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When you pay a deposit and sign a sale note, or even an order form for a car, a contract is formed which means that, legally, you are bound to purchase the car.A 'cooling off' period of one business day has now been introduced in Queensland. This gives you time to change your mind when you sign a contract with a licensed dealer providing you don't take delivery of the car. So beware and consider the following points:

Never sign any document if there is anything in it you do not understand or if it does not accurately reflect what you and the seller have orally agreed to earlier. Seek advice from someone you trust who has experience in buying cars.

Never sign an incomplete contract· Never sign any document until you know the total cost it binds you to.

Always get a copy of any contract or other document you sign. Be wary of signing any contract that is conditional. It could depend on a situation not yet known, such as your ability to pay, or the condition of the car. Such a contract may appear to protect you but often actually binds you to the contract of the dealer's choosing. It is better to have everything cleared up and agreed before signing anything.

Sign on the dotted line only when you're sure it's safe to do so.

Subject to Finance

Don't sign any document to purchase a car 'subject to finance being arranged.' If you do sign such a document and then find you can't arrange the finance of your choice, you could be pressured into accepting finance arranged by the dealer, probably at a much higher interest rate.If you do sign any contract prior to arranging your finance, make sure that the document specifies quite clearly that finance is to be arranged by you, and must be satisfactory and acceptable to you the purchaser. If known, also specify the amount and source of finance.A suitable clause would be 'subject to the purchaser obtaining finance sufficient to complete this purchase from ...............' (You should specify the name of the institution from which you will borrow the money).

Subject to Inspection

Never pay a deposit, sign an order form or purchase agreement that contains words such as 'subject to RACQ inspection.' Regardless of the findings of the RACQ inspection report, the dealer could hold you to the agreement to purchase the car on the grounds that the provision to have the car inspected has, in fact, been fulfilled. Even a sales agreement that has words such as 'subject to a satisfactory RACQ inspection report' or similar should not be signed. Unless it is specified that the report must satisfy the purchaser, then what constitutes a 'satisfactory' report could be a matter of dispute between buyer and seller. So the only form of wording that you, the purchaser, should accept is 'subject to the purchaser obtaining and being satisfied with an independent inspection of the vehicle.'

Subject to Repairs

Don't sign on the promise to repair faults 'It could be a smoke screen'. They may not be done properly or may not include the really expensive defects. Wait until the car is as you want it. If a dealer tries to pressure you into signing anything that could bind you to buying a car before you have satisfied yourself regarding its condition and your capacity to pay for it, walk out of their office.

Don't be Pressured

Don't fall for the line that another buyer is 'extremely interested' and is waiting to buy your car. There are plenty of other cars out there.

Paying a Deposit

After looking around for weeks, you've finally found just the car you want. The dealer has asked you to pay a deposit while you're thinking about it or waiting to have the car inspected, or even while you are arranging finance. He may want a deposit to hold the car during the 'cooling off' period.

When you decide to pay a deposit, the RACQ's advice is to pay the minimum deposit the dealer will accept.

Before handing over any money as a deposit, find out how much of your money will be refunded should you decide not to go ahead with the purchase.

If a dealer promises to refund your deposit, get this promise in writing.