Steps to Protect yourself when Selling a Car

Last revision: Last revision:October 29th, 2020
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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.

Final takeaways

1. Let someone know that you've decided to sell your car publicly.

2. Keep your friends or family informed when you start talking to buyers.

3. Let them know if you decide on a meeting.


Don't give personal information to potential buyers

Another way to protect yourself while selling a car is to ensure that you don't give any personal information 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 Google Voice, 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.

Final takeaways

1. Don't use your own phone number.

2. Don't use your personal email.

3. Try to use a nickname if you can, at first.


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.

Final takeaways

1. Ask the potential buyer their full name.

2. Discuss how they plan to pay.

3. Use additional screening questions as you see fit.


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 breaks 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 complete truth at this stage will help you avoid any liability down the road.

Final takeaways

1. Always be honest about the state of the vehicle.

2. Let the buyer know if anything is wrong.

3. Answer any questions the buyer has honestly.


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 parking lot of busy stores, like Walmart or other large stores, or at a busy mall (generally, malls have big parking lots that make it easy to meet potential buyers while still having a flow of traffic and foot traffic around you).

Don't let the buyer know where you live or offer to meet them at their home. Also, don't ever 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.

Final takeaways

1. Decide on a highly public location for the initial meeting.

2. Don't drive the potential buyer anywhere.

3. If the buyer doesn't agree to the public spot, don't meet with them.


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.

Final takeaways

1. See if any friends or family members are free to accompany you to the meeting.

2. Let the buyer know you won't be alone.

3. Link up with your friend or family member before meeting the 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 directly call your insurance provider, explain the situation, and ask if you are covered.

Assuming you are covered, before you allow the potential buyer into the vehicle, get a copy of their driver's license. This can be as simple as taking a photo of the front and back of the driver's license 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 cell phone with you.

Final takeaways

1. Make sure the buyer is covered under your insurance for the test drive and get their ID.

2. Have a pre-planned route.

3. Keep your phone with you at all times.


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 checks, as you never know if those will go through. One good method to accept is a bank or cashier's check - 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, perhaps checking in with the Better Business Bureau, 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.

Final takeaways

1. Don't accept personal checks.

2. Research vehicle escrow services.

3. Use a trustworthy service you and the buyer agree on.


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 compartment, to make sure none of your personal records are still in the car.

If you hand over the service records for the vehicle to the buyer (which is very common in private sales), make sure all of your personal information is blocked out. There shouldn't be addresses, credit card information, phone numbers or any other personal information on the records. The best thing to do is to make copies of the records and then take a thick black marker to this information to block it out.

Final takeaways

1. Clean out the vehicle.

2. Remove everything from the glove compartment.

3. Blackout personal information from the service records.


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 completely done, with your name off anything remotely related to the car, including insurance.

This may mean you need to take some extra time to meet the buyer at the Department of Motor Vehicles (DMV) to complete the paperwork, but it is worth it. Your state may also have additional requirements, which you should check with the DMV while you are there or beforehand.

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

Final takeaways

1. Accompany the buyer to the DMV.

2. Make sure all the paperwork is properly done.

3. Cancel your insurance for the vehicle.

Final takeaways

Although it can be nervewracking 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:

1. Stay as safe as possible whenever meeting with potential buyers.

2. Make sure none of your personal information is given away.

3. Protect yourself from liability by keeping a strong paper trail.


About the Author: Anjali Nowakowski is a Legal Templates Programmer at Wonder.Legal and is based in the U.S.A.


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