New Reasons To Be Careful When Buying a Used Car

If you’re buying a used car like most people do, you’ve got to be aware of some danger spots so you don’t end up with a stinker of a ride.

Beware of these dangers when buying used

I’ve talked in the past about how we have a scandal in this country where auto insurers will look the other way after a big flood and sell flood vehicles to people who wash the title. Those people then resell the cars as if they’ve never been in a flood in the first place.

Unwitting buyers wouldn’t get taken by this ploy if they’d just run a vehicle VIN through the National Motor Vehicle Title Information System (NMVTIS). Of course, fewer buyers ever do that.

So California has come up with a law I love. They’re requiring dealers to first run the VIN of any used car they want to sell through the NMVTIS before putting it on the lot. This check reveals not only flood cars, but cars that have been totaled, salvaged, or Lemon Law-ed out by the insurance industry.

A car that gets flagged by the NMVTIS will have a big red sticker of shame on it when you see it on the dealer lot in the Golden State. What a brilliant, simple system to warn people away from these stinkers.

I would love to see a similar requirement on dealers in all states, but they have among the most powerful lobbyists in most state legislatures and that will probably never happen.

The sad reality is that a used car seller — whether a dealership or a private individual — is legally allowed to lie to you about a car in most states. So don’t take their word about a vehicle.

Instead, what you have to do is run a vehicle check like CarFax and have an inspection of the car by an independent diagnostic mechanic of your choice as a condition of the sale. If a used car dealer says ‘no’ to that last request, you know they’re hiding something.

Salvaged used car warning

The latest danger we’re seeing now is that some shady car dealers are exploiting a loophole in the lagtime of vehicle title history reports.

Here’s how this one plays out: You go to buy a used car and the salesperson says, ‘This car is fantastic, and we can prove it to you. Here’s the vehicle title history report (aka Carfax) and it shows no problems.’

But the dealer knows the truth: They bought it as a salvage car that had been in a terrible accident and stitched it back together. Then they pass it off as a perfect condition car.

There is a loophole that lets them lie to you because there’s a lag time with the title history, between what the history shows and what may really be going on with a car.

I want to emphasize it’s not every dealer doing this. But some shady ones are. Be careful out there. The reality is checking a Carfax is just one part of the steps to make sure you’re getting a good used car. The real key is always have it checked out by a mechanic, as I mentioned above.