Paying a private seller without getting burned
Most private-sale advice is written for sellers. This page is for the person holding the money, which is the person with the most to lose if the paperwork turns out to be wrong.
A seller who is paid badly has lost money. A buyer who pays badly can lose the money and end up with a car they cannot register, or one that turns out to belong to a lender or to someone else entirely. The pairs below cover the places that happens, in roughly the order you meet them. The left column is the habit to keep, the right is the move that tends to go wrong.
Titling, registration, tax and inspection rules differ by state, so wherever a pair touches paperwork, your state's motor vehicle agency has the final word.
Who is selling
Only the person named on the title can sign it over. Anyone else is asking you to trust a promise about someone who is not there.
Which car it is
A mismatch can mean a clerical error, a replaced part, or a stolen car. You cannot tell which from the driveway, so treat it as a stop.
Money still owed
If a loan exists, the lender is paid first and releases the title. The best version is closing the deal at the lender's own branch; the rest is covered in selling a car you still owe on, written from the seller's side.
History
A report you ordered cannot have been edited. Look for salvage or flood brands, odometer oddities and open safety recalls; recalls can be checked for free at nhtsa.gov.
Condition
An inspection usually costs far less than the problem it finds. A seller who refuses one has answered a question you did not need to ask. Deposits for unseen cars are a common listing scam.
The test drive
Some problems only show in the first minutes after starting or above a certain speed. A warm engine and a short loop can hide both, whether or not anyone meant them to.
How you pay
Payments that cannot be reversed or traced suit only one party, and it is not the buyer. The seller's version of this question is in getting paid safely when you sell privately; the safe options look much the same from either side.
Where you meet
Cash is the one payment the seller is sure to like and the one you cannot get back. If you must use it, withdraw it at the bank where you meet.
The price on paper
Understating the price is misrepresenting a sale to the state, and some states assess tax on a book value anyway. It also leaves you with no proof of what you paid if something goes wrong later.
Driving it home
Whether plates stay with the car or the seller, and whether temporary tags exist, depends on your state. Call your insurer and your motor vehicle agency before the sale, not from the curb.
After the handshake
Many states set a window for transferring ownership, and late transfers can carry penalties. Budget for sales or use tax and fees at the counter; our note on registration, title and the other state fees explains what to look up.
The deal itself
Deployed owners, estates that must close this week, cars "already with the shipper": the details change, the structure does not. A price that seems too low is usually the bait.
Notice that almost every "do" on this page is slower than its "don't". That is not an accident. The honest version of a private sale takes an extra afternoon, a trip to a bank and a phone call or two, and every shortcut offered to save you that time is worth examining for who it actually saves. A genuine seller loses nothing by waiting for a bank to open or a mechanic to look underneath. The only people who lose by it are the ones who were counting on you not to.
Keep reading
Further reading
- How to spot fake check scams Federal Trade Commission
- National Motor Vehicle Title Information System U.S. Department of Justice
- Appraise your car Edmunds