8 Used Car Dealer Scams and How to Avoid Them When Buying

• Common Used Car Scams to Watch Out For
• How to Protect Yourself from Used Car Scams
• How to Sell a Car Without Getting Scammed
• What to Do If You’ve Been Scammed

Purchasing a secondhand automobile is sometimes fraught with uncertainties. Buying from a private seller or dealership might save money, but dishonest tactics can make it a financial nightmare. Knowing how to protect yourself is essential since frauds like title fraud, odometer rollbacks, and others are frequent. The market's most commonly used car scams are examined here, explaining how they operate and providing helpful tips to help you stay safe.

Common Used Car Scams to Watch Out For

Odometer Rollback: How Sellers Trick Buyers

One of the most common car dealership scams is odometer rollback. Sellers adjust a vehicle's mileage to make it seem like it has fewer miles than it does. This artificially inflates the car’s value, allowing the scammer to demand a higher price for a vehicle that may have seen significant wear and tear. Odometer rollbacks are particularly common in older cars, but modern digital odometers are also susceptible.

To avoid this scam, always request a vehicle history report from a reputable service like Carfax to protect yourself from a potential car history audit scam. Check the mileage against service records, and be on the lookout for any signs of tampering around the odometer. Mileage that doesn’t align with the car's condition (like excessive wear on the steering wheel or pedals) is also a red flag for dealership scams.

Title Washing: The Hidden Danger of Clean Titles

Title washing is the practice of altering a vehicle’s title to conceal its troubled past, particularly when the car has been branded as a salvage or flood-damaged vehicle.  Scammers move the vehicle between states with looser regulations to “wash” the title, giving it a clean slate and making it appear as if it is a сertified pre-owned vehicle.

Protect yourself by always verifying the vehicle's history through trusted sources like the National Motor Vehicle Title Information System (NMVTIS). Cross-check the title with other records, and avoid cars priced far below market value — this could indicate scams when buying a car that the seller is trying to hide.

Curbstoning: Avoiding Illegal Car Sales

Curbstoning is the practice of unlicensed dealers posing as private individuals to sell used cars for sale. These sellers often operate out of parking lots or other informal settings to avoid taxes and regulations, making it difficult to hold them accountable if something goes wrong. Vehicles sold through curbstoning are often defective, stolen, or improperly documented.

To protect yourself, avoid transactions that seem too casual or where the seller is reluctant to meet at a home or office, as this could indicate potential parking lot scams. Check the seller’s identification and make sure the name on the title matches their ID. If the seller refuses to produce proper documentation, walk away.

Online Car Buying Scams and Fake Listings

The convenience of online shopping has expanded to the car market, but so have the risks. Scammers often create fake listings on websites like Craigslist or Facebook Marketplace, posting pictures of cars that don’t exist or that they don’t own. These scams, which can also include car finance scams, lure buyers in with incredibly low prices, then ask for a deposit or full payment upfront, only for the car to never arrive.

To avoid these car-buying scams, always be wary of sellers who ask for money before you’ve seen the car in person. Use well-known platforms, like Autotrader or CarGurus, that offer protection and verification. Never wire money or send a payment through services like Western Union, as these are difficult to trace.

Vehicle History Report Scams

Vehicle history reports are supposed to offer transparency, but scammers have found ways to forge or manipulate them. Vehicle report scams involve falsifying documents to hide a car’s problematic past, including accidents, mileage discrepancies, or title issues. 

To avoid this, always request a report from a trusted provider like Carfax or AutoCheck, and cross-check the vehicle's history with records from the DMV, particularly when looking at used SUVs for sale. Be skeptical of sellers who hesitate to provide this information or suggest lesser-known history reporting services.

How to Avoid Flood-Damaged Cars

After major floods, many water-damaged vehicles are cleaned up and sold without disclosing their past, making it a common car buying scam. Water or other hidden damage can wreak havoc on a vehicle’s electrical systems, brakes, and engine components, even if the car appears clean on the surface. Flood damage may also promote the growth of mold and mildew, creating health risks for passengers.

