How to Sell your Car?

Last revision: Last revision:9th March 2022
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Many people that decide to sell their vehicle focus on one thing: the asking price! Often, vehicles are sold so that we can buy new ones or to make a little extra cash on a car that is no longer being used. Although the asking price is really important, it's not the most important thing. Before even thinking about the asking price of a car, it's best to think about all the ways to keep yourself safe during the sale.

Although it would be nice to feel like the car selling process is always safe and easy, the truth is, there are important measures that should be taken to really ensure the safety of both the seller and the buyer. In any situation where personal information is being shared, risk is something to be considered.

In this guide, we'll go over the most important steps to protect yourself when selling a car privately. Please keep in mind this guide does not constitute legal advice and instead should be taken as informational only.

Read on for the most significant ways to protect yourself while selling your vehicle.

Keep a friend or family member informed of the process

The very first thing you can do to protect yourself when beginning the process of selling your car is to keep a friend or family member (or multiple friends and family members) informed every step of the way. Perhaps you have a spouse or best friend who you can talk to during the entire process from start to finish, just to let them know what's happening.

If you are accepting calls from potential buyers, putting out your phone number on advertisements, and even meeting potential buyers (more on this below), keeping someone close to you apprised of what's going on is a great way to ensure your safety. You never want to start dealing with strangers completely on your own. Having someone to be there along the way can ensure that you feel a little safer and that your friend or family member feels comfortable knowing they are aware of what's going on.

Avoid giving personal information to potential buyers

Another way to protect yourself while selling a car is to be careful with what personal information you give away to potential buyers. If you have posted an ad for sale on billboards or websites, or even if you have just advertised the sale through word of mouth with friends and family, it's important not to give away any information besides the bare minimum when screening potential buyers.

If possible, set up an online phone number to use, such as through a service like Skype, instead of giving away your own. It's also a good idea to set up a special email just for the sale, instead of using your own personal email. While communicating with potential buyers, you can use a made-up name or a nickname. When the sale looks as though it is near completion, you will need to use your real name on the documents, but until then, protect yourself by limiting the personal information you put out.

It's likely that many people will call who are not serious buyers, which is why it's always a good idea to screen people thoroughly on the phone before offering to meet up.

Identity theft is a legitimate risk in the online environment and talented scammers can often find a lot of information about us if they try. For example, if we publish our full name, email address and phone number with the car ad, a scammer might be able to use this information to start finding more of our personal information. They might find our mother's maiden name through our Facebook profile, and our date of birth from an archived newspaper that's available online. Eventually they might start using this information to call our bank or telephone provider and pose as us, trying to get a password reset. Therefore, as a general rule, it is best to limit what information we share online.

Screen potential buyers thoroughly

To avoid having your time wasted (at best) and getting safety or putting your safety at risk (at worst), take time to thoroughly screen your potential buyers. This includes asking things like their full name, how they plan to pay for the vehicle, and getting a general overview of the person on the phone before you decide to meet them.

As mentioned above, you will have a lot of people calling who aren't serious about buying your car, and some of them, in the worst-case scenario, may be dangerous or trying to scam you. Screening potential buyers thoroughly ensures that you can make decisions based on the information you have, and many times, based on your own human intuition, before you meet anyone in person.

Be a trustworthy seller

Although it may seem as though it's not related, one big way to protect yourself while selling a car is to be a trustworthy seller yourself! In other words, be honest and upfront about everything related to the vehicle during the sale process.

It may sound obvious, but never lie to potential buyers about the state of the vehicle. Not only is this illegal in most places, but it's a fast way to make your buyer very angry. It's a good idea to be as clear and upfront about the car, including everything from how the brakes work to any small noises you noticed coming from the engine. Be honest about when and how often the vehicle has been serviced and if there have been any recent points of concern.

Telling the truth at this stage will help you avoid liability down the road.

Meet potential buyers in a public place

Although this one may go without saying, never meet potential buyers at your home or their home. Always set up your meetings in a public place, whether this is the first meeting for the buyer to view and test drive the car or the final meeting to close the sale.

We'll discuss more on the test drive below, but good ideas to meet a potential buyer for the first time include in the car park of shopping centres or supermarkets.

