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Car Buying Scams
Car buying scams can be found whether you buy your car
through the internet, the classified ads or a dealer.
Most online car transactions go ahead without a
problem. However it pays to be suspicious and watch for signs of a scam.
The best way to avoid most of the scams is to make sure you don't transfer
ownership of your vehicle until you have the cash in your hand.
If you receive cash, that is fine, but if your
receive a cashier's check, it means waiting for the funds to clear which may
take a few weeks.
Avoid taking personal checks or allowing the buyer to pay the vehicle off
over time.
Types of Car Buying Scams
The two main types of car buying scams
we will cover are;
Car dealer scams
Used car scams
General Advice to
Avoid Car Buying Scams
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Many scams begin by offering unrealistically good
deals such as offering a brand new Mercedes for $15,000? These offers
are designed to get your attention and then get your money
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Talk to the buyer or seller by phone and find out
where the car is located. Ask if you can inspect the car, even if you
don't plan to do so. Also ask if the title is clear and in their
possession
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Check the authenticity of the escrow company you plan
to use by checking it is licensed. Visit their website by typing
it into your computer address bar, and not by using a link in an email.
Call them and speak to a representative. Don't use an escrow company
specified by the buyer or seller as it could be fraudulent
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Choose an escrow company yourself and check the online
escrow company's web site for poor content, spelling or grammar errors
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Keep clear of sites that require you to set up
accounts with online payment services. Legitimate escrow companies don't
use person-to-person money transfers like Western Union or MoneyGram or
direct you to send your payment to an individual rather than a corporate
entity
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Fraudulent escrow sites often display logos from the
Better Business Bureau, VeriSign Secure, TRUSTe, and even the Internet
Fraud Complaint Center. They work on the assumption that you won't check
them out. Check to make sure the escrow company is actually endorsed by
these organizations
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Avoid
escrow company sites ending with domain names such as .org, .biz, .cc,
.info or .US
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Don't
give out your financial or personal information [Social Security number,
credit card number or bank account information] until you are sure the
online escrow company you are using is legitimate
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Never accept payment which does not exactly equal
your selling price
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When you are selling your car to someone you don't
know, choose someone you trust [like your attorney or bank] and get them
to hold the title in escrow until you are certain the payment
transaction cannot be reversed
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Under Federal Banking Regulations, a bank must make
funds you deposit available to you within a couple of days. If you
deposit a cashiers check, the bank must let you withdraw cash by the
next day, even though the funds haven't cleared. This may take a couple
of weeks, or in some cases up to a month. If the check proves to be fake
as sometimes happens in
car buying scams, the amount will be deducted
from your account
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