Who knew buying a used car would be so difficult?
You may have seen this story on TV news last month: A Virginia man was duped into buying a truck that had been used by U.S. Border Patrol agents.
Amid deceptions, scams, bad titles, rusty bottoms and outright lies, I have felt this man’s pain recently in trying to buy what the car biz calls a “cash car,” a cheap, used car that is too old to be financed.
The last straw was when I was on the verge of buying a snappy looking 2011 Honda Civic with about 87,000 miles on it for $5,000. I could not have drawn it up any better. My ideal scenario was to find a Civic at $5k or less. The car seemed to be in very good condition. For a vehicle that had 200 thousand miles of potential, 87,000 was not bad. I am not proud to admit I had the check written the night before our taking the vehicle to a mechanic for a pre-buy inspection.
My “off-brand” urgency shocked my wife, who thinks me overly analytical with emphasis on the first four letters in analytical. To rationalize my quick-moving to her I said, “I could flip this myself for $6,900 or $7,900 if I wanted to, OK?”
The only thing visibly wrong with the Civic was that the interior head liner was messed up, having come down at some point and been clumsily glued back up. But, that’s cosmetics, so who cares? Unless, it’s a sign the car has been under water or had a bad leak. It had been bought earlier this year in Florida – you know, where they have hurricanes and lots of water.
Except, concerns about the car having been flooded turned out to be unfounded. It was worse.
THE REBUILT TITLE
The Honda turned out to have a bad title – a “rebuilt” title -- even though the owner showed me a valid “used” car title issued by the state of Tennessee. It was still in the envelope mailed to him by Shelby County Clerk Wanda Halbert. I even took a photo of the title, which turned out to be a good move.
Insurance companies will not write collision or comprehensive coverage for a car with a rebuilt or “salvage” title – meaning a car that previously was totaled by an insurance company. Some insurance companies will write liability coverage only. Some won’t even do that. The car itself may run all right, but another problem arises when you seek to sell or trade it later.
More later about the perfect Honda that was not, but to keep you from repeating my mistakes, here are things I learned the hard way.
CAR FLIPPERS: A COTTAGE INDUSTRY
Those ads on the Internet aren’t just from individuals selling granny’s low-mileage, one-owner car. This is a whole cottage industry.
You’ve heard of “shade tree mechanics,” those who do mechanic work from home. Meet shade tree car flippers. I apply this term to individuals who buy cars, usually at auctions, and act shady about the car’s history when they quickly resell. Another term for a form of this is “curbstoning,” or selling cars from a parking lot or curbside with no contact information besides a “for sale” sign in the car window. The phone number in the window may not be that of the last registered owner. In the modern era, “curbstoning” has largely moved online.
In this category are individuals and small dealers, who have access to dealer auctions or salvage yards and get cars from various sources in order to re-sell at a profit. Some resellers fix small issues – buying a new battery or new tires is common – or slap on a cheap paint job to cover up blemishes. Others bring a car straight from the auction to a car lot and don’t even clean it out well.
Many of these run ads as individuals, such as on Craigslist, Facebook Marketplace or Autotrader.com, without stating any dealer affiliation. When pressed on this, some will say, “I buy and sell cars,” or “I’m a dealer.” There is nothing wrong with buying and trying to make a buck. But, here’s the rub: Many cars that come from auctions have those darn rebuilt titles, which some sellers will readily admit and some will not.
One question to flesh out flippers is, “How long have you owned the car?” A short time frame is a clue that it may have come from an auction and have a rebuilt title.
Another vital question is to ask for the Vehicle Identification Number (VIN). Screen the car with a free VIN check online, which may only confirm that it is the make, model and year the seller says it is. To dig into the title, get a vehicle history report such as from CarFax or AutoCheck. If a seller acts funny about getting that question, it’s buyer beware.
