Most buyers are honest. A few are not, and they target people selling cars online. These are the scams to know, the payment rules that protect you, and how to meet a buyer safely.
The fake check scam
The Federal Trade Commission describes how it works: someone says they want your car, but they are not local and cannot see it in person. They send a check for more than the price and say it was a mistake, or that the extra is for a shipper, and ask you to send the difference back. The check looks real and the money may show in your account. Weeks later the bank discovers it is fake, takes the money back, and you are out the cash you sent (FTC alert).
Why a fake check can "clear"
Banks have to make deposited funds available quickly by law. The FTC warns that even if you see the funds in your account, that does not mean the check is good, and that fake checks can take weeks to be discovered (FTC: how to spot a fake check).
Payment rules that protect you
- Never accept a check for more than the price, and never send money back to a buyer. The FTC calls an overpayment request a sign of a scam.
- Do not hand over the keys or title until the money is really yours. Cash counted in front of you is the simplest. For a cashier's check, meet the buyer at their bank so the bank can issue it while you watch, or go to the issuing bank together and have it verified. Use a phone number you looked up yourself, not the one printed on the check.
- Check your own banking app. A screenshot or email showing "payment sent" proves nothing. Wait until the money shows in your account as available, or take cash.
- Be careful with payment apps. They are built for sending money to people you know, and some transfers are hard to reverse.
- The FTC suggests an escrow or online payment service as an option when you sell online.
Other red flags
- A buyer who offers to pay without seeing the car, or sends a deposit "to hold it"
- Asking you to pay a fee, buy gift cards or use a link to "verify" anything first
- Pressure to move fast, or a story about a shipper who will pick the car up
- A buyer who refuses to meet in person or show ID
- A message that moves you off the site or app where you posted the ad
Meeting safely
- Meet in a public, well-lit place, in daylight. A bank lot or a police station parking area is better than your driveway.
- Bring a friend, and tell someone where you are going.
- Do not let a stranger test drive alone. Go with them, and keep the keys until you are paid.
- Look at their driver license and write the name on your bill of sale.
- Take photos of the signed paperwork. Remove your plate.
If you think you have been scammed
- Call your bank right away and tell them what happened.
- Report it to the FTC at ReportFraud.ftc.gov.
- In North Carolina, the Attorney General's consumer hotline is 1-877-5-NO-SCAM (1-877-566-7226) or (919) 716-6000 (NC Department of Justice).
- File a police report with the photos, messages and details you have.
One way to skip most of this
Selling to a local car buyer takes most of these risks off the table, because the money changes hands in person at pickup. We are a local buyer in Greenville, and we pay cash or check when we take the car. Ask any buyer, including us, to explain exactly how and when you will be paid. Get a free offer.
Frequently asked questions
Sources
- FTC: Fake check scam targets online car sellers
- FTC: How to spot, avoid, and report fake check scams
- NC Department of Justice: Protecting Consumers