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How to avoid online car buying scams

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Buying a car online from the comfort of your living room with a few simple clicks has its perks, but it also brings some risk. As with most of the online world, scams have crept into the space. Be aware of common cons so you don’t lose money in the process of getting a new vehicle.

Common online car buying scams

The FTC (Federal Trade Commission) has some tips for online car sales —but there are a few common scams to look out for when browsing online for a car.

Identity theft

Some scammers are not only looking to swindle you out of your money but looking to gather your personal information. In this case, scammers will request information like your Social Security number, birthdate or banking numbers. Do not share any personal information with potential sellers aside from your name and phone number.

If you apply for financing through a dealer, ensure that it is licensed, legitimate and has good reviews. Otherwise, it may be better to apply for a private party auto loan outside of the dealership — or go somewhere you can confirm that the seller is above board.


This scam is when a dealer pretends to be a private seller with the intent to sell a vehicle that doesn’t comply with normal dealer regulations — meaning it has a salvaged title. This will cause major headaches and can be avoided by staying away from vehicles sold online from vacant lots, on the side of the road or even at the seller’s home.

Fake ads

When you are searching for a private sale, you may see advertisements that don’t list the VIN, or vehicle identification number. If you are not able to confirm that the vehicle exists — as in see it in person and confirm that the VIN is correct — don’t send money. It is not uncommon for scammers to present a vehicle in an advertisement without having it.  And even if the vehicle exists, confirm that it is not listed as stolen and that it has a clean vehicle history report.

Buying sight unseen

It is never a good idea to purchase a vehicle without seeing it. Not only is it best to take your potential car for a test drive and inspection, but buying sight unseen can mean the car might not look like the pictures or worse — not exist at all.

Request for wire transfer or gift cards

If the potential seller requests a wire transfer for the vehicle payment, walk away. This is a common tactic that scammers use to take your money with no vehicle in return. Wired money is not traceable and very difficult to recover. This means you may be left with no car and no potential refund.

Similar to scammers wanting payment via wire transfer, some sellers will request gift cards for the payment. Again, walk away. Gift cards are not traceable and mean the seller is likely attempting to scam you.

Title washing

Title washing is an attempt to hide damage from a wreck or flood — or other issues with the vehicle’s history. Even if you have to pay for it yourself, always get a vehicle history report for the VIN. This isn’t guaranteed to show you everything the car has gone through, but it can help you avoid falling prey to a scammer looking to offload an unsafe car.

Is online car buying a good idea?

If you go through a legitimate service, then buying a car online is just as safe as a dealership. Even if you go with a private seller, don’t let the chance of a scam happening deter you. By being an informed consumer, you will be less likely to be duped and more likely to drive away happy with your vehicle purchase.

Benefits of online car buying

If you know what scams to look out for and go through a legitimate source, buying a car online has its benefits.

  • Primarily, it saves time. You don’t have to go to multiple dealerships and deal with physically browsing inventory on a lot.
  • Buying online means unlimited shopping opportunities. Since you aren’t limited to the selection at a dealership, you may be able to find a more exact match for your needs.
  • No sales pressure — after all, you’ll likely be scrolling through websites on your phone or computer, not subjecting yourself to professional salespeople.
  • If you opt for something like Carvana or Vroom, you’ll have access to national delivery. There may be a small fee, but if you find the right car, it could be worth it.

Drawbacks of online car buying

Aside from scams, there are a few reasons people still choose traditional dealers:

  • Big online sources mean no negotiation. You will be able to negotiate with a private seller, though you will run the risk of being caught in a scam.
  • Lenders may not offer financing for a private sale when you are looking online. If they do, you may find that the rates are higher than with a new or used car loan.
  • You may not be able to do an in-person inspection until you meet with the seller or have the car delivered. And it may be more difficult to have a mechanic inspect it when you shop online.

What to do if you’ve been scammed

If you think you have fallen victim to an online scam, there are a few steps you should take.

  1. File a complaint directly with the National Consumer League’s fraud center.
  2. Contact your state attorney general.
  3. File with the FBI’s Internet Crime Complaint Center.
  4. Report the fraud to the Federal Trade Commission.

It may be difficult or impossible to get your money back if you sent it through a wire transfer or handed over gift cards. However, keep track of your bank activity if you entered any information on an illegitimate website. If you see any activity, contact your bank about the fraud and reset any usernames or passwords connected to the account.

The bottom line

If a car deal sounds too good to be true, it probably is. The key to success when it comes to avoiding potential scams is to trust your gut. Take the time to understand common scammer tactics so you can do your best to avoid losing money.

Written by
Rebecca Betterton
Auto Loans Reporter
Rebecca Betterton is the auto loans reporter for Bankrate. She specializes in assisting readers in navigating the ins and outs of securely borrowing money to purchase a car.
Edited by
Auto loans editor