The mere act of setting a car out in a visible location with a for sale sign in the window is not itself illegal. As a valid owner, I sold a yellow 1973 Camaro once by letting a girl drive it to and from work and park it at Clark Tower in Memphis. That worked after my ads and other efforts had failed. (I digress here to recall that she threw the keys at me when I told her I had a buyer and she could no longer use the car.) The difficulty in leaving a car out in the same place for days is that the car could be reported as abandoned and removed, and a seller runs the risk of being towed if the property owner is not down with his or her space being used that way.
SHADE TREE CLASSIC
This recent adventure in used car buying reminded me that we had bought a Chevrolet pickup more than 20 years ago. The seller was a grandfatherly type we met as he whittled out in the yard under a large shade tree. The truck was white, but my wife kept saying, “This is a blue truck.” She turned out to be psychic on that, but meanwhile she bought the seller’s shtick.
“He said he owned a farm in Alabama. I bet he drove that truck down there to take his grandson fishing,” she imagined. “Ahhh.”
When we exchanged a check for the title, I was stunned to see that the truck was not being transferred by the little old man but rather “Acme Heat and Air Company.” It had been used hard for probably 200,000 miles or more before the company dumped the thing, which only had a five-figure odometer that rolled over every 100,000 miles. Before long, the white paint started flaking off – to reveal the factory blue.
TITLE SKIPPING
This shade tree seller had skipped the expense of registering the truck in his name. He held the title, which had been signed off by Acme Heat and Air, until somebody like me came along.
“When somebody comes into our office, we have no way of knowing that the titled owner is not the person that sold the car,” said Shelva Stafford, supervisor of the title department in the Shelby County Clerk’s office. “We take it at face value. It’s an open title.”
This practice also is known as “skipping the title,” re-selling without bothering to register the title and pay taxes and fees. A dealer can be assigned title to a car without having to register it, but an individual cannot. Further, state law says a person may sell five cars in a year’s time with no dealer’s license required. More than five, a seller must be licensed as a dealer.
In Tennessee state law, title-skipping by a non-dealer is the very definition of curbstoning:
"Curbstoning" means the selling, offering for sale, advertising for sale, or soliciting the sale of:
(A) Any motor vehicle without a properly endorsed certificate of title as required by § 55-3-127 by a person or entity engaged primarily in the sale of used motor vehicles if the person or entity is not licensed as a motor vehicle dealer under § 55-17-109;”
TCA 55-17-114 states that engaging in curbstoning is grounds for denial or revocation of a dealer’s license.
“Curb-stoning is an underground industry,” said Tennessee Motor Vehicle Commission customer service representative Shelby Rehberger. “They can sell without a license, without quality control or regulation. They will skip putting their name on the title to sell the car. It’s like they never existed in the transaction.
“The nature of the industry is mobile,” she said. “Except for a number painted on a windshield, a buyer may not have any way to contact the seller later.”
Under TCA 55-3-127, it is a class C misdemeanor for a title being transferred to omit the “buyer” or “transferee” information. Someone who is actually caught doing that could be required to pay fees and taxes based on a legitimate value assigned to the vehicle, plus a penalty equal to 25% of established value. However, it seems unlikely this would ever be prosecuted so long as the eventual buyer was able to register his or her title.
“Given the fact the government is not in a position to help you, and eBay is being run amok by scammers, the responsibility of not getting scammed falls squarely on the shoulders of the consumer.”
– FraudGuides.com
In the example of our buying the pickup, outside of feeling duped, there was no harm, and I registered the truck legally and paid fees and taxes. But, what if there had been an issue with the title and it was necessary to go back to the prior owner, the business? What if there were an IRS or court-ordered lien on the company’s possessions? What if, instead of a business ownership, the truck had come from out of state and the registered owner were a deceased person? Try cleaning things up with the registered owner then.
CarFax writes:
“It isn’t unusual for a successful curbstoner to sell three or four cars in the span of a few weeks by listing cars under the “for sale by owner” or “private party” sections of online classified listings. They may even invent elaborate excuses to explain why they are selling a car that they don’t have any records or history for, including the title.
