Car finance for a private sale: how it works
You can finance a car you're buying from a private seller. Here's what the lender checks, how the seller gets paid, and what you'll need to have ready.
My Finance Hub · Updated October 2026
Short answerYes, you can finance a private sale. The lender checks the car is free of finance, confirms its value, pays out any loan still owing on it, then pays the seller directly. You don't hand over cash, and the seller is paid at settlement.
Step by step
- Get approved first. Knowing your approval and budget before you start looking means you can move quickly when you find the right car.
- Find the car and agree on a price. Get the seller's details, the VIN, registration number and odometer reading. A written agreement with the price helps.
- The lender checks the vehicle. This usually includes a PPSR search to confirm whether any finance is owing and whether it's been reported stolen or written off, plus a check that the price is reasonable for the vehicle.
- Inspection and documents. Some lenders ask for photos or an inspection, plus the seller's ID, bank details and a private sale invoice.
- Settlement. The lender pays out any finance still owing on the car, pays the rest to the seller, and you transfer the registration.
What if the seller still owes money on the car?
That's common. The lender pays the seller's financier directly to clear the debt, then pays the balance to the seller. A payout letter from the seller's financier is usually needed, so ask for it early.
Private sale vs. buying from a dealer
Private sales can be cheaper, but there's no dealer to handle the paperwork, and you usually won't get a warranty. Lenders may also have tighter rules for private sales, such as limits on the vehicle's age or a required inspection.
Tips to avoid problems
- Be careful about paying a holding deposit before the lender's checks are done.
- Check that the VIN on the car matches the registration papers.
- Get a mechanical inspection, especially for older vehicles.
- Be wary of sellers who won't meet in person or push for a quick cash deal.
FAQs
Can I get finance for a car from Facebook Marketplace or Carsales?
Yes. Where the car is listed doesn't matter. The lender checks the vehicle and the seller the same way.
How long does private sale finance take?
Once you're approved and the seller's documents are in, settlement can often happen within a few business days. Delays usually come from missing documents or waiting on a payout letter.
Is the rate higher for a private sale?
Not necessarily. Your rate depends mainly on your credit profile, the vehicle and the lender, and some lenders treat private sales the same as dealer sales.
Talk to us
Found a car on Marketplace or Carsales? Get approved first, and we'll handle the lender checks and payment to the seller.
Related
General information only. It doesn't take into account your objectives, financial situation or needs. Credit criteria, fees and charges apply. My Finance Hub is a Credit Representative (553769) of Purple Circle Financial Services (Australian Credit Licence 486112).