I have been in the automotive business since 1992 and I have seen many scams. For the safety and convenience of my valued customers I have listed some of the more popular scams and things to BEWARE of. When you’re shopping for a vehicle from a private individual have you ever encountered any of the following:
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- Illegal auto dealers – Curbers / Curbstoners / Gypsies?
- Vehicle history reports
- Salvaged titles
- Hidden liens
- They won’t meet you at their home, or they are selling the vehicle for someone else
1. Illegal Auto Dealers
“Curbstoners” – This is the individual who has no license, no bond and no insurance to be in the automotive business. Here is what to look for:
When you call on an advertisement ask if their “CAR” or “VEHICLE” is still for sale – if they say “which car” it is probably a sign that they are a dealer, which is o.k. if they are honest and tell you that. Most “Curbstoners” will lie to you and say that they are selling the car for their sister, their uncle, their neighbor, etc. 9 out of every 10 times the odds are they are buying and selling cars illegally. The reason they lie to you is because they know what they are doing is illegal and could land them in jail. Yes, it is a criminal offense to buy and sell more than 6 cars per year without a license in the state of Arizona. Most of these individuals are trying to sell in excess of 100 per year! They also lie because they are doing what is called “Jumping titles”. If they sell you the car and you question them why the title is not in their name they simply tell you “remember, I said I was selling it for my sister and brother in-law. That is my sisters married name and that’s why it does not match my name”..
By the way “jumping titles” is also very illegal and dangerous to you as the consumer – What if there is a “Hidden lien” on the title? What if the title the individual gave you is not the “current title” (there could be a duplicate out there)? When you purchase a vehicle from an individual make sure the name on the title matches the name of the person selling it to you! A LICENSED, BONDED AND INSURED AUTO DEALER HAS TO LEGALLY GUARANTEE YOU A LIEN FREE AND CLEAR TITLE!
HERE IS AN ARTICLE THAT I JUST RECEIVED FROM THE ARIZONA INDEPENDENT AUTO DEALERS ASSOCIATION.
Top Curbstoners Run Out of Az by the OIG
In a joint effort with Federal authorities, Tom Brice of the Office of the Inspector General (OIG) was able to stop 35 of the top curbstoning offenders this month.
Our frustration with the ever increasing curbstoner issue has worsened as economic & inventory issues increase. What a breath of fresh air when I heard of the Curbstoner case; and it gets even BETTER when you know the details.
35 top volume Curbers shut off!!
Just 1 of the 35 dealers @ 1 auction purchased 1.4 MIL within the 14 months investigated; and of those vehicles, the vast majority were curbed.
But wait, there’s more: of the vehicle list of all of the top offenders, 50% also had ODOMETER ROLLBACKS that averaged 90,000 miles per vehicle.
Tom Brice said in an interview regarding the case,
“We acted on this case, not only for criminal enforcement; we also know that Arizona Dealers are unfairly having to compete with these curbers, who have less overhead & business liability.”
AIADA would like to thank Tom Brice and the Office of the Inspector General for their diligence and hard work.
HERE IS ANOTHER HEADLINE THAT JUST CAME IN.
ADOT detectives make undercover bust of unlicensed auto dealer
Suspect faces minimum fine of $118,000 for illegally selling more than 100 vehicles
August 16, 2016
PHOENIX - An undercover bust of a man accused of selling more than 100 vehicles without a dealer license is a reminder for buyers to be wary and do their homework.
Detectives with the Arizona Department of Transportation cited Daniel Miranda, 35, of Avondale after arranging for a detective to buy a vehicle advertised for sale. Their investigation revealed that Miranda had sold 124 vehicles in the last 11 months without a license. This is known as curbstoning. State law allows an individual to sell no more than six vehicles in 12 consecutive months without a dealer's license.
In addition to a citation for acting as a used vehicle dealer without a license, Miranda was cited for not having a business license. The penalty for selling more vehicles than allowed by an individual is between $1,000 and $3,000 per vehicle, so Miranda faces a minimum $118,000 in fines.
"Our detectives are very proactive when it comes to finding unlicensed dealers, protecting vehicle buyers and ensuring that vehicles are sold legally," said Michael Lockhart, chief of ADOT's Office of Inspector General.
After citing Miranda, ADOT detectives requested a hearing at the ADOT Executive Hearing Office to establish a penalty. Miranda will also face a court hearing since the citations are criminal charges.
ADOT urges those looking to purchase used vehicles to be diligent and ask lots of questions. Also consider completing the transaction at a Motor Vehicle Division office or Authorized Third Party business, where employees can check the vehicle title for liens and confirm the vehicle identification number.
ADOT's Office of the Inspector General investigates fraud involving driver license and identification card applications; vehicle sales by licensed and unlicensed dealers; and vehicle titles and registration. It also assists state, local and federal law enforcement agencies with investigations.
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2. Vehicle History Report
Make sure you run a “Vehicle History Report” on the vehicle you are interested in purchasing. This report is “mostly” accurate. It will tell you most all title histories. It will not tell you “all” accident history – An accident is only reported when there is a police report generated – other words if a vehicle was damaged (no matter how bad it was) (insurance companies DO NOT report to these companies) and there was never a police report it will not tell you.