“’It’s my failing mother’s car,’” or “’My son is away at college and he asked me to help him sell his pride and joy.’” The lies seem plausible, but a curb-stoner will use a story to help them sell the car and make a few bucks.”
This flyer from StopCurbstoning.com further warns against curbstoning pitfalls.
DON’T TOTE THE NOTE
Small dealers with a commercial lot, like the “Buy Here, Pay Here” shops, also buy at auction and resell. Some of those cars have “clean” titles and some are rebuilt. I’m not getting into the used car financing issue, except to say this: Don’t do it.
One such dealer we met on Lamar Avenue in Memphis had advertised a Nissan Versa without even removing Pyramid Auction’s inventory sticker from the windshield. We didn’t buy anything there, but I will note that they were friendly and it was a family effort – in the office were children and moms and dads and grannies – and they invited us to stay and eat some chicken they were fixing to cook on a grill outdoors.
Another encounter with a small dealer on Lamar did not turn out so well. This was a 2010 Scion xB hatchback with about 158,000 miles on it. This seller claimed to be only the second owner. He had used it to deliver medical supplies, he said, having put about 30,000 miles on it, and was only selling it because he had bought a van for his increasing workload. I wondered how the back of the car got covered with straw while he delivered medical stuff. His daddy operated a car lot, so this fellow had his Scion parked there.
As we took it for a drive on Nov. 8, we discovered in the glove compartment a receipt where it had been bought at Memphis Auto Auction, 3719 Old Get-well Road, Memphis, on Aug. 1, 2019, for $2,965, including fees. Also in the glove compartment was a receipt from Wal-Mart where he had bought tires on Aug. 2.
Upon returning the car, I simply asked, “How long did you say you had owned it?”
“Oh, about 13 months,” said the erstwhile seller.
RUSTY BOTTOM
I have always heard, “Don’t buy a Yankee car.” Cars from up North have been subjected to road salt and bad weather. The problem is that the under-carriage of those cars may be rusted.
This is not actually a deliberate attempt to cheat someone – usually – but I will take this as an example of why it is key to have a mechanic look at a car before you buy it. (While a vehicle history report cannot do a mechanic’s job, it will show where the car has been titled and serviced.)
The first Scion xB that we saw -- in spite of not looking for one – was a 2009 with about 132,000 miles. Scions were discontinued after 2016 as the millennial market did not sufficiently go for them.
This was at a small lot on Gallatin Pike in Nashville, and the owner, Chira Mayi, was helpful and accommodating. We agreed on $4,300. I had never driven a Scion, but it handled well, and it was roomier that I had imagined.
“What’s that stuff on the motor?” I asked him after raising the hood.
“Salt deposits,” said Chira, who had bought the car at auction and said it had a clean title.
“Where is the car from?”
Chira noticed that the windshield had two city stickers – from somewhere. He looked closely.
“Chicago.”
I looked under the car, such that I could, and did not see any rust or damage.
CABBIE CAR?
That night, on the Internet, the first story I found about Scions had this headline:
“Scion xB: The Ultimate Cab for Urban Cities?” The writer had taken a cab ride in Chicago in a Scion. Was this car a former Chicago taxi?
The next day we were going to take the car to a mechanic, but first Chira ran an AutoCheck and gave it to me. There was one minor wreck on the record, and reading between the lines, it seemed that the last two years of its service in Chicago – before somehow making its way to a Nashville auction – the car was driven an average of 20,000 miles a year. It was not a “fleet” car, the AutoCheck said – it had been used as a personal car -- but could it have been a Lyft or Uber car?
We took the 2009 Scion to Kwik Kar on Charlotte Pike. Proprietors Thomas Overton III and his dad said they would do a free pre-buy checkout. Free is my price range.
After Will the mechanic put the car up on the rack, he said:
“Where has this car been? It has snow tires. They won’t work well here.”
