Buying a Car on Craigslist: A Guide to Avoid Getting Scammed
Buying or selling a car directly instead of through a dealership or car lot can mean more money in your pocket. If you’re buying, a private deal could mean major savings on an expensive purchase. And selling a car in a private deal means you’re not paying a business to do it for you.
But there is risk in making private deals. There’s usually a few thousand dollars on the line and cars are complicated, expensive equipment — so some people will always work hard to trick others out of their hard-earned money. Here’s how to avoid the most common car scams when buying a car on Craigslist.
Know the value
When you find a car you like on Craigslist, look up what it should cost on NADAguides (from the National Automobile Dealers Association) or Kelley Blue Book. You can specify the exact model car you’re looking at, its condition, location and that you’re buying from a dealer or a person — and, presto, you have what the car is worth. This is the value the banks use when deciding loans.
- If the vehicle is way overpriced. It’s likely not a scam. The seller probably overpriced it in order to give themselves some “wiggle room” in negotiations. They may expect potential buyers to make lower offers.
- If the vehicle is way underpriced. This might be a scam. A price that’s way too low, like a $10,000 car with a $6,000 price, might have major problems the seller isn’t disclosing, which add up to cost more than the $4,000 difference to fix. If the seller tells a personal story to explain this deal that’s too good to be true, the story probably isn’t true, either. Don’t feel sorry for them and buy the car unless you have a professional mechanic do a thorough check first.
- If the price is oddly specific. If the price given is down to the dollar, such as $4,786, it may be a scam.
Do not pay anything upfront
A scammer could ask for a down payment for you to “reserve” the car or prove you’re a “serious buyer.” If you are taking out a loan for the car, you would most likely give any down payment to the lender, not the seller. Talk to your specific lender about this before any money changes hands.
And if you’re looking for a private-party auto loan, consider filling out an online form at LendingTree. You could get up to five potential auto loan offers from lenders to compare and choose the best deal from. It does not hurt your credit to do multiple loan applications any more than it does to do one within a 14-day window.
Look at the photos
First, there should be photos. All buyers want photos. A picture is worth a thousand words, after all. When you look at car photos, don’t just look for dents or signs of rust. Other clues could reveal that the seller is a scammer.
- The car in the photo doesn’t match the car described. For example, the photos show a Honda Civic, but the description text says it’s a Toyota Corolla.
- The photo’s background doesn’t match the location. For example, the background in the car photo shows mountains, but it’s supposed to be located down the street from you in southern Nevada. Or if it’s supposed to be in the mountains and there are only photos of it surrounded by palm trees.
- A Google image search comes up with the same photos. If the photos seem too professional or if you just have a suspicion, do a Google image search for the car, make and model. The scammer might have taken photos that popped up on Google and pasted them in the ad.
Beware an out-of-the-country deal
If the car or the seller is in another country, it’s more than likely a scam. Even if the person says they’re in the military or they’ll ship the vehicle to you, don’t believe it. International paperwork, taxes and tariffs can be a major cost and a major pain. And shipping the vehicle might cost more than what you would pay for the whole car. It’s best not to touch a supposed international car deal at all.
Watch for a “protected” purchase
If the seller mentions the transaction is protected in some way, such as with eBay purchase protection or Paypal insurance, walk away. This is Craigslist, not eBay, and Paypal does not guarantee or insure any sale done in-person.
A large red flag is if the person tries to rush you and seems to be in a hurry or anxious. This means they don’t want you to have time to think about it or do research.
Do not give more personal info than what’s on your driver’s license
Do not provide your Social Security number for any reason. There is no reason a car seller would need it. If you are taking out a loan, the lender will ask for it, but that has nothing to do with the seller. (If the seller is the lender, that’s another story and you can read more about private party auto loans here.) Do not give your bank account number, your mother’s maiden name, your employment information, a copy of your passport or anything else to the seller.
You will need to write your full legal name and address on the title, but there’s no real need to voluntarily share that information until you finally sign a title. If the seller does ask for a photo of your driver’s license, that’s not a usual request. You could cover up your driver’s license identification number in the photo if you want or ask for the seller to share theirs as well.
