Buying a used car with low mileage and a complete service history at an affordable price may seem like the deal of the century. However, you need to do much legwork to make sure you’re not getting caught in one of the many used car scams.
According to Better Business Bureau data, 256 reports of fake or nonexistent used‑car listings were filed in 2023, although this represents just 4.8% of actual incidents, implying thousands more unreported cases annually.
Some scammers use obvious techniques, while others commit their frauds on a more professional and covert level. The ultimate goal of a vehicle scammer is to get as much money as possible before you understand you’re being lied to.
The good news is, you can protect yourself and learn how to avoid used car scams. In this article, we’ll guide you through every detail on used car scams: from preventing a scam to overcoming its consequences.
Common Used Car Scams to Watch Out For
Let's start our used car buying tips with recognizing the most common types of fraud.
Odometer Rollback
If you think odometer rollback has disappeared with the invention of digital odometers, we’ll disappoint you. In the US used cars market, the rollback is still a common issue, costing buyers thousands and making it difficult to find a reliable used car.
Odometer rollback refers to the deliberate rolling back of the miles the car has been driven to show lower mileage than it really has and to artificially increase its value. For example, a 2020 Honda Civic EX Sedan with 100,550 miles is priced at $18,950, while the same model with 156,262 miles costs approximately $16,599.
Identifying a false odometer can be difficult. Here are some tips to help you detect odometer fraud.
- Too much wear for the mileage: Check for a worn-out steering wheel, pedals, floor mats, and seats. Physical deterioration indicates that the car isn’t lightly driven.
- Unreliable vehicle history: The vehicle mileage should increase over time in the reports. If you notice mileage decreases or unusual gaps, that’s a red flag.
- New or mismatched components: If the car has overly new braking systems or a timing belt that can serve for the next 30,000 miles, it’s a sign that the actual mileage is much higher than it’s shown.
Title Washing
Among used car scams, title washing is particularly worth watching for. Title washing is information falsification on a car’s title to hide its real condition or history. When a car is involved in a severe car crash or disaster, it should include various title brandings like salvage and water damage in the history reports. If this significant information is hidden from buyers, then you could end up buying a lemon.
Sounds awful, right? But no worries. Here are some red flags we’ve picked for you to determine if the car has been title-washed.
- Absence or previous purchase and service records
- Painted or removed VIN plate
- Mismatched or flaking paint
- Rusty undercarriage
- Salvage title in the history report.
To access and verify a vehicle’s official title history, you should just run a VIN check through the National Motor Vehicle Title Information System (NMVTIS) or state DMV websites.
Fake Online Listings
Shopping for a car has never been easier with so many online platforms at your fingertips. However, this plethora of available options also comes with a potential pitfall: fake vehicle advertisements. Scammers post ads for cars that aren’t for sale or, even worse, don’t exist, causing loss of money and time. Here's how to detect a fake car listing:
- Unrealistically low prices. If the price is too good to be true, that’s probably a scam.
- Blurry photos: Scammers usually post only one or two low-quality photos of the supposed car.
- Vague descriptions with typos and mistakes: A poor description with mismatched details and mistakes is always an indicator of a scam. Moreover, if the seller refuses to share information on the car's history, including VIN, walk away.
- Manipulative and pushy urgency. Scammers typically pressure buyers to make a quick decision, causing them to overlook the warning signals.
To avoid falling victim to fake car listings, you should:
- See the car in person and have a pre-purchase inspection.
- Request a vehicle history check.
- Do your research concerning the seller.
- Do not send deposits or payments before verification.
Curbstoning (Fake Private Sellers)
Curbstoning means used vehicle sales where unlicensed dealers pretend to be private sellers to avoid regulations. These scammers often sell vehicles that have hidden damages or salvage titles. State laws prohibit private citizens from selling multiple cars unless they are titled to them. By ignoring these laws, scammers sell vehicles that reputable dealers won’t come near. And here’s how to spot curbstoning:
- The seller refuses to provide ownership documents.
- They insist on meeting in public places.
Escrow and Payment Scams
Searching and buying a used car on online platforms makes life so much easier but it also opens the door to fraudulent payments and transfers. Scammers use fake escrow services to seemingly ensure buyers' money is safe. Meanwhile, these scam escrow providers merely serve their interests, leading to the loss of your money. So, always make sure the provided services are verified and established not to fall victim to fake platforms. You should:
- Check the platform’s business history on BBB Business Search.
- See to whom the website belongs on the Whois Lookup Tool (ICANN)
- Verify on Escrow.com.
In addition, pay close attention to poorly constructed websites, including grammar mistakes or fake contact information.