Will continued:
“This car has structural rust under it, a lot of it. Eventually, it would have to be fixed, and it would be expensive. Unless you are just in love with this car, I would walk away.”
And so we did.
GOD, COUNTRY AND EBAY
Here is an outright scam that is going around. I first found it on Craigslist and saw variations of this later. The pitch is for a car that is priced crazy low, and one seller I encountered had an elaborate story about a divorce and being deployed by the military. I could not see the car, she said, because it was hundreds of miles away – but she would ship it to me at no extra cost, and the whole thing could be handled through eBay, which would protect me from getting cheated. Except, it wouldn’t. The more ornate the story, the more likely it’s bogus. This seller -- Lisa or whatever her or his real name is -- ended every email with, “God bless you.” Gratuitously invoking God or Jesus is another sign of a bogus deal.
Here are portions of Lisa’s emails:
“Thank you for your interest in the 2010 Buick Enclave CXL.FWD The SUV has a clear title, 91,952 miles, 3.6L V6 Natural Aspiration, 5-Speed automatic, perfect condition, clear title, accident-free and fully serviced. The engine works great and the automatic transmission changes perfectly.
“I sell it at this low price ($ 1,500 including delivery), because I recently divorced, after divorce, I owned this sedan and I don't need and also I have no space to store it. I have to sell it ASAP because I will be displaced for a year with my medical team. I decide to do this business with eBay Online Services, because in this way we will both be protected. eBay gives you 5 days to test your vehicle for free. All documents, including the title, will come with the car in 2-3 days.
If you are interested in buying my car, please feel free to send me an email anytime.
“God bless you.”
--Lisa Smith
Followup email after I had some questions:
“Right now I'm at Keesler AF Base in Mississippi, doing a special training and getting ready for deployment. The car is already at a storage place in Biloxi, sealed with all documents inside and ready to be delivered to your place in 2-3 days… I decide to make this deal with eBay-Online Services because this way we'll both be protected. By dealing through Online Services we are both covered and nothing wrong can happen with my car or your money…
“God bless you.”
Note: I just now noticed that “Lisa” was selling this Buick Enclave, which is a small SUV as she refers to it in the first email….but in the second paragraph, she calls it a sedan. Probably the email is her boilerplate pitch used for every deal, regardless of the car make and model. Lisa forgot to edit.
MORE HONDA
I wrote the check Friday night for the Honda I was planning to buy Saturday morning. The seller and I had agreed I would take it to a mechanic to look it over first. This seller was very cooperative. It should have raised some red flags that besides the Honda, which was parked on the street, he had four spiffy-looking, late-model cars stacked bumper-to-bumper in the driveway. Since I had possession of his Honda, my anxiety lessened over the possibility of someone buying it out from under me. As I write this, I know how pathetic that sounds.
The damaged headliner was throwing me off, and I drove it to Honda AutoNation on Hacks Cross Road in Memphis. The service adviser agreed that the messed-up headliner looked as if it could have been under water. He looked in the trunk where a spare tire would go -- if the car had a spare.
“This is where you might see debris if the car had been under water,” he said. There was none. He also said that those cars needed to have the automatic transmission fluid changed every 30,000 miles. There was no way to know if a previous owner had ever done that.
“If they have never done it, and you do it now, it will ruin the transmission,” he said.
My anxiety was turning up, but in a different direction.
The car had an open recall about an air bag warning light.
“Can you check that?” I asked. “It won’t cost anything, right?”
“If we check it out, and it needs to be fixed, that’s covered by the recall,” he said. “But if we check it out and it’s all right, it will cost you seventy dollars.”
That did not make sense to me.
“Could you just put it up on a rack and look underneath?”
“We’re too busy for that today, but we do offer a free pit stop,” he said. “You can schedule one for next week.”
PIT STOP
The “pit stop” was a free checkup and sounded like a good plan. Making an appointment for Monday, I clearly had lost my concern about someone else buying the car.
