Along with the number of consumers
conducting transactions online, internet fraud has increased during the
past several years. Big-ticket transactions are a primary target, but that
shouldn't discourage you from selling your car on your own. Go for it,
but be cautious and educate yourself about potential scams.
Be on the lookout for the following
ways you can be lured into a scam:
Cashier's Check Scams
In a typical scenario, a buyer - who
usually inquires from overseas - arranges to pay for the car with
a cashier's check or certified check in an amount that's more than the
vehicle's purchase price. The buyer justifies this by saying a previous
sale fell through or the extra money is needed to pay for shipping expenses
or customs fees.
The buyer then asks the seller to
wire the difference either to him or to the shipping company to cover expenses.
Or a buyer will send a cashier's check as a down payment, then decide to
back out of the deal and ask for the money back.
When asked to wire money, just say
no. It's never a good idea to wire money to someone you don't know because
it's an untraceable transaction. Stop negotiating with anyone who proposes
this kind of bargain.
Phony Escrow Services
Escrow services serve as middlemen
between buyers and sellers. They collect payments from buyers, wait until
the buyers collect and approve the purchases, and then send the money to
the sellers.
The internet is littered with bogus
escrow sites, so make sure you use a licensed, reputable service. CarBaaz.com
recommends Escrow.com.
Never blindly accept an escrow service
proposed by a buyer. If a buyer insists on using a service other than Escrow.com,
find a new buyer.
Below is an actual fraud email sent
to a CarBaaz.com seller:
Hello,
Thanks for the email. I am interested and would be willing to buy it at that
price ($3,500). I have an International shipping agent that will come pick
it up from your (HOUSE) and ship to me. I will arrange for payment by sending
your full name, address, state, city, ZIP code, country, telephone no./mobile
no to my client in the states who is owing me the amount of ($8,000) to issue
you a check for this amount, which is a refund for a cancelled order I placed
with him, and being a refund the amount can only be written on a single check.
I know it is more than the (car) price but after getting the check, I need
you to cash it and deduct cost of the (car), then do me a favor of wiring the
remaining balance to my international shipper via Western Union. I will also
compensate you with ($50) for removing the advert from the net. After this
is done and he gets the money, he will then pick it up from your residence
and ship to me. So, confirm this and send your full name and address including
phone number for mailing the check payment to you as soon as possible. Waiting
for your urgent reply,
Few people would buy a car from a
dealer without test-driving it first, and the same is true when dealing
with a private-party seller. It may seem odd to hand your keys to a stranger,
but the process should run smoothly if you follow these tips:
It's best to meet potential buyers somewhere other than your
home. When possible, bring along a friend for peace of mind — but
in any case, make sure family or friends know of your plans.
CarBaaz.com strongly recommends that you accompany prospective
buyers on the test drive. This gives you more selling time, and it
spares you the distress of watching a stranger drive away in your
car. When riding along, point out all the features you love about
your car, including things you didn't mention in your ad. You've
got a captive audience, so make the most of your time.
If the buyer makes a special request to go it alone — and
you feel comfortable with that — make a copy of his or her
driver's license (assuming you don't have quick access to a
copy machine, simply jot down their name, address and driver's
license number). Set a time limit on the test drive, and exchange
cell phone numbers as a backup strategy. Also, confirm that
the driver's license
information meshes with what you were told initially.
Pre-plan a general route that allows the buyer to experience
a variety of driving situations during the test drive. Give them
the opportunity to drive on the highway and in local traffic, as
well as maneuver the vehicle in a parking lot.
Liability shouldn't be an issue. Many insurance policies
cover other people who drive your car so long as they're doing so
with your permission and have a valid driver's license. Verify your
policy's details; if it doesn't offer this protection, ask to see
proof of the shopper's insurance. Make sure the driver has full coverage,
which includes collision, liability and comprehensive.
Whether you're dealing with a buyer
in person, via email or over the telephone, always be careful when accepting
payment. Scam artists are deceitful and good at what they do, so remember
these steps to make yourself less vulnerable.
Never wire money to a potential buyer
under any circumstances. If a buyer pays via a check or money order,
accept only the exact amount of the selling price of the vehicle.
Confirm with the issuing bank that the
check is valid. Look up contact information for the bank on your
own, as a forged check likely will include a phony bank address and
phone number.
When possible, go to the bank with the buyer to verify the
check's authenticity. In addition, it's a good idea to request a
cashier's check drawn from a local branch.
Stick to your timeline and don't rush the transaction. If
the bank is closed when the buyer wants to pay you, then hold
off until you can verify the check's validity. If possible, wait
until
the check clears the bank before handing over ownership of the vehicle.
How long that takes depends on your bank, but it should be less than
a week.
If the buyer chooses to pay by money order, follow the safe-payment
guidelines for accepting checks. Verify the name and amount with
the issuing bank, and request a money order from a local bank whenever
possible.
If those methods leave you feeling squeamish, there's always cold,
hard cash. Your best bet, however, may be Escrow.com. It's legitimate
and offers equal protection for buyers and sellers. If fraud fear
keeps you awake at night, Escrow.com is the way to go.
Transferring ownership to the buyer
is easy, but details vary by state. We list a few guidelines regarding
this part of the transaction, but check with your local Department of Motor
Vehicles for location-specific details:
Before potential buyers take their first look at your car,
make sure you have the title in your possession - provided the
car is paid off. You'll need to sign this over to the new owner. If
you don't know where your title is at or how to obtain one, see Prepping
Your Car for Sale.
Ownership-transfer legalities vary from state to state, so
get the details from your local DMV.
To avoid future liability, notify the DMV that you sold your
car. States have different mechanisms for gathering this information — some
require you to file a notice of sale after you've signed over the title
to the new owner. Make sure you research your local requirements completely
and fulfill every condition.
It's a good idea to fill out a bill of sale (requires free
Adobe Acrobat Reader), which is included in CarBaaz.com's Selling Tools,
even though it doesn't legally transfer ownership. Some states make
this a requirement. A bill of sale lists the car's vehicle identification
number, a description of the car, the date of sale, the purchase price,
and the names and signatures of both parties in the transaction.
You decided to post an ad and you
found a buyer - now it's time to say goodbye to your car. Here are
a few last-minute reminders:
Don't jump the gun; make sure the sale
is secure. If you accepted payment via a cashier's check, follow
the steps in the Safe Payment section to ensure it's valid before
signing over the title. If you used an escrow service, wait until
it tells you that payment has officially been received.
If you're dealing with an out-of-town
buyer, arrange for that person to pick up the vehicle. You also could
consider employing a professional delivery service. Delivery services
transport vehicles on large hauling trucks. Prices vary depending
on the length of the transport and the vehicle's weight. The cost
usually starts at about $500. Work out the cost and payment issues
with the buyer first. CarBaaz.com recommends Dependable Auto Shippers.
The license plates stay with the seller,
not the car, in most tates. If the plates remain with the original
owner, remove them so you don't retain a legal tie to the car.
If
the plates stay with the car, you need to fill out the proper
paperwork at the Department of Motor Vehicles so the plates
transfer to the new owner.
Call your insurance company and remove
the vehicle from your policy.
As long as you were forthright with information
about your car in the selling process, you shouldn't be liable for
anything once the sale is complete. In most states, the law assumes
that private-party sales carry "as is" status. Still, it
doesn't hurt to get that understanding in writing. Have both parties
sign off before the transaction is complete. CarBaaz.com's Bill of Sale
includes this language.
