When it comes to buying and selling used cars, buyers aren’t the only ones at risk—scammers target sellers, too. Before you list your vehicle for sale, learn how to spot the most common scams so you can sell your car safely.
Signs of a Scam
Not every potential buyer is a fraud, but you should still watch out for these telltale signs of trouble when attempting to sell your car to a stranger:
- Offering to purchase the vehicle without seeing it: This is a big red flag that should make you question the legitimacy of the payment. The buyer may send a bad check or promise to wire money while a different person picks up the vehicle, keeping the scammer anonymous.
- Wanting to pay with a check or money order: Plenty of checks and money orders are legitimate, but scammers will pay with fraudulent versions. If you sign over the title before the money clears, and it turns out to be a scam, you’re out of luck.
- Attempting to overpay: Scammers may say someone owes them more money than your car is worth. To bribe you into the trap, they’ll ask for the car in exchange for this higher price, which they promise the other individual will pay.
- Requesting a payment plan: Promising to make monthly payments is a sure sign of a scammer. You have no way to collect if the buyer misses a payment, so it’s best not to accept these offers.
- Using an unknown escrow service to complete the transaction: This payment method may seem secure at first, but if the escrow service is one you’ve never heard of, it may be illegitimate. In this case, you sign over the title, the buyer takes your car, and suddenly the money is no longer in escrow.
- Asking for your personal information: Fraudsters may promise to wire you money, but claim they can only do so with your bank account number, credit card number, Social Security number, or other personal information. This is an attempt at identity theft.
Tips to Avoid a Scam When Selling Your Car
To avoid the most common scams and sell your car safely, follow these tips:
- Screen your callers: If you sense that you’re speaking to a scammer, end the conversation and block the number.
- Beware of unfamiliar escrow services: Always research the service the buyer suggests and go through a reputable lawyer or bank to make sure the escrow account is legitimate. The Better Business Bureau is a great place to confirm the legality of any business.
- Document everything: Don’t just sign over the title—put everything in writing. First, write down the buyer’s name, phone number, driver’s license number, and other information to aid in a potential investigation down the road. Then, complete a Bill of Sale and Release of Liability to protect you from taking the blame for future traffic tickets the new owner may incur.
- Ask for a driver’s license: If you let a potential buyer test drive your car, ask if you can hold onto their driver’s license. Write down the name and driver’s license number, so you know who you’re dealing with.
- Meet in a public place: When a buyer wants to look at and test-drive your car, it’s a good idea to meet in a public parking lot rather than at your residence.
- Black out personal information on service records: The buyer may request vehicle maintenance paperwork, which is completely acceptable. Just make sure you black out your credit card number, phone number, address, Social Security number, and any other personal information that could lead to identity theft.
- Don’t accept monthly payments: Tell anyone who wants to pay monthly installments that you’re not a bank. If the buyer doesn’t have the cash, he or she will need to get a loan from a bank, pay you in full, and pay back the bank.
- Don’t hand over the keys or ship the car until the payment clears: When the buyer pays with a check, money order, or wired cash, wait for it to clear with your bank. If possible, complete the transaction at the buyer’s bank, so you instantly know if the funds are available.
- Go with your gut: In the end, it’s wise simply to use your best judgment. Instead of jumping at the first offer, even if it seems a little sketchy, be patient and wait for the right buyer to come along.
Give Potential Buyers Confidence with a Pre-Purchase Car Inspection from Scott’s
Savvy car buyers will likely request a pre-purchase car inspection before they finalize the purchase. Bring your vehicle, or let the buyer bring the vehicle, to Scott’s for a once-over to verify the condition of the car and give the buyer peace of mind.
To learn more, or to schedule your pre-purchase car inspection, please call our Fort Collins auto repair shop at (970) 682-4202 today. You can also schedule an appointment with us online.