Look Out for Used Car Scams

Unscrupulous used car dealers and sellers have come up with countless ways to rip you off. Some common scams to look out for include:

• Odometer rollbacks. The most common type of odometer fraud involves tampering with an odometer so that its reading is less than the car's actual mileage.
• Salvage fraud. A car is "salvaged" if an insurance company declares it a total loss because of a collision, flood, fire, or other serious physical accident. Many unscrupulous dealers buy these cars cheap at auction, patch them up, and sell them to unsuspecting customers. If the car's salvage history is disclosed and you are still interested, you should certainly have it professionally inspected.
• Repair fraud. Unscrupulous repair shops have been known to assemble the parts of several wrecked cars into one car. In one infamous California case, the driver's seatbelt anchors were attached to different halves of two wrecked cars that had been welded together. In another, there was no floor under the rear carpet. If anything about the car doesn't look right, have it checked out by an expert.
• Lemon laundering. This occurs when a manufacturer buys back a lemon from a consumer, then passes that car to another consumer without disclosing its lemon history.

• The seller doesn't own the car. If you're buying a car from a private party (as opposed to a car dealer), make sure the person selling the car actually holds title. Ask to see the seller's driver's license (or other photo ID) and the title certificate for the car. (But sometimes even honest people lose the title document and have to order another.)
• Financing scams. Many used car scams occur in the financing phase. Take all finance and loan documents home before you sign them. Read them there, without pushy salespeople breathing down your neck. Better yet, get someone else to look at them too.