Online Car Buying Scams: How To Spot Them

Online car sales can be convenient. Car buyers don’t always want to head to a dealership and interact with salespersons who often try to secure overpayment plans with hefty margins above market value. But if you’re not careful, it can easily cost you thousands of dollars and leave you with less money and no new wheels to drive to work or school.

Knowing how to spot online car buying scams is a good idea. Let’s break down key signs to look for in common scams.

Prevalent Online Car Buying Scams

  • Fake Ads
  • Title Washing
  • Fraudulent Wire Transfers
  • Identity Theft
  • Gift Card Ripoffs
  • Curbstoning

Fake Ads

Because it’s difficult to catch perpetrators, there are many different online car buying scams to be wary of on any online marketplace, be it eBay Motors or Craigslist.

The first of these is fake car advertisements. For example, a hypothetical car seller will advertise a vehicle they don't own. Scams can be pretty elaborate; the scammer in question may have photos that match the car's description and legitimate contact information, like a phone number.

You can avoid this scam by asking for more details about the car, like the VIN or vehicle identification number. Furthermore, never meet a private seller for a deal if they don’t let you inspect the vehicle (and want you to buy the car online while just taking their word for it) or don’t want to meet in person.

Title Washing

Some fraudsters may try title-washing vehicles. Title washing means erasing a vehicle's history, like any prior accidents, where it has been, and who has owned the car.

Title washing is particularly dangerous because it often occurs in stolen or illegal vehicles. You can avoid getting scammed by a title washing scheme if you order a vehicle history report from a trusted organization like Carfax before buying it.

Fraudulent Wire Transfers

Fraudulent wire transfers are also common online car buying scams. Always say no if the so-called car seller wants you to exchange money through a wire transfer.

It is almost impossible to get your money back via a wire transfer once it goes through. Furthermore, many fraudulent wire transfer schemes require you to wire a “small balance” or a down payment of the car’s total price before you can see it. Again, never agree to these conditions. There’s always another car to buy from a trustworthy seller.

Identity Theft

In the worst-case scenario, the scammer may not necessarily care whether you buy a car or not. Instead, they are after your details so they can steal your identity.

Specifically, identity thieves usually try to recover your Social Security number, car maintenance records, or bank account numbers. Therefore, you should always be careful in providing personal information to anyone over the Internet.

Never give information to an online car seller who refuses to provide more details. Legitimate buyers likely won’t need your driver’s license or Paypal details upfront, so if they ask, you should count it as a red flag. Furthermore, a car seller should never need your personal information, like your date of birth or Social Security number, until you are signing paperwork in person to purchase the vehicle.

If a car seller asks for personal info, say no and move on.

Gift Card Ripoffs

One surefire online car scam is a request that you pay for a vehicle with gift cards. Not only is this ludicrous on its face (you would need dozens, if not hundreds, of gift cards to pay for a vehicle worth thousands of dollars), but it’s always a sign that the scammer just wants the cards loaded with money so they can steal the numbers for the cards and sell them online.

If a car seller tries to get you to pay with gift cards, click out of the conversation and look elsewhere.


Lastly, “curbstoner” car scammers sell used cars without having the appropriate permits or paperwork, let alone the proper license. Most of these scammers don’t even have a regular place of business.

Most curb stoning fraudulent deals happen in shady locations like vacant parking lots or on the curb in front of a person’s home, hence the name. To avoid getting scammed this way, try to buy cars only from reputable sellers, those who run online businesses with licenses you can verify, and owners who are fine selling your vehicle in front of a public place like a police station.

Three Tips To Stay Safe from Scammers

  • Meet in Person, and Bring a Friend
  • Only Take Cash
  • Consider an Escrow Account

Meet in Person, and Bring a Friend

Aside from knowing the common online car buying scams, there are ways to keep yourself safe from scammers of all stripes.

The first way is to always insist on meeting the car seller in person. Whenever you set up an in-person deal, bring a friend or family number along, particularly if you travel a significant distance from your home.

Only Take Cash

Next, only accept cash deals when buying a car from an online seller, especially if you’re buying from out of state. This prevents them from getting a hold of your personal information or learning your credit card information, for example.

Consider an Escrow Account

It may also be a good idea to use an escrow account. With an escrow service, an unbiased third party holds the money that gets exchanged in the deal. You and the car seller are aware of the escrow account and location, and you can take a car on a test drive.

Once you inspect the car and decide to buy it, you and the car seller can go to the bank with the escrow account. The seller can withdraw the money after the deal finalizes. However, verify that the escrow provider is legit and not a fake escrow service.

What To Do If You’ve Been Scammed

Even if you take proper precautions, it’s still possible to become the victim of a car scam. If you get victimized by an online scam, there are some steps you can take:

  • Firstly, you can contact the Better Business Bureau to let them know about the scammer, as well as contact your state's attorney general's office
  • Next, be sure to file a complaint with the FBI via the Internet Crime Complaint Center
  • Report the fraud to the Federal Trade Commission, so the scammer is put on their radar as well
  • If your scam occurred due to wire transfer fraud, try to contact the company that facilitated the wire transfer and see if you can get your money back
  • If you disclose any personal information in the deal, change your usernames and passwords to your important accounts, like your bank accounts
  • Don’t forget to constantly monitor your credit reports so you can see suspicious activity in the wake of a scam. This is also one of the best ways to watch for identity theft

Bottom Line

Overall, trust your gut. It probably is if something seems too good to be true or if you think a potential car deal is a scam. It's better to be safe than sorry, especially when buying something as expensive and vital as a new car online.

But if you find a great deal, rest assured you can rely on Carvaygo to get your new car to your doorstep in one piece. With Carvaygo, you can ship your new vehicle from place to place or have it delivered precisely to your specifications. Contact us today to learn more.

Escrow Accounts and How They Work | Wells Fargo
Internet Crime Complaint Center | IC3
What is Curbstoning, and How Can You Avoid It? | Capital One Auto Navigator

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