In today's COVID market, we're seeing scams pop up more and more. Here are some things you should look out for.
1. The price is too good to be true.
Obvious, but you'd be surprised how many people post a completely fake ad of a Nissan GT-R for $25,000 and ask if it's the deal of the century.
If it were legit, it would have been bought long before you stumbled across it.
Many of these deals pop up on Craigslist and CarGurus with legit photos from other active listings or listings of cars sold recently.
They'll ask for an immediate deposit or payment for the whole car via Western Union or cashiers check via mail, take your money, and block you.
It's just not worth it.
2. Every car at the selling dealer is priced below market average.
If a dealer has every car on their lot priced extremely attractively, they're all salvage or branded title cars.
Most of them won't even list the VINs (and certainly not the CarFax).
Stay away from these dealers entirely.
3. The seller is "overseas" and their mom/cousin/friend/etc is handling the transaction.
If you can't work directly with the owner of the car, don't buy it.
This scam usually involves cars that are either stolen or reported stolen and repossessed from you after the sale.
They convince you that you can have the car now, but they'll sign the paperwork when they return.
4. They want to use an escrow service.
The scammer will demand using a fake escrow service that will hold funds involved in the transaction until both parties are satisfied that the transaction has been completed.
The scam seller will offer to ship the car and that there is no risk of fraud due to the "escrow" service (including eBay, PayPal, or another service).
Once the money is transferred to their bank, they will either break contact or sometimes request additional payment due to some unforeseen bullshit.
In any case, you never receive a car and lose your money.
5. They lean on CarGurus or KBB Price Guidance to assure it's a good deal.
As I've said many times over, KBB, CarGurus, TrueCar, etc are not appropriate barometers for what a good deal on a car is.
Think about it for a second: who is paying for those services?
Dealers or customers?
That's right, their customers are all CAR DEALERS, and their tools are all built to benefit the dealer first, customer second.
"It's $500 below KBB!" means absolutely nothing, especially on an exotic car where the data is often missing major factors like big $$ options, or is fraudulent to being with.
While those are tell tale signs of possible scams, here's how you can confirm your suspicions.
1. Ask for the CarFax report.
Any legitimate dealer will be more than happy to provide you a copy of the CarFax report for free.
If a dealer denies then there is something fishy going on.
If you do receive the CarFax, and the seller is a dealer, look at the history of it.
Is it being sold by the same dealer on the report?
Does the story of the car match where it's from?
If it's a private seller, does the last registration location match where the car is now?
2. Google the seller.
In this industry, specifically with high-end cars, your reputation matters.
A simple Google search will reveal much more telling information about the seller or dealer.
Things to look out for are...
Are the reviews positive or negative?
Are there any complaints on DealerRater, Yelp, Better Business Bureau, eBay, etc?
Does the dealer even exist at said address?
Use Google maps and street view to get insight of the area.
Is it in run down C-Class neighborhood?
You never want to buy a luxury or exotic from a dealer that usually sells 1995 Ford Explorers.
3. Ask specific questions.
You don't have to be annoying, but it's ok to try to poke some holes in the sellers claims.
Ask for very specific photos like of the interior trim, VIN numbers, tire tread... or even a walkaround video.
Some people even request live Facetime videos too.
If a seller resists, backtracks, or disappears completely, it's clearly a scam.
4. Google the VIN.
Cars that are listed online always have a digital trail.
Simply Google the VIN and you will be able to pull up some (not all) history about the car, including previous listings.
As I mentioned, one obvious sign of a scam is if the new 'seller' is simple re-using old photos.
Some tools like VinWiki can even shed more info when it comes to exotic cars with their crowd-sourced info.
5. Ask for references or identification.
This is more for private sellers but it's totally OK to ask for a copy of the drivers license.
Cross reference that with social media, LinkedIn, etc to sniff out any red flags.
A trustworthy seller has nothing to hide.
I hope this information helps you differentiate from scam listing to legitimate listing.
Happy hacking!