Don't let the buyer know where you live or offer to meet them at their home. Also, don't agree to pick up the buyer or drop them off at another location. It is their responsibility to get to the meeting spot and their responsibility to leave. Although this may sound harsh, it's critical to keep you as safe as possible.

Bring a friend or family member with you to meet potential buyers

Along with meeting the potential buyers in a public place, it's a great idea to bring a friend or family member with you (or maybe multiple friends or family members). Knowing that you won't be meeting a buyer alone increases the safety of the transaction a lot.

Before you meet the buyer, make sure you let them know you will be bringing someone with you to the meeting. This will also deter buyers who may have bad motives (unfortunately, it happens).

You can have your friend or family member drive with you to the meeting spot or drive separately, just make sure you meet them before you link up with the potential buyer.

Stay safe during the test drive

If you are meeting in a public place and have a friend or family member with you, you're already in a good, safe place for the test drive. However, there are more steps you can take to ensure you stay as safe as possible. First, make sure your insurance covers another driver doing the test drive on your car. The best way to do this is to check your insurance policy. You can also directly call your insurance provider, explain the situation, and ask if you are covered, but even if they confirm that you are covered, it is a good idea to ask them which clause of the insurance policy covers this so you can check it.

Assuming you are covered, before you allow the potential buyer into the vehicle, get a copy of their driver's licence. This can be as simple as taking a photo of the front and back of the driver's licence on your phone. You may wish to request to view a secondary form of identification to confirm the person is who they say they are.

Have the friend or family member that you brought with you stay back while you ride along on the test drive. Have a route agreed on beforehand - don't just allow the potential buyer to drive anywhere they want. Make sure they know the potential route and that your friend or family member also knows the route and how long it will take. Let the potential buyer know you will only be on the route for 10-15 minutes. Have a plan with your friend or family member if you don't come back in that time and always carry your fully charged mobile phone with you.

Use financial safety precautions when completing the sale

For the buyer, handing their money over to someone and hoping to receive a working car can be stressful. But also for you, as the seller, it's very stressful trying to navigate the financial waters of a vehicle sale.

First, decide on what methods of payment you will accept. It's a good idea not to accept personal cheques, as you never know if those will go through. Some good methods to accept are an electronic funds transfer or a bank cheque - this way you know the buyer has the funds.

You and the buyer may wish to use a vehicle escrow account - but if you do so, make sure it is safe! Some scammers have been known to set up fraudulent vehicle escrow accounts to steal funds. Avoid this by doing a lot of research on the company, and maybe even directly calling the company.

It's best to think about ways to ensure both you and your buyer stay safe throughout the closing of the sale.

Remove personal information from the vehicle and from documents being handed to the buyer

Before you hand the vehicle or any documents over to the buyer, be sure none of your personal information is present. For example, one good first step is to clean out the entire vehicle, including cleaning out the glove box, to make sure none of your personal records are still in the car.

Keep paper trail to avoid liability

Finally, to avoid any liability for yourself, make sure you keep a paper trail of the entire sale from start to finish - with the most important part being at the end, when the sale is complete. Always make sure that all of the transfer paperwork is completed properly.

You may use a Vehicle Sale Agreement to set out the terms of the sale - such as the price, payment methods, date of sale, and whether the sale is subject to an inspection.

When you receive the money from the buyer and hand over the car keys, you may also use a Bill of Sale to confirm that ownership is being transferred.

It is also a good idea to provide the buyer with a General Receipt once you receive their money, to provide further evidence that they have paid for the car and it is now their responsibility and liability.

In addition, your State or Territory Motor Registry will have its own paperwork and formalities that you need to comply with in order to complete the sale.

Remember: all of the time and energy going into completing the transfer of ownership will be really important to ensure that you are clear of liability for anything that may happen with the new owner of the vehicle in the future.

In conclusion

Although it can be nerve wracking to think about selling your car privately, the truth is, many times it's a lucrative way to go about getting rid of a vehicle. But it's important to stay safe and protected. By following the steps in this guide, you'll ensure a smooth, efficient selling process for yourself, as well as a safe buying process for your buyer:

Templates and examples to download in Word and PDF formats

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