You can save money by buying a used car, but if you become a
victim of any of these used car scams and cheats it could wind up
costing you thousands. Learn the tricks that dishonest used car con
men use to cheat innocent people out of their hard earned money.
Biggest used car scams.
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Title Washing -- Rebuilding salvaged cars
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Selling Lemon Law Buybacks -- Without disclosing it was a lemon
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Not Disclosing Previous Damage
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Odometer Fraud -- Rolling back mileage
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Selling Flooded Vehicles -- Without disclosing flood damage
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Book Value Scam
Title washing fraud. When a car is so severely damaged in
an accident that it can not be repaired, or the cost to fix it is
too high, an insurance company will declare the vehicle a total
loss. A salvage title is issued, and the damaged car is sold for
parts. However, many states allow salvage cars to be rebuilt and put
back on the road. An auto re-builder will repair the car, often with
parts from another salvage car, and then obtain a new, "clean" title
for the car.
But the title is not really clean; the vehicle will always have a
salvage history. Avoid salvage cars at al costs. The value of a car
that has had it's title washed will be less than half. Safety is a
major issue, too. How safe do you think a car is if it is really two
halves that have been pieced together?
Lemon buybacks. Some new cars are just problems. When a
car has problems that can't be repaired within a specified time or
number of attempts the auto manufacturer can be forced to buy it
back under state lemon laws. What constitutes a lemon car is defined
by state laws, and varies by state, but in all cases a lemon car is
one that has had problems.
Lemon cars should be destroyed, but carmakers take another
attempt at repairing the problem, and then sell the car to a local
dealer for resale. The manufacturers disclose the lemon history to
the dealers. Dealers are supposed to disclose lemon law buybacks
to consumers, but unethical dealers will never mention the fact
that the car is a lemon, or they will bury the disclosure in the
fine print of a pile of paperwork. When dealers buy lemons they pay
a lot less. You could wind up paying thousands too much for a lemon
car, and still have a car with serious problems.
Failure To Disclose Damage. Cars are wrecked and repaired every
day. There are millions of cars on the road today that have been
damaged to some extent. The courts have found that if a dealer knows
of previous damage, or should have known, then that fact must be
disclosed to a potential buyer. Car dealers are experts, and they
usually know when a car has been wrecked. Watch out for dealers who
try to hide the facts from you. Protect yourself by having a
mechanic inspect the car on a lift, and be sure to check the vehicle
history at CARFAX. If a car was in a minor accident that was not
reported to the police then CARFAX will show no record, but it will
show DMV reported accidents.
Odometer Rollbacks. Most cars today have digital odometers which
are harder to roll back than the old wheel type odometer, but it can
be done. Changing a cars odometer today requires computer knowledge,
which is not lost on tech savvy crooks. By reprogramming or
replacing the cars ECU and odometer chip an odometer con can easily
make the car show whatever mileage he wants.
These guys buy cars with high mileage for below market prices,
clip the mileage, and sell them at inflated prices. If you buy a car
that had the mileage clipped not only will you pay too much, but
you'll spend more money on repairs due to worn out components. I've
seen a case where a Toyota Land Cruiser actually had over 110,000
documented miles, and a dishonest dealer had changed the odometer to
show only 30,000 miles. The mileage would have been a $7,000
deduction in value.
Flood Damaged Cars. Hurricanes Katrina and Rita damaged thousands
of cars in 2005. Most of them are now showing up on the used car
market. Dishonest used car dealers have been buying these cars,
cleaning them up, and reselling them to unsuspecting buyers. Even if
you do not live in an area affected by hurricanes or flooding you
could be scammed by an unethical dealer. Cars are easily shipped
to areas away from the flooding in order to catch unsuspecting
buyers off guard.
If you buy a car that has been submerged underwater you are going
to have problems. Electrical components are the first to go. An ECU,
the cars main computer, can cost $1,000. Electric motors that
operate everything from power windows to windshield wipers are $200
to $500 each. In a flood car carpeting and upholstery will mold,
mildew and slowly rot. Stay away from flood damaged cars.
Book Value Scam. A trick used by slick car salesmen who prey on
naive buyers. The salesman will quote a very high price to an
unsuspecting buyer, and then justify the price by showing the buyer
a Kelley Blue Book or N.A.D.A. Used Car Guide.
Book value will always be much higher than the salesman's price. Problem is the book
is at least 1 year old or more. Both Kelley Blue Book and N.A.D.A.
publish price books monthly. Some salespeople save the old books and
pull them out to show unsuspecting buyers. Always check the date on
any book. Cars depreciate over time, and a car that was worth
$12,000 last year may be worth only $9,000 today.
