Scam alert for car buyers

Make sure your next purchase is a good buy and not a goodbye to your hardearned money. AA and Driven offer tips on how to avoid being scammed.

Buying and selling cars online is an incredibly useful modern convenience, but it’s also become a feeding ground for scammers. The old saying goes, if a deal looks too good to be true, it probably is.

The good news is that with a few precautions you can avoid falling into a scammer’s trap:

When selling

Be cautious of unconventional payment methods

Scams targeting online car auctions appear often. In these situations the scammer is typically overseas or out of town and wants to buy your car for a family member.

Initially, the buyer will contact you and offer to buy the car for the exact asking price on the website, no questions asked.

They’ll ask if they can pay you using some sort of online payment system such as PayPal or Western Union — online methods that are hard to trace and often international.

You will then receive a fraudulent email saying payment for the vehicle has been processed, along with a request for extra money to cover transporting costs to a (fake) address.

The buyer may appear to be in a rush to pressure you, the seller, into paying these fake shipping costs, to mask the fact their payment for the car has not been forthcoming.

When buying: Always check for outstanding finance

A simple scam is selling a car with outstanding finance. In New Zealand, the finance stays with the car and not with its owner, so if you buy a vehicle with undisclosed finance owing on it, you’ll get more than you bargained for.

If a vehicle is listed with a bargain price, it’s often to lure a buyer into a quick, rushed sale. The seller may even explain they’re moving overseas to justify the urgency — which, admittedly can sometimes legitimate.

Typically for a scam, the car is sound and few details are exchanged, and it’s not until months after the sale when the buyer has vanished, that a repossession firm shows and notifies that there is finance owing.

The NZ Government’s “Buying a Used Car” page offers a service to check for a $9 fee.

Another online scam is when a seller poses as a dealer; usually the vehicle is listed with an extremely low price, with the conditions of payment upfront and vehicle delivery. If not satisfied, you can cancel the contract and return the vehicle. However, once payment is processed, the vehicle never turns up and the fake seller/dealer disappears.

Look for clues in the photos, too. Do they look genuine? Is the vehicle left-hand drive when it shouldn’t be? Is there a good selection of photos? If it looks suspicious, ask for a specific photo of something that a scammer couldn’t supply, but a genuine seller could.

When selling: Look out for trade offers

Trade offers can be legitimate, but sometimes sellers will propose a trade offer with a car of greater value than your own car being sold.

Again, this is to lure you into a quick trade without doing the appropriate finance checks beforehand, or to even get you to transfer the difference back to the buyer.

How to avoid being scammed

Always check the buyer or seller’s details, and never buy a car without viewing it and/or the seller. Never physically hand over a sold car until the money appears. Avoid or at least be sceptical about overseas buyers/ sellers and unconventional payment methods and urgency or pressure from the buyer or seller.

Avoid rushing into anything. These things should take time. A legitimate buyer/seller will understand this. Research the vehicle’s value; verify the seller/ buyer’s personal information; schedule an AA-style of inspection; and check for monies owed. And avoid emailing personal info or credit card details. A little homework and caution could be the difference between a good buy and a good bye to a load of money.

If you have concerns about a for sale listing on Driven.co.nz, contact support@driven.co.nz or call 0800 735 455.