Glossary

The everyday terms that come up when a car bought from a dealership goes wrong, in plain English. General information, not advice about your situation.

C

Compensation

Money for loss caused by a fault, on top of or instead of a repair, replacement or refund. For a car that may cover things like towing, a hire car or repairs you’ve already paid for. Whether it’s available depends on the fault and what the loss was.

Cooling-off period

A short window after signing in which a buyer may cancel a purchase. For cars it is set by state law rather than the consumer guarantees. In most states it doesn’t cover a car bought new from a dealership, and where it does apply it is short and often costs a fee to use.

D

Defect notice

A notice issued by police or a transport authority saying a car isn’t roadworthy and has to be fixed before it’s driven again. It’s about road safety, not consumer rights. A defect notice on a car you’ve just bought may still be evidence that the car wasn’t up to the standard it was sold at.

Deposit

Money paid to hold a car before the sale is completed. Whether a deposit can be refunded depends on the contract and the circumstances, and is separate from the consumer guarantees, which apply once the car has been sold.

E

Extended warranty

A warranty you pay extra for, from the manufacturer, the dealer or a third party, covering a period beyond the standard warranty. It adds to the rights you already had rather than replacing them, so having one, or not, doesn’t change them.

G

Guaranteed future value

A finance arrangement where the lender sets a minimum value for the car at the end of the term, which you can take by returning the car. It’s a finance product, not a return policy, and it doesn’t affect your rights if the car turns out to be faulty.

I

Independent dealer

A dealer that isn’t operating under a manufacturer’s franchise. brokencar only works on cars bought from a brand’s own dealership, so an independent yard is outside what we take on.

L

Lemon law

A term borrowed from the United States, where some states have laws that force a manufacturer to buy back a car with repeated defects. Australia has no lemon law by that name. The consumer guarantees do a similar job, and a car with the same fault coming back after repeated repairs may be treated as having one serious fault.

Letter of demand

A letter setting out what has gone wrong, which rights it relies on and what is being asked for, sent to the business responsible. It’s often the first formal step in a dispute.

Logbook servicing

Servicing done at the intervals and to the specification in the car’s service book. A complete service history helps show a car was looked after, which matters when a dealership questions how a fault came about. It doesn’t have to be done by the dealership.

M

Manufacturer dealership

A dealership that sells a brand’s cars under that brand’s franchise, such as a Toyota from a Toyota dealership. brokencar only works on cars bought this way, because the dealership and the manufacturer are both parties who may have to answer a claim.

N

Novated lease

A car lease arranged through your employer and paid from your salary. The car is still sold by a dealership, so the consumer guarantees still apply, though who makes the claim and what a refund looks like can be more involved.

P

Private sale

Buying a car from an individual rather than a business. The protections that come with buying from a dealership generally don’t apply, so your options are limited to what the seller told you and any state rules on roadworthiness. brokencar doesn’t take on private sales.

R

Recall

A manufacturer or regulator notice that a model has a safety defect and should be brought in for a free fix. A recall is strong evidence that a fault exists, and a car returned repeatedly for a recall issue that isn’t fixed may be on its way to a serious fault.

Refund

Getting your money back and returning the car. A refund may be available for a serious fault, and the amount can depend on how long you’ve had the car and the kilometres it has done.

Repair

Fixing the fault. For a smaller fault the dealership may be entitled to choose this, and it has to be done within a reasonable time and free of charge. Repeated repairs that don’t fix the problem can change the picture.

Replacement

A car of the same type and similar value in place of the faulty one. It may be an option for a serious fault, where the choice between a refund and a replacement may be the buyer’s.

S

Service bulletin

A notice from a manufacturer to its dealerships about a known problem and how to fix it. Not a recall, and often not told to owners. If one exists for your fault, it can be useful evidence that the problem is known.

T

Trade-in

A car you hand to the dealership as part payment for another. If the new car is later refunded, what happens to the trade-in can depend on whether it has already been sold on.

W

Written warranty

A promise from the manufacturer or dealer, for a period and on conditions they set. It is separate from the consumer guarantees, which continue to apply regardless of whether the warranty has expired or its conditions were met.