When buying an automobile online or through a classified ad in a newspaper, fraud is a real threat, as many well-meaning buyers all-too-often fall victim to scammers. This being the case, it’s important to take the proper measures to protect yourself. The following tips will help you make sure you avoid fraudulent transactions. For starters, just being aware that you could be taken advantage of is a great first step to avoiding scam artists.
Using PaySAFE to complete a transaction is also a great way to avoid fraud. Acting as a neutral third party escrow service, PaySAFE offers both buyer and seller safe, secure and easy-to-use tools to close the deal. No money is exchanged until all the terms of the transaction are approved by the buyer and the seller.
Use common sense
Double checking everything and using common sense will go a long way in protecting yourself from scammers.
- Know the market value. Unless you’re buying from a friend or family member, you should expect to pay the market value for the car you’re interesting in purchasing. That said, be very suspicious if a vehicle is priced much lower than market value — it’s most likely bait from a scammer to lure you in.
- Match the seller to owner. Obtaining a history report provides all kinds of useful information, like whether or not the seller’s name is on the title (it should be), if the car’s had any accidents reported to authorities and if the car’s ever been reported stolen, salvaged or damaged. CARFAX is an easy way to obtain a history report.
- Inspect the car. Take the car to a trusted mechanic of your choice for an inspection. If the car is out-of-state, hire a professional inspection service. NEVER let the seller take the car to a mechanic of their choice.
- Match VIN number on car to VIN number on title. If these two numbers match, you’re clear to (cautiously) proceed with the transaction. If they don’t match, get an explanation from the seller, as you might be dealing with a stolen car.
- Make sure the car isn’t flood-damaged. If possible, the mechanic who conducts the inspection should also be trained in handling flood-damaged vehicles. (Warning signs include water lines and mud or mildew under carpets, on the trunk floor and in enclosed areas such as door panels and the gas tank.) Checking the title may reveal if the car’s been salvaged, however not all states require this. Last, check the VIN in the National Insurance Crime Bureau database of vehicles involved in recent hurricanes. This service is free-of-charge, but keep in mind it doesn’t cover all flood-damaged vehicles.
- Confirm the seller’s contact info. Verify the seller’s street address and phone number before sending any payment (for this, it’s preferred to use PaySAFE escrow service). Also, if the seller lives overseas, be very cautious — and always use PaySAFE’s escrow service.
- Be wary of too much email communication. Using email is fine for the most part, just be sure to NEVER send any sensitive personal or financial information — like your social security number, credit card number or checking account number — by email. It’s also a red flag if the seller refuses to talk to you on phone.
- Obtain a detailed receipt. The receipt should include if the car is being sold with a warranty or “as is.” Also, it should state any/all accessories that are included. Using PaySAFE allows you to describe in detail all warranties and expectations.
- Get the car’s title. Before you purchase the vehicle, make sure you know what’s required in your state to properly transfer the title. Your local DMV has plenty of info.
If you’re interested in buying a used car with PaySAFE, check out how it works on our website.