As most of us know, used-car buying is a business wrought with scams. Well, used-car sellers need to be aware of potential scams, as well. Here are some of the most common ones:
Certified Check Scams - This scam is often perpetrated on sellers of used cars over the Internet. A buyer indicates that he wants to buy the car and pay with a cashier's check. At the last minute, the buyer creates a reason why he needs to write the check for more money and have the seller wire him the difference. The check turns out to be a fake, but it is often discovered long after the seller has wired the money. In addition, the seller is responsible for covering the money for the fake check. To avoid check scams, call the issuing bank before you accept the check and wait for the check to clear before you transfer the car into the buyer's name.
Bogus Escrow Services - Online car sellers often use escrow services, which collect and verify payment from a buyer. The money is held by the service until all parties are satisfied with the sale. There have been some instances of phony escrow services operating on the Internet. Make sure you check out an escrow service.
False Auctions - eBay and other sites like it have become very popular, but this does not mean that buyers and sellers can't be swindled. In fact, according to the Federal Trade Commission, the most frequently reported Internet fraud occurs on auction sites. Make sure you carefully research the buyer and his buying history. Never ship the vehicle before the money has been received.
The best way to avoid most scams is to make sure you never transfer ownership of your car until you have the cash in your hand. That means, you either get cash from the buyer or wait for the cashier's check to clear. Avoid taking personal checks and allowing buyers to pay the car off over time. If you follow these few precautions, your car-selling experience should go smoothly.
Finally, you might be wondering, "What do I do if I'm not satisfied with the sale?" If you feel that you have been taken advantage of, there are several things you can do. First, you can contact your local police department and file a report. Then, contact the consumer protection division of your state's Attorney General office. If you have been a victim of Internet fraud, you can contact the FBI's Internet Fraud Complaint Center or the National Fraud Information Center.
As the seller of the car, most states do not require you to offer a warranty on the vehicle. Thus, if the car breaks after you have sold it, you are no longer responsible. To avoid problems, make sure the car has been inspected by a mechanic. If you are open about the condition of the vehicle, you can feel confident that you have done everything you can do to be a successful car-seller.
Selling a car should be a good experience for both buyer and seller. In the ideal situation, everyone gets what they want: The buyer gets a new car, and the seller gets an acceptable amount of money. Making sure you know your market, get the word out with a good advertisement, negotiate for your best price, finalize the sale and know what you can do if things don't go well should make selling your car a positive and uncomplicated experience.