How to Avoid Used Car Scams
Always Get a Vehicle History Report
Requesting a vehicle’s history is non-negotiable. These reports provide buyers with accurate and detailed information about the used car's past, including major accidents, past owners, maintenance records, title information, and more. Plus, to be sure the history reports are reliable and not falsified, check them out at Carfax and AutoCheck. These providers have subscriptions with the most reliable car dealers and franchises.
Verify the VIN and Title Information
The VIN or Vehicle Identification Number stands for a unique code of 17 letters and numbers, providing details on its make, model, history, and year. You can usually find the VIN on the plate of the driver's side dashboard. Also, look for the VIN check on:
- Driver side door jamb
- Front of the chassis
- Radiator
- Trunk
- Engine block.
After you’ve found the VIN, you can search it on the NHTSA VIN Decoder or AutoCheck. This way, you’ll check if the seller’s description is accurate and detect any fraud concerning the past accidents, title issues, or odometer rollbacks.
Meet in Person and Inspect the Vehicle
As mentioned above, scammers typically post deceitful and heavily edited photos of vehicles. So, here’s how to avoid car buying scams.
- Ask for a real meeting to see the car in person.
- Organize your meeting in a safe and public place with security cameras, such as a police station or a shopping mall parking lot.
- You can either check for red flags yourself, or it’s even better to book a third-party inspection and let the professionals do their job.
- Always take a test drive. Driving the vehicle can reveal hidden issues that you can miss during a stationary inspection.
Use Secure Payment Methods
When buying a used car, you should pay particular attention to the payment method. Avoid any seller who insists on wire transfers or prepaid cards. These payment platforms are difficult to trace and almost impossible to recover. We recommend:
- Use secure payment methods like bank transfer or escrow.
- Do not pay upfront. Any seller who requests full payment before showing the car in person is a red flag.
Trust Your Instincts
Another powerful tool for identifying used car scams is your intuition. If you feel uncomfortable in any aspect of the purchase, from the seller’s behavior to the paperwork involved, trust your instincts and walk away.
Moкeover, legitimate sellers should always give you time to make a decision without any pressure. Any high-pressure sales tactics are a common sign of used car scams. If scammers claim other buyers are waiting or use some other reason to push you to an urgent and unthoughtful decision, you should step back.
Buying from Private Sellers vs. Dealerships
You can find your dream used car either from private sellers or from official dealerships. Let’s explore the pros and cons of each option.
Dealerships are known to be a reliable and trustworthy way of getting a used car. Here’s what you’ll get:
- Legal protection
- Vehicle history and warranties
- Varied financing options
- Ongoing customer service.
The drawbacks of choosing dealerships are:
- No place for negotiations
- Higher prices.
Private sellers’ advantages include:
- Lower prices
- Access to the seller
- Negotiation opportunities.
The cons of buying used cars from private sellers are:
- Limited legal protection
- No warranties or historical records
Before making your final choice, consider that dealerships offer safe and trustworthy purchases without risks of potential fraud. On the other hand, private sellers will give you the room to negotiate and have some savings from your purchase. In both cases, we recommend you take a test drive as well as check its history reports.
What to Do If You’ve Been Scammed
So, do you know what to do if you get scammed buying a car?
- Gather all relevant information, including emails, names, messages, transaction records, and other contact details.
- Report the scam to the Federal State Commission and give them all the evidence details that you’ve collected.
- File a complaint with the Internet Crime Complaint Center of the FBI and the local Department of Motor Vehicles.
- Contact your bank to freeze your accounts if you’ve made any payments.
- Seek professional legal advice from a lawyer who can explore your case and explain your rights.
In addition, follow these steps to protect yourself from used car scams:
- Research the vehicle and its lowest price in the market.
- Profile the seller to verify the seller’s identity.
- Meet the seller and the vehicle in person.
- Never make an upfront payment without seeing the car.
- Don’t trust an escrow site recommended by the seller.
- Trust your gut if the deal doesn’t feel right and is rushed because of fake reasons like an emergency.
Final Thoughts
Used car scams and their tactics are evolving and becoming more sophisticated over time. Protecting, first and foremost, starts with recognizing. You should watch out for odometer rollback, title washing, fake online listings, curbstoning, and payment scams.
To avoid falling victim to used car scams, check vehicle history reports, meet in person with the seller, and use secure payment methods.
If you’ve been scammed, report to authorities, including the Federal Trade Commission, the FBI’s Internet Crime Complaint Center, contact your bank to freeze your accounts, and find a professional lawyer.
Buying your next used car doesn’t have to be complicated. Just trust your gut and stay vigilant to make a cautious decision.