Interview the Seller Before You See the Car
A thorough phone interview may help you identify possible scams and save you the time and effort of arranging a meeting and/or test drive.
Confirm the Seller's Identity
Make sure you have complete contact information for the seller, and not just a mobile phone number or an email address. Independently confirm the name, address, and home phone and work phone numbers of the seller by consulting a phone book, directory assistance or an online database.
Have a Mechanic Inspect the Car
This is a good idea when purchasing any used car, but particularly so when purchasing from a private seller with whom you may have little or no recourse if something goes wrong after the transaction.
Know the Car's Relative Worth
If the car's asking price is well below market value, find out why. Most sellers aren't trying to unload a $10,000 car for $1,000 unless something is amiss.
Research the Car's History
Vehicle history reports are easy to obtain and well worth the investment. History reports can be purchased via websites such as carfax.com or autocheck.com for about $20. The reports will identify cars that have been stolen, involved in major accidents or had other noteworthy problems.
Check Out the Title
When you have the car in front of you, ask to see the title; compare the vehicle identification number on the title to the one on the car to be sure they're the same. You want to be sure the seller really owns the car. If the name on the title differs from the name of the seller, start asking questions.
Beware of Odd Payment Scenarios
If everything checks out and you're ready to buy, don't let your guard down. Obviously, never provide a stranger with your credit card or social security number, and be suspicious if the seller suggests a convoluted payment plan (for example, he/she asks you to write a check to another individual at a different address). If you use an online escrow service, make sure it is reputable by checking Escrow.com (which provides tips for spotting fraudulent services) or by contacting the Better Business Bureau.
Write It Down
Whether you're buying or selling, request a receipt that includes all the pertinent information, including transferred warranty coverage versus "as is" condition, purchase price, odometer readings, detailed seller contact information and a signature.