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How to Buy a De-registered Car in NZ

Posted on October 1, 2018 – Shipping Vehicles

 

If you are looking into purchasing a second-hand vehicle, you may come across so called de-registered cars. Their great advantage is that they can be a bargain. Although there are legitimate reasons why a car may be de-registered without it hiding anything sinister, you should however exert caution and do your homework as it can also be a sign that the vehicle is a lemon.

 

How does a car become de-registered?

There are three main reasons why a car may be de-registered.

a) The license has been cancelled by the New Zealand Transport Agency (NZTA)

The first one is usually due to the owner not realising that the car’s registration has lapsed or, in the hustle and bustle of life, simply forgetting to renew it, and in the current system in NZ, it is quite easy to do.

Vehicle’s registrations need to be renewed every year but you will need to provide a current Warrant of Fitness (WoF) certificate to do so. Now, the problem is that the frequency the WoF must be issued to keep a vehicle roadworthy depends on the vehicle. It can be every 6 months, every year or every 3 years and as it won’t always coincide with the ‘expiry’ date of the registration, it is easy to lose track. As the NZTA automatically deregisters vehicles 12 months after their latest registration unless it hears from the owner, there are many cases of owners not realising their registration has lapsed until they bring their car in for their Warrant of Fitness inspection. Reminders are sent by post but if the owner has moved houses and forgotten to inform the NZTA, they will never get them.

b) The license has been cancelled by the owner

It could be because the car was damaged and not roadworthy any more but also because they knew that they weren’t going to use it for a significant period of time. The owner might have spent some time abroad or taken a long holiday, or they might not have needed the car, all perfectly legitimate reasons, so a de-registration isn’t always an ominous sign. It is possible to put the license on hold for a period of time but not everybody is aware of this.

c) The vehicle is a statutory write-off

There is, however, another reason why cars are de-registered and you should proceed with extreme caution if this is the case of the vehicle you are considering.

Typically, a vehicle will be de-registered by insurance companies if they have been structurally damaged and have been deemed uneconomical to repair. In the latter case, it doesn’t mean that they can’t be repaired or won’t be safe, but that it is cheaper for insurers to write them off, but it has to be said that, in any case, a written-off status should ring alarm bells and prompt you to have the vehicle’s history thoroughly checked. The NZTA sometimes holds this information but there are also companies which will do that for you.

The kind of damage that will get a vehicle de-registered by an insurance company is usually of a structural nature. It means that the integrity of the bonded or welded seams and joints has been compromised and that safety devices, likewise, are not up to standards.

Having it repaired to a safe standard can be very difficult and expensive so it is wise to obtain a detailed report about the extent of the damage and a quote to repair it before committing.

There have been, in the past, problems with de-registered vehicles that were only fit for spare parts being sold to unsuspecting buyers.

In 2014, the NZTA reported that, of the 4,000 to 5,000 vehicles imported each year from Australia, 60% were statutory write-offs and should be in a scrapyard, prompting classifieds website Trademe to demand that sellers declare whether the vehicle they were advertising was indeed a write-off. However, it is much more difficult to check the veracity of owners’ claims of roadworthiness if the car comes from abroad, and some unscrupulous car dealers have also made a living buying such cars in bulk and selling them on to customers reassured by the fact that the car is in the country – and therefore should meet certain standards.

Even if the de-registration occurred because the previous owner was forgetful, it is always a good idea to get a pre-purchase inspection done. Who knows, it might even give you some ground to negotiate a discount!

 

How do I get a de-registered vehicle back on the road again?

Providing that there is nothing monstrous hidden behind the de-registration, it is fairly straightforward to get a de-registered vehicle back on the road, it just needs to pass an inspection.

It will have to meet a comprehensive list of standards. Older vehicles need to comply with the standards that were in place when they were first registered while newer vehicles will be inspected even more closely and will have to comply with certain emission levels and frontal impact safety rules.

It has to be said that the process to issue a Warrant of Fitness for a de-registered vehicle is more thorough, which is reflected in the eye-watering cost: budget between $400 and $500. Add up to another $400 for the re-registration and plates.

Bear in mind that a de-registered vehicle technically doesn’t exist any more so make sure that you get a receipt from the previous owner to prove that you bought it and own it as, without it, you won’t be able to re-register it!

Buying a de-registered car can be a bit more complicated, but it can also throw up a gem at a discount. It is a deal you need to enter with your eyes open, and make sure that you do the appropriate checks before parting with your money, but it can be worth it.

If you are looking for a shipping company, contact Mc Cullough on 64 9 309 1163 or request a quote online.


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