want to find out whether the car has been in an accident and, if so, how severe it was.

While a PPSR search won’t reveal each and every accident a car’s been in, it will tell you whether it’s ever been written off.

Some repairable write-offs are fixed, inspected and re-registered and re-sold — but the standard of repairs may be poor, putting you at risk.

By ordering an inspection of the car by an independent mechanic, you should be able to find out whether the car has had any accident repairs.

Many accidents are minor, and the damage is repaired to a high standard, so don’t rule out an ‘accident car’.

At the very least, the seller should provide you with a valid roadworthy certificate (also known as a safety certificate).

Look under the bonnet

Any build up of dirt and road grime that appears caked on is often a sign of fluid leaks.

These could be leaks in the power-steering pump, radiator, hoses, transmission, oil pan, engine seals, or oil-cooler lines.

As well as the engine, these fluids leak onto the ground beneath the car, leaving more obvious tell-tale signs.

Coolant leaks leave a light-coloured residue or stain, power-steering fluid has a reddish colour, while oil is dark and greasy.

White smoke in a car’s exhaust can be a sign its coolant had drained into its combustion chamber — a serious problem.

These leaks and white smoke are usually signs of wear and tear and/or poor maintenance.

Used car buyers should expect signs of wear and tear, which typically reflect the vehicle’s age.

Excessive wear and tear may warrant a price decrease, assuming you don’t simply walk away.

Inspect the panels and paint

Ideally, body panels on first inspection should be free of dents, dings, rust, chips, and oxidation.

Sometimes, though, signs of past accidents are less than obvious.

They include inconsistently wide gaps between body panels (most notably between the bonnet and front bumper).

Dimpled or blistered paint is usually a symptom of rust that has spread from the inside of the panels, which most manufacturers do not paint.

This rust often results from the owner not washing the vehicle regularly enough, a carelessness that may bode ill for other parts of the car.

Doors should swing freely, close securely and form a weatherproof seal. If they sag on their hinges, chances are the car’s been poorly repaired following an accident.

Examine the tyres

When inspecting the tyres, look for a legal minimum tread of 1.5mm across the face of the contact surface.

Excessive wear can be indicative of poor driving practices and warrants you having a closer look at the car’s other components.

Uneven wear on the front tyres is suggestive of misaligned wheels while uneven wear on the back tyres may be due to an irreparably bent or warped chassis.

Tread crowning (wear that is heavier around the edges of the tread surface) and tread cupping (wear that is heavier toward the centreline of tyres) are caused by under-inflated and over-inflated tyres respectively.

Test the transmission

A car’s transmission makes sure the right amount of power goes to your wheels to drive at a given speed.

If the transmission isn’t working, the car isn’t going anywhere.

Needless to say, it’s an important component that must remain in good working order.

Signs of transmission trouble include leaking transmission fluid, which has a reddish colour.

Excessively dirty fluid may indicate poor maintenance and can cause automatic vehicles to perform sluggishly.

When you press down on the clutch pedal of a manual vehicle, you should feel a consistent pressure on your foot through the full length of the pedal stroke; a soft or spongy clutch pedal can be due to damage or leaking fluid lines.

If you notice a significant lapse between moving the gear selector in an automatic vehicle and the transmission engaging, it’s likely got a problem.

While driving, gear changes should be smooth — any jerky shifts are a sign of a weakening transmission.

With a manual car in neutral and its handbrake on, test its clutch by pressing the pedal down and holding it down for a couple of seconds before releasing. Do this two or three times.

If you hear any squeals or whines when the clutch is engaged, you’ll want to inspect the transmission more carefully.

As you can see, there are inherent risks in purchasing a second-hand car.

But by checking the seller’s credentials, examining the car carefully and getting a qualified mechanic to inspect it too, you’ll minimise the likelihood of you ending up with a dud.

See all of Budget Direct's car-buying guides