It's 2018, and the number of people who skip the dealership and buy a used car online from a private seller is growing everyday. But while the peer to peer marketplace is booming, so are the scams. Here's 5 tips to make sure your next online car buying experience is safe as possible.
1) Verify the seller's identity in person
Unless you are doing business through a trusted platform that protects your purchase, you should NEVER close the deal online. There's simply too many ways you can get burned.
A car is a huge purchase, and therefore requires a substantial amount of trust from both parties involved. If your seller won't give you their full name, address and phone number, they are not someone you want to be doing business with.
However, you're going to need even more information than just that. After all, it's not hard to fake a name and address, or get an anonymous google voice number. You'll want to see their drivers license, title, and insurance card information, and verify that they all have the same information. This will confirm two things:
- They are who they say they are
- The car is not stolen
2) Never Use Anonymous Forms Of Payment
The reason scammers request anonymous forms of payment is because there is nothing tracing back to their crime. And to make matters worse for you- it makes you ineligible for any type of refund from your banking institution.
If a seller asks to be paid via Western Union, Money Gram, cryptocurrency, or a reloadable debit card- this should raise a big red flag. There is no legitimate reason to conduct a car purchase with an untraceable currency, so don't listen to whatever excuses they come up with.
Anyway, while sticking to forms of payment that are personal is a good rule of thumb, that's not fool proof either. you can still be scammed with transactions that use personal information, such as wire transfers.
Many people let their guard down when it comes to wire transfers, since it is extremely difficult to create a bank account not tied to verifiable personal information in the United States.
But what they don't plan for is scammers stealing other people's identities, temporarily taking over their bank account and then wiring the money into an overseas account once it goes through. How to prevent this? Go back to tip #1. If you verify the seller's identity in person and cross reference it with their drivers license, car title, and insurance card, this scam stops before it even starts.
3) Get Specific Vehicle Information
We strongly recommend seeing/ test driving the car you're buying before you close the deal. However, if the car is out of state and you've decided you must have it... here is how you should proceed.
- Ask for the VIN and a copy of the vehicle registration.
With this information, you will be able to get a vehicle history report for the car ( we recommend using InstaVin). The vehicle history report will tell you lots of important information- such as the number of previous owners, odometer verification, accidents, and any pending vehicle recalls.
In addition to this, you should also ask the seller to have the vehicle inspected by a mechanic of your choosing, who can send you the results. This will allow you to objectively evaluate the state of the car, and determine if any costly repairs need to be made in the near future.
4) Close the deal in a safe place
The best place you can close the deal is at your bank. Have the seller meet you there with the title, car, and keys in hand. A good way to pay in this situation is with a cashiers check.
The reason for this is that the face value of the check is drawn from the bank's own funds- meaning that it is guaranteed. Since the transaction is occurring at your bank, they can prepare it in front of the seller- verifying its validity.
This is preferred to a personal check, where there is no guarantee of available funds. Regardless of whether you pay with a personal or cashiers check, the most important part is that the transaction occurs in a place where the validity of the check can immediately be confirmed.
The basic idea here is to be able to get the car, title, and keys in your legal possession as soon as possible.
If you'd like to avoid checks altogether, you can also do a wire transfer. This is a good option because it's instant, and gives you the flexibility to do the transaction anywhere. Of course, this method is not advised until you have verified the seller's identity first.
As a third option, you can also use an online escrow service. In an escrow deal, a neutral third party holds the assets ( the money, car, title etc.) and makes sure both parties hold up their side of the deal in the transaction. Escrow services can be a good way to do things, provided that it is a reputable service.
Scammers have been known to create fake escrow websites and lure unsuspecting victims into them, under the guise of a "safe transaction".
So with this in mind, If you decide to close the deal online, at least take these precautionary steps.
- check the url of the website you are on.
This is the dead giveaway in every scam. Typically what will happen is the seller will contact you via email, and give you a link to a website where they have the car listed so you can purchase it.
Often times the link will be to a well known site like Ebay, or even Edmunds ( which doesn't even assist in private party transactions).
The site they send you to will be essentially a carbon copy of the real thing, complete with many of the same pages contained in the real one. but of course when it comes time to fork over the cash for the car...you won't be receiving one.
If you look at the domain name ( url) you'll be able to determine if the site is fake one of two ways:
A: The url is slightly misspelled ( Ebay.com) vs. ( Ebayy.com)
B: There are a bunch of random letters and numbers after the domain name (Ebay.com/85twrgj49gh42ujd)
If you still feel unsure about the validity of the site, another easy way is to look at how long the site has been in existence.
To do this, go to Google and type in "site:" and then copy and paste the URL in question.
Under "results" select custom range and check a few years back.... say "2012- 2013". If nothing shows up you will know that site was created fairly recently, and is therefore fake.
note*: look up when the real site was created, and use that date as your reference point. You'll want to check as far back as possible, in case this is a scam that the seller has been running for a fairly long time.
5) Don't Make Emotional Decisions
Scammers use your emotions against you in an attempt to cloud your judgement. If you see a car that is in great condition and priced ridiculously below market value, don't get excited. Instead, analyze the situation rationally. Why would someone go through all the work of selling their car privately, only to list it at a price below dealer trade-in?
If they really needed to get rid of their car "right away", they would have just gone to a dealer.
As the old adage goes, "if something sounds too good to be true...it probably is".
Likewise, don't fall for sob stories.
It's easy to feel sympathetic for a military member who was suddenly deployed overseas, or a thoughtful grandson selling his car to cover his grandmother's hospital bills.
Don't believe it even for a second. The only thing that should be influencing your decision to buy is the quality of the car itself- and that's it!
There's no getting around it, buying a car online can be risky. However, we've made it safe to do so at Swap Motors. We verify all our sellers and cars, so you don't have to. And when it comes time to do a test drive or close the deal, you can do so at one of our safe and secure Swap Centers.
And if you have questions during your buying process, We have ASE certified technicians available onsite that will help you.
It's pretty awesome. But why don't you see for yourself? Check out our marketplace today, and see if one of our cars catches your eye.