The sleazy Used-Car Dealer has become such a cultural trope that car buyers hardly need to be warned to be careful when shopping for a pre-owned vehicle. But beyond kicking the tires, many consumers are unprepared to identity a used-car scam before it’s too late.
Unlike new-car scams, which usually revolve around confusion and manipulation, used-car scams tend to be about concealing important facts about the vehicle such as mileage, title history, and major repairs done (or not done).
Avoiding a used-car scam is mostly about applying instinct and common sense, but it helps to go into it knowing some of the most common ways unscrupulous sellers try to get over on used-car buyers.
1) “Just Needs Freon”
If you go to your local Craigslist and start looking at used cars, it will not be long before you come across this one. The seller writes something like “A/C needs recharge” or “just needs Freon,” which is an admission the air conditioner is not working.
Here’s the thing, though: If an air conditioning system is low on refrigerant, it means that system has a leak, which means any new refrigerant added will soon leak out just like the rest. Yes, all the auto parts stores sell air conditioner recharge kits, and yes, those kits do actually put refrigerant into your air conditioning system. But unless you’ve repaired the leak, the improved cooling will be only temporary and you’ll have wasted your money.
“Just needs Freon” more accurately translates to, “the air conditioner is broken.”
2) “Ran When Parked”
Among people who spend a lot of time shopping for used cars this phrase is a punchline. Clearly, if the vehicle ran, there would be no need to hearken back to a time in the past when it once did. The seller will often add a phrase like “Needs an alternator,” indicating the vehicle’s problem can be easily fixed. But ask yourself this: If you wanted to sell a car that didn’t run and all it needed was an easily installed $100 part, wouldn’t you go ahead and make that repair so you could sell the car more easily and for a lot more money?
What’s more likely is that the seller can’t figure out why the car won’t run and is ready for it to be someone else’s problem.
3) Odometer Fraud
After make and model nothing has a greater effect on the value of a typical used car than its mileage. This creates a natural temptation for scheming sellers to doctor the mileage reading on the odometer.
In the old days of mechanical odometers, this was done by simply raising the back wheels off the ground and putting the car in reverse, rolling back the miles just as they had rolled on in the first place. Digital odometers were supposed to combat this, but as you might imagine there is now a wealth of technology that makes it easier than ever to doctor an odometer reading.
There are two ways to discover this: The first is to use your own eyes and judgment, paying special attention to the level of wear on the rubber of the brake pedal, the steering wheel, and the seats. The second is to check the vehicle’s Carfax report, title transfers, and any available service records to cross-reference mileage.
4) Title Washing
If a vehicle has been destroyed by something like a flood, fire, or collision but is rebuilt to drivable condition, it is given something called a salvage title. This lets the buyer know that they are dealing with a car that has been destroyed, and are therefore taking a unique risk by purchasing it.
Flood-damaged cars are particularly risky purchases because while they were under water, all manner of soot and debris were able to rush into every nook and cranny. These vehicles may run fine for a while, but those components are likely to wear out rapidly and without much warning. Fire-damaged cars can be just as risky.
Because of this, scammers try to conceal the true history of the vehicle by registering it in a different state, where the DMV clerks are less likely to recognize the salvage-title markings and push it through like a regular title. In effect, they “wash” it.
To avoid this, research the vehicle’s history using the VIN to check its Carfax report and history of title transfers. If the story, or car, smells fishy, it probably is.
This one is a little bit complicated and isn’t always about scamming the buyer, but it’s a common practice any used-car customer should be aware of.
Say you show up to meet a seller and look at a car. You meet at a parking lot or on a curb somewhere (just not a dealership). Everything looks good and you agree on a price, but when it comes time to hand over the title, one of three things happens: The title is in someone else’s name, the bill of sale identifies the name of the dealer as “Seller,” or the seller takes you to a local dealership where a “helpful friend” is going to take care of the paperwork.
This is known as curbstoning, and it is usually done by dealers pretending not to be dealers, or by people who are selling so many cars that they are required by law to have a dealer license (but don’t want to pay for it or perhaps have a felony on their record). By signing the title from the person they bought it from directly to you, they have skipped the title right over their heads and behind the county’s back, allowing them to stay off the radar.
This practice doesn’t necessarily rip off the buyer, but keep in mind that one reason dealers like curbstone deals is that it can help them get rid of cars that are so flawed that no dealership would bother with them.