A common practice with “shady” curbstoners is getting a vehicle history report from another vehicle and placing it in their vehicle. I get calls all the time asking for VIN numbers so they can “run a vehicle history report”, but what are they really doing with it? Make sure you check the VIN number on the report with the one that is actually on the vehicle you are looking at! Use your common sense when looking at a previously owned vehicle or have it inspected by a business that is certified.
These reports will also tell you if the person selling the car is being honest. However, DO NOT rely just on the vehicle history report to make your decision on the purchase – there are many cars out there that have had an oops or two and are still great cars – just use that warm fuzzy feeling! Here are two places to go to run a “Vehicle History Report”.
1. autocheck.com($59.95 for unlimited reports for 30 days) – Has very aggressive accident research, show's auction announced "frame damage" - Carfax does not show and/or list frame damage that is announced at auctions.
2. carfax.com ($59.95 for 5 reports/unlimited "license plate" searches) – Most advertised/popular but more expensive. Is very aggressive on "service history" of the vehicle (service records).
Auto Paradise of Arizona is a Carfax advantage dealer. We provide a FREE Carfax report on every vehicle we sell. We also use Autocheck on most vehicles - our goal is to provide our customer with complete transparency!
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3. BOX "C" TITLES - "NOT ACTUAL MILEAGE"
If you purchase a vehicle and the letter "C" appears on the right hand side of the title, next to the mileage you know that the vehicle in question has been bought/sold at least once with an odometer rollback. How do you really know what the “true” mileage is? There are some things that will help:
1. Look at the brake pedal pad. Does it show more wear than what is “common” for a vehicle with the miles advertised
2. Look at the driver’s seat. Does it show more wear than what is “common” for a vehicle with the miles advertised
3. Most Vehicle History Reports will give you a mileage reading EVERYTIME the car is inspected every other year. Also, many times the vehicle history report will show "service" history from automotive repair shops and they will log in the mileage at the time of service.
Remember, a licensed bonded dealer is required by law to disclose ANY mileage discrepancies to you!!!!
Remember there is more to buying a car than just the price – Most great deals that seems too good to be true, usually are!
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4. Salvaged Titles
Here is the one that I know you have all run into – more than once I’m sure: “SALVAGED TITLES”
Where do we start with this one?
A salvaged title is a vehicle that has been involved in a serious accident and the insurance company believes that it would be cheaper to “total” the vehicle, than to repair it to meet industry standards. When someone advertises the car has a salvaged/reconditioned title and tell you it was the bumper, fender and it was minor…. THEY ARE NOT BEING TRUTHFUL! 99% of the time it was a MAJOR accident!!
Here is how the process works:
Once a vehicle has been in an accident, an adjuster from the insurance company goes over the vehicle. After this occurs usually two things happen:
1. The vehicle is given back to the insurance company and then sold at a “salvaged auction”. Only people licensed to buy/sell salvaged titled vehicles can buy from these auctions. The car is then either parted out or fixed.
2. The vehicle is given back to the “owner” and a check is given to the insured, less the amount agreed upon for letting the insured keep the vehicle
For example, a settlement of $7,000 would be given to the insured driver if they “give” the car to the insurance company, or they get $5000 and get to keep the vehicle, either way the vehicle is now considered “salvaged”
3. A salvaged or reconditioned title mean the same thing. The title will be branded on the right hand side for those titled in the state of Arizona.
So why to NOT buy a salvaged titled vehicle.
1. How do you know it was put back together properly? Were CAPA/OEM parts used? Were the air bags deployed, and if so are you sure they will work again? Do they have receipts for the work done? Do they have pictures of the damage?
2. 99% of ALL banks will NOT loan on a salvaged titled vehicle
3. Almost ALL insurance companies will not give "full coverage" on a salvaged titled vehicle, and many won’t insure it at all, or your rates will be higher.
4. The resale value of your car diminishes greatly. A “rule of thumb” when buying a salvaged titled vehicle is to look at KBB or NADA and look at the “FAIR” condition price then subtract 50% from that value..
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5. Hidden Liens on Titles
When you go to look at a car from a private seller you do not know what their financial situation is. What if they are selling a car because they need money to pay bills? What if they are getting ready to lose their house to foreclosure? You have to keep in mind that people who are in a desperate situation may have judgments against them and have any property they own “Liened” – Meaning the car you just bought (that you thought you got a great deal on) may have a hidden lien on it and ”YOU” will now have to pay it off in order to get a clear title. What are you going to do? Sue them for what it cost you to get a clear title? People in this situation will just tell you to stand in line with all the other people they owe money to! BE CAREFUL OUT THERE!
In today’s “economic” times, many creditors have gone to great lengths to collect their money. A common practice is to place a lien on any vehicle owned by the person who owes them money. This lien will not show up on the title, but when you go to transfer the title into your name, it will show up then.
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6. Won’t meet you at their home / they are selling the vehicle for someone else
Anytime someone sells something, especially a product worth thousands of dollars, they should be willing to meet you at their home. Now, granted with some things that have occurred I understand people are leery, but if you are asked to meet them in a parking lot be very “skeptical”. Most of the time, the person selling the vehicle, has something to hide. They do not want you to know where they live because they are doing something “shady”!
The first thing you should ask for when buying a vehicle from a “private party” is identification and the title! If someone tells you they are selling the vehicle for their mother, sister, brother or whoever, most of the time they are not being truthful. If, on the rare occasion, it is the case, I would get the telephone number and address of the person ON THE TITLE, in case there are any problems transferring the title! I would call them before giving ANY money for the vehicle.