How to Stay Safe When Buying Your Car

Whether your new ride rolls up to the driveway with a big novelty bow on top or you’re just browsing around between work and downtime, buying a new car can be exciting. Brand new wheels mark a truly special occasion, especially as Americans fall on the more frugal side of long-term car ownership – insurance company The Zebra estimates that we keep our cars for about 8 years, on average. 

That’s a big commitment, isn’t it? For most, car purchases come second only in importance and price tag to home purchases, so it’s vital that you steer clear of red flags and common scams (more so on the used car end, but it never hurts to be mindful when shopping new) to ensure that you start your journey off on the right foot. Or the right tire.

Mechanical Warning Signs

So, what are possible red flags or signs of a scam when buying a car? Let’s start with the lifeblood of any vehicle: the engine.

You don’t have to be a mechanic to know that the most alarming warning signs start here, and you don’t have to be a mechanic to spot them, either. In this case, your ears are your best friend. Knocking, rattling, or strange vibrations are sending you a message, and that message is, “run.” Trust your nose, too – burning odors may indicate engine problems, while moldy or mildewy scents are often a sign of HVAC issues or water damage.

Other bad omens include telltale signs of leaks under the car, rust-colored coolant, dented underbody components, and joints that are leaking or seeping grease. 

If you’re close to buying or have just purchased a vehicle and are still under the protection of local lemon laws, it’s never a bad idea to spend the $100 or so and bring your new sled to a trusted mechanic for a general inspection, just to make sure everything is above board. If the seller objects to such an inspection, consider that bad juju. Do your research on automotive recalls, as well; if the model you’re considering has a history of any major recalls, ensure that it’s been addressed in its service history. 

Peep the Cosmetics, Too

When buying a car, you want to be absolutely sure to get a detailed, officially endorsed report of its history (such as a Carfax report) that includes everything from maintenance records to accidents. But alongside this report, you can also use your own two eyes to spot potential issues. Exterior blemishes like inconsistent paint or texture, rust spots, ratty tailpipes and misaligned body panels or gaps between those panels may indicate that the seller is trying to hide a history of accidents or major repairs, or they may simply hint at a generally poor condition. It’s a little tougher to spot, but any signs of tampering with the car’s VIN are a big no-go. 

While high mileage isn’t always a deal-breaker (though very high mileage on a newer vehicle does raise suspicion), inspecting the cosmetic condition of the car can help give you an idea of how the car has been cared for over its lifespan. Aesthetic clues such as excessive interior wear, worn-out seats, or peeling interior features can indicate a car that’s been driven hard. As a general rule of thumb, the previous owner’s care habits – and adherence to the manufacturer’s recommended maintenance schedule – can be just as important as miles on the odometer. 

Legal and Sales-Related Red Flags

On the list of what to look for when buying a used car, a Carfax, AutoCheck, National Motor Vehicle Title Information System, or similar report and a complete, legit title should be at the top of the list of green flags. Titles with a “salvage” or “rebuilt” status may indicate hiccups down the line, as well as lesser resale value and significantly lower insurance payouts in the case of a total loss; they’re not the end of the world, but you’ll need detailed info on what caused the status. Consider it suspect if the seller isn’t upfront about these statuses, too. Incomplete maintenance records can also be a warning sign that the car hasn’t been properly maintained, or even that the odometer has been tampered with (a common form of auto sales fraud). 

On that report, make sure maintenance records line up as closely as possible with the manufacturer’s recommended maintenance schedule for the model (which you can easily Google if the car doesn’t include the original manual), and that the VIN on the reports and title matches the physical VIN on the car itself. If major repairs have been done, a thorough explanation from the seller is the absolute bare minimum you should expect. If any liens are currently placed on the vehicle, make absolutely certain that they’re released before you close the deal. 

For most dealers, the Federal Trade Commission requires the disclosure of warranty details and known vehicle issues, and if you negotiate changes during the sales process, those must legally be reflected in the sales contract. Long story short? Make sure any offers of money-back guarantees, returns, warranties, or ongoing service arrangements are put down in writing rather than relying on a word and a handshake. 

Common Scams

Not only do you need to know what to look for when buying a used car at the lot (or the website) in terms of mechanical, legal, and person-to-person red flags, but you also need to protect yourself from scams that intend to rob you of more than just a high-quality ride. 

While prices that are too good to be true, wildly fluctuating price adjustments, excessive finance charges, and pushy salespeople are definitely red flags in the general sense, don’t forget to keep a keen eye on more specific scams, such as:

• Upfront payment scams: Also known as the “Must Sell Now Scam,” this usually involves a car being advertised at a massive discount, often because of some “emergency” situation – and you’ll be asked to give a partial payment upfront before the seller ghosts you. The FBI estimates that this one has cost car buyers more than $54 million. As a rule, never pay for a car sight unseen, not even a partial payment or “deposit.” 
• Wire transfer scams: See above, and pair it with some excuse from the seller about how they can’t deliver the vehicle to you until you wire them some money. For your safety, don’t pay for a vehicle via ACH or other wire transfer.  
• Curbstoning: In this grift, car dealers pose as private sellers to get around regulations such as lemon laws (state laws that offer de facto vehicle return protection for certain issues during a specific time or mileage period). Use a Spokeo People Search to make sure they are who they claim to be.  
• Gift card scams: Ah, we know this old chestnut from phishing, smishing, and quishing scams. Here, you’ll be asked to pay for the car using gift cards equivalent to the sale price (often Bitcoin or crypto-related – perennial grifter faves). Scammers want these cards because they’re untraceable, so the payment history will be as nonexistent as the car you receive. 
• VIN and title trickery: “Title washing” is when sellers issue vehicle history reports scrubbed of negative issues, so if you have any suspicions at all, don’t hesitate to seek out your own reports. Similarly, “VIN cloning” is when sellers swap out a lemon’s VIN for that of the same model with a cleaner history. Double-check those physical VINs for tampering and look for discrepancies on those reports and the car itself, otherwise, you risk mechanical issues or even repossession. 
• Fake purchase protection: This one’s a little more subtle. Some sketchy sellers will offer phony purchase protection with familiar branding. You’ll pay real money for fake service, so always make sure the company’s contact info matches up with whatever you’re seeing on the seller’s offer. 

Swerve Away from Scams with Spokeo

Alongside a Carfax, AutoCheck, or National Motor Vehicle Title Information System report, head over to the National Insurance Crime Bureau and enter your potential new vehicle’s VIN into VINCheck lookup, a free service that’ll give you a heads up if the car has been reported as a salvage vehicle or has a record as an insurance theft claim. Reports like these are absolutely essential to safe car buying, but they don’t cover one crucial element of the process: the human element. 

For dealers, online reviews are important, but private sellers don’t exactly have a Yelp page. Make sure private sellers are who they say they are with a Spokeo People Search, which combs through billions of records based on a name, phone number, physical address, or email address. Even for dealers, it never hurts to supplement that glowing 4.8-star Google Review average with a quick People Search – just a few clicks will scour 89 million business records, too. 

There’s really nothing like that “new car” smell. Just make sure it doesn’t smell fishy. Or phishy, for that matter. 

As a freelance writer, small business owner, and consultant with more than a decade of experience, Dan has been fortunate enough to collaborate with leading brands including Microsoft, Fortune, Verizon, Discover, Office Depot, The Motley Fool, and more. He currently resides in Dallas, TX.