Ask for a photo of their driver’s license
As a government-issued ID, a driver’s license is an official source of personally identifiable information — you’ll know who you’re dealing with. This is a quick way to stop out-of-country scammers, and you could have a quick way to report them if they turn out to be a scammer.
Ask for a photo of the title
A car title is a legal form that identifies the vehicle and its owner. You can get a bunch of information from it, including the VIN (vehicle identification number), the current owner information and whether the car has been declared salvage, meaning it was severely damaged or considered a total loss. If the owner refuses to share a photo of the title, ask for the title number and the VIN at least.
Do a free title search
You can enter the title number into the National Motor Vehicle Title Information System or your state’s DMV website to do a free title search. This will tell you if the title is “free and clear,” which means that the person using it owns it, doesn’t owe anything on it and that the government doesn’t have a lien against it for unpaid tickets. You’ll also be able to see whether the vehicle has a salvage title.
Compare the driver’s license to the title
If the owner provides a photo of the title, check the driver’s license against the information on the title. The owner’s address may be different (they could have moved) but the name should be exactly the same. Differences could signal that the car was stolen, the title is fake or it was severely damaged.
- Small spelling differences, or the lack or addition of a middle name. If this is the case, call your state’s DMV to make sure this is OK and nothing needs to be notarized.
- Completely different name. It’s probably a scam. This means a completely different person owns the car and the person you’re talking to doesn’t have the right to sell it.
- Bank name. If the current owner took out a loan to get the car, the title may show the lender as the owner. If it shows this and there is not a “release of lien,” the person might still owe money on the vehicle and doesn’t have the right to sell it. If there’s any question in your mind, go to your state’s DMV website to do a title check. It should show whether there is a lien and if the title is clear.
- A second name. If there are two names on the title with the word “or” between them, either one of those people can legally sign the car over; you don’t need both people. If the word between the names is “and,” both of those people need to sign the title for it to count as a legal sale.
- A dealership name. Some states require a dealership or car lot to be listed as an owner on the title if that business buys the car to sell it. If you see an auto business name as the current owner in a Craigslist deal, then it is pretending to be a private owner to sell it. This is called curbstoning — a process used to sell damaged cars, particularly ones that went through a major weather event that damaged thousands of cars, such as a hurricane. It’s probably a scam.
Get a vehicle history report
There are many ways to do this; the costs can vary from free to $40.
- Free. Check recall information from National Highway Traffic Safety Administration. A recall is when a manufacturer offers a free repair to fix a safety defect. The car might not be safe until recalls are addressed.
- $3 to $13. You can get a vehicle history report from the National Motor Vehicle Title Information System, which provides the state(s) the vehicle was in, odometer data, theft and salvage history.
- $25 to $40. Getting a vehicle history report from Carfax or AutoCheck will likely provide all of the above information, plus maintenance records and whether the car was in an accident (and, if so, how bad it was).
Get a safety inspection
Either ask the seller to take the vehicle to an independent mechanic for a safety inspection or ask if you can take it to one. This way, you’ll know for sure if the vehicle is in good shape or if it’ll break down on you three days after you buy it. You could also use any repairs that need to be done as a negotiating point. A thorough inspection could cost you $100, but it could save you blood, sweat, tears and a few thousand dollars.
You can read this for more information on how to avoid getting a lemon car or look up your state’s lemon laws by searching on your state’s DMV or attorney general’s site.
Meet the person in a public place
Don’t meet them in their neighborhood, your neighborhood or a dark alley, if you can help it. They may be counting on you bringing cash (or the title, if you’re the seller). Meet in a public area with plenty of other people around, such as a shopping center. It would be best if you could meet them near your bank.
Do not wire money
This is an extremely common way for scams to work because they are largely untraceable and can be faked. Do not use gift cards, cashier’s checks, certified checks, money orders, Western Union or a similar service, or an escrow service. If the person demands this, walk away — don’t make a deal with them.
This is the safest way to purchase the car. You can meet at your bank and hand over the cash to the seller right at the counter — in plain view of security cameras.