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The 10 Worst Car Scams

The 10 Worst Car Scams

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1.) Cash 4 Clunkers

At first glance, the Cash 4 Clunkers program seemed like a harmless incentive to get more fuel efficient cars on the road. Indeed, it did help reduce pollution and boost the economy. But in reality, it created a shortage of used vehicles, increased used car prices, and harmed income earners.


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2.) Dealership Gap Insurance

If you’ve ever bought a new car, you’ve probably had a car dealer try to sell you gap insurance with your purchase. If you’re ever in an accident, this insurance would help cover the “gap” between the amount you owe on your car and the car’s actual cash value. Dealers tend to jack the price up for this kind of insurance so you’re better off getting it through an actual auto insurance company.


Shutterstock / Ollyy


3.) The Sob Story

When buying a used car from a site like Craigslist, scammers will try to pressure you into buying their car by making you feel sorry for them. They’ll say they just lost their job or they need money for their kids- anything to make you feel sympathetic and buy the car more quickly. The less time you think about the purchase, you’re more likely to not realize you’re being ripped off. So make sure you take you’re time deciding, and try not to let the sob stories get to you.


Shutterstock / William Potter


4.) Time Sensitive Schemes

Car salesmen try to use the time to their advantage when selling you a car. If they think you’re a tough customer, they might try to run out the clock and use your impatience to get you to become more agreeable. On the other hand, they might try to pressure you into buying something right away by bringing up a “really good sale” that just so happens to be ending that day. It’s a good idea to let the salesman know right away what you want the pace to be.


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5.) Rolling Back The Odometer

Bit of an old one, but people still try to roll back their odometer to make people think they’re buying a newer car.


Shutterstock / Ronald Sumners


6.) Curbstoning

If something does go wrong, you — and the authorities — will have a tough time tracking that curbstone seller down.

There is a limit on how many cars an individual can sell without being a licensed car salesman. Curbstone dealers are people who avoid getting licensed so they don’t have to guarantee a refund is the car is a lemon.


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7.) “Like New” Rebuilt Title Vehicles

“Like new” is an almost impossible condition for a restored car. Sure, it may look nice on the outside but it won’t do you much good in the long run.


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9.) Fake Money Order Scams

Sellers from sites like Craigslist will sometimes create very convincing fake money orders. This site had a good explanation of how scammers pull this off :

“Someone sells a car on eBay, Craigslist, whatever. Say the price is $10,000. The “buyer” sends them a very well-made fake money order for an amount higher than the purchase price. $12,000 or so. Their excuse is they had the money order drawn up already for a previous sale that fell through, they made an honest mistake, any number of excuses. They ask for the seller to refund the difference.

Because the money order looked so legit, the seller’s bank accepted it and put the funds in their account. The seller then sends the “buyer” their refund. Two weeks later the money order comes back as fake and the seller’s bank reverses the deposit and pulls the funds out of their account. Now the seller is out thousands of dollars. They’ll never get it back because these scammers use fake names and PO boxes and often aren’t even in the US, and almost never get caught.”


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10.) Auto Warranty Scams

The FCC has a whole page on how to protect yourself against warranty scam:

“If you own a vehicle and a phone, you may receive calls from scammers posing as representatives of a car dealer, manufacturer or insurer telling you that your auto warranty or insurance is about to expire. The call will include some sort of pitch for renewing your warranty or policy.

During the call – which often begins automated or pre-recorded – you may be instructed to press a certain number or stay on the line, then asked to provide personal information, which potentially can be used to defraud you.

What makes it particularly hard to discern if this type of call is fraudulent is that the scammer may have specific information about your particular car and warranty that they use to deceive you into thinking they are a legitimate caller.”


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8.) Dealership Service “Recommendations”

Dealership service can sometimes be a better option and they are usually very professional and quick. But they might try to stick you with some extra “recommended” service that you don’t actually need.