How to sell your car on consignment
To sell your car on consignment, you sign an agreement with a licensed dealer who markets and sells it for you, then pays you the sale price minus their fee and any agreed costs. You usually get more than a trade-in and skip the hassle of a private sale, but you wait for a buyer and you pay a commission.
- The car stays yours until it sells. The dealer handles photos, ads, enquiries, test drives and paperwork.
- You pay a fee: a flat amount, a percentage, a tiered rate, or the dealer keeps anything over an agreed price.
- Read the agreement for the term, fees if you pull out, who pays for repairs, and when you get paid.
- If you still owe money on the car, the lender is paid first from the sale and you get the balance.
How it works
- You contact a dealer that sells on consignment. They inspect the car and suggest a price.
- You sign a consignment agreement setting the price, the dealer's fee and how long it runs. In Queensland this is the approved Form 9.
- The dealer preps, photographs and lists the car, and handles enquiries and test drives.
- Offers come to you. You decide whether to accept, counter or decline.
- When it sells, the dealer pays any finance owing, takes their fee and agreed costs, and pays you the rest with a statement showing the working.
Check the dealer can consign in your state
Only use a licensed dealer. In Victoria, licensed motor car traders aren't allowed to sell cars on consignment for private owners (public auctions are different), so a Victorian dealer offering to consign your car privately is a warning sign. In WA, a dealer needs Category E on their licence to sell on consignment.
In QLD, NSW and WA, your money from the sale must go through the dealer's trust account, not their business account. Ask the dealer to confirm this.
What it costs
Dealers charge in different ways. These are examples to show the maths, not typical rates.
| How the dealer charges | Example on a $20,000 sale | You receive |
|---|---|---|
| Flat fee of $1,200 | $1,200 | $18,800 |
| 7% of the sale price | $1,400 | $18,600 |
| You get an agreed $18,500; dealer keeps the rest | $1,500 | $18,500 |
Also ask about marketing fees, recon or detailing costs and any early withdrawal fee, as these come off your money too. Try your own figures in the consignment commission calculator, and see consignment commission rates for more examples.
Consignment vs private sale vs trade-in
| Consignment | Private sale | Trade-in | |
|---|---|---|---|
| Price you get | Retail price minus fee | Full price, if you find the buyer | Usually the lowest |
| Your time | Low | High: ads, calls, inspections, test drives | Lowest |
| Speed | Weeks, depends on the car and price | Varies | Same day |
| Safety and paperwork | Dealer handles buyers, payment and transfer | You handle strangers, payment and transfer | Dealer handles it |
| Buyer's protections | Rules vary by state | Few | Not relevant to you |
What to check in the agreement
- The asking price and your lowest acceptable price (reserve), and that the dealer needs your written OK to drop it.
- The fee: how it's calculated, and whether it's capped.
- The term, and how renewal works.
- Marketing, detailing or recon costs: what's included, what needs your approval, and a dollar cap.
- What happens if you take the car back early, and any fee for doing so.
- Who insures the car while the dealer holds it, and who can drive it.
- How and when you're paid after the sale.
- Finance owing: how the lender will be paid out.
How you get paid
After the buyer's money clears, the dealer settles. You should get a written statement showing the sale price, the fee, any agreed costs, any finance payout, and your net amount. Timeframes depend on your state: in WA the dealer must pay the owner within two business days of receiving payment, in NSW the dealer must account to the owner for the sale proceeds within 14 days (or another prescribed period), and in QLD the dealer must pay within 14 days of a written request or within 42 days of the deal finalising. Ask your dealer what they commit to.
If it doesn't sell
At the end of the term you can renew, drop the price, or take the car back. Check the agreement for any fees on return and for recon costs you've agreed to pay either way. When you collect the car, check its condition, the kilometres and that you get every key and document back.
If you still owe money on the car
You can still consign it. Tell the dealer at the start and get a payout letter from your lender. When the car sells, the dealer pays the lender first, then their fee, then you. If the sale price won't cover the loan, you'll need to pay the difference. See selling a car under finance.