To identify flood-damaged cars, look for signs like rust under the seats, water stains in the upholstery, or a musty smell in the cabin. Check the car’s history for flood damage reports, especially if the car comes from an area recently affected by severe weather.

VIN Cloning: How Scammers Steal Vehicle Identities

VIN number scams involve taking a vehicle identification number (VIN) from a legitimate car and placing it on a stolen or salvaged vehicle. This creates a “clone” car with a seemingly clean title, allowing scammers to sell it to unsuspecting buyers. This car scam is particularly difficult to detect without thorough research.

To avoid VIN scams, compare the VIN on the car’s dashboard with the one listed on the title and registration documents. Run a check with a service like the NMVTIS to ensure the VIN hasn’t been used for fraud, especially if you're wondering, “Is it safe to give VIN number to buyer?”

Dealing with Fake Car Inspection Reports

Some sellers may try to convince you their car is in perfect condition by presenting car inspection reports from a fake dealership. A common variation of this scam occurs with online listings, where the seller claims the car has been inspected and approved by a mechanic who doesn’t exist.

Always insist on getting your independent inspection. Even if the seller provides documentation, hiring a trusted mechanic to conduct a thorough check can reveal hidden problems that may indicate car fraud the seller hasn't disclosed.

How to Protect Yourself from Used Car Scams

When buying a used car, it’s critical to remain vigilant. Here are some tips to help you avoid car dealer scams and private seller fraud:

• Do your research. When buying from a dealer or a private seller, always research the seller's reputation. Look into dealer fees, read reviews, ask for references, and confirm the seller’s credentials.
• Verify vehicle history reports. Always request a report from reputable services and cross-check it with DMV records. Be wary of any inconsistencies.
• Get an independent inspection. No matter what the seller claims, always hire your mechanic to inspect the vehicle before buying it. This step can uncover hidden issues or fake car ownership documents that the seller may not want you to see.
• Don’t rush the process. Scammers often push for a quick sale to prevent you from doing your due diligence. Take your time, ask questions, and be wary of sellers who seem overly eager to close the deal.
• Check the paperwork. Ensure all titles, registrations, and VINs match up, and avoid making payments until all paperwork is verified and complete.

How to Sell a Car Without Getting Scammed

Even sellers aren’t immune to scams. Here’s how to avoid car selling scams when offering your vehicle for sale:

• Vet your buyers. Be cautious of buyers who offer to pay more than your asking price or insist on paying in unconventional ways like wire transfers.
• Meet in safe locations. Always arrange to meet potential buyers in a public place, such as a police station parking lot or other good places to buy used cars. Never invite a stranger to your home.
• Use secure payment methods. Avoid accepting personal checks, money orders, or payments through risky services. Opt for safe transactions through banks or verified online platforms.
• Protect your VIN. Scammers may ask for your VIN to perform identity fraud. Only provide the VIN to serious, verified buyers; be cautious about sharing it.

Recall that to safeguard yourself during the process, it matters to understand how to sell a car without getting scammed to protect yourself throughout the process.

What to Do If You’ve Been Scammed

Unfortunately, even the most cautious buyers and sellers can fall victim to fraud. If you’ve been involved in a car sale scam, here’s what to do if scammed by car dealership:

• Contact the authorities. Report the scam to local law enforcement, providing all the details and documentation you have.
• Notify your bank or payment provider. If you’ve made any payments, contact your financial institution to stop the transaction and recover your funds if possible.
• Alert the DMV. Scammers often manipulate car titles, so filing a report with the DMV can help prevent future fraud involving your vehicle, especially in private car buying scams.

File a complaint with the FTC. The Federal Trade Commission can investigate car sales scams and act against fraudsters. If you are considering a used car dealer in Pennsylvania, it’s crucial to share your experience to help protect others from similar scams.