At this point I decided I should worry about the title. A CarFax costs $39.99, a small investment to keep from making a potentially major mistake.
We trekked to nearby Gwatney Mazda on Winchester, where we had bought two new Mazdas in the past. The trouble with trying to buy a cheap used car from a new car dealer is that they typically want to sell only late-model cars that were not in my price range for this quest. Aaron in the service department said if I took it to a car wash and put pressure on the back window, it would reveal any leaks, which could have caused the headliner problem.
’30 YEARS IN THE CAR BUSINESS’
Used car manager David Brown listened to me whine and complain, then came out and looked at the car.
“This hood’s been painted,” he said.
“How can you tell?”
“Thirty years in the car business,” he said.
He scanned the VIN on the driver’s side door post with his phone and pulled up a CarFax that showed a diagram of a wreck to the front end and the mention of another wreck that had damaged the rear end. The bottom line on the report read:
“Salvage title/totaled.”
“You don’t want this one,” he said.
David stuck his head in the car and said to my wife as if he did not think he was getting through to me:
“Don’t let him buy this car.”
NO INSURANCE
I did not need to know any more – but for good measure, and now that I was back “on brand” and annoyingly obsessive, I called an insurance company. They said the car was not insurable by them as it was a salvage title. Even though the seller had a good title, and probably I could have gotten a clean, ”used” title from the state and not a “rebuilt” title, the VIN would ultimately give it away.
Bringing the Honda back to the seller after about three hours of figuring things out, I handed him the key and said CarFax showed the car had a rebuilt title. He looked concerned and again showed me the “used” certificate of title he had gotten in the mail. He was crestfallen. I did not ask him point-blank if he knew it was rebuilt – surely he said. He had told me he bought the car in Florida seven months ago.
How does someone in Memphis come to buy a car in Florida?
“My son and I flew down there on vacation,” he said, “and drove back in the car.”
That had sounded sketchy, but, maybe.
Later, I contacted the Shelby County Clerk to see how something like this could happen.
RE-BRANDING AS REBUILT
“If we get a title from another state and they did not brand it as salvage, then we would not brand it as salvage,” explained title supervisor Shelva Stafford. “When we got it, the Florida title must not have been a salvage title.”
I pressed her to look it up by the title number, which I had from taking a photo of it.
It did not take long for her to say:
“This should have been branded as rebuilt.”
“How does that happen?” I asked.
“Clerical error,” she said.
“How often would something like this happen?”
“Not often,” she said.
“Do you think he knew it?” I asked.
“He knew,” Shelva said.
“We will be issuing a rebuilt title to this man,” she said. “He will get it in about two weeks. He won’t be happy.”
It occurred to me that by now he may have sold the car.
It also occurred to my wife, the psychic one, that it may not have been a clerical error but that this seller had some inside help.
I posed that to the Shelby County Clerk’s title supervisor. That’s not an accusation, I said, but could that be possible?
“I cannot answer that,” she said.
The title supervisor probably is right that during the course of handling many title registrations and issues during a day, the helpful person whom you see when they cry out, “Number 99. Ninety-nine?” could easily fail to type in that a title is branded as rebuilt. However, it is feasible that a shade tree flipper and a title clerk could have something cooked up. At the Mullins Station location of the title office, I observed four clerks taking people by numbers that one pulls to establish place in line. So, the luck of the draw, right? When one man’s number was called, however, he said he was waiting on a certain employee to help him. We presumed a language issue.
In conclusion to the Honda waste-of-time experience, I could see how that could happen as an innocent mistake, but I also see how it could be set up. That this seller flew to Florida, bought the car to flip it, turned in a “rebuilt” title and came out with a clean “used” title could be a coincidence. If you believe in coincidences.
THE DEALERS
We ended up buying a traded-in car from David Brown at Gwatney Mazda. The benefits were that someone legit had checked the car out before accepting it for trade…and that we would get a clean title. That is a key advantage in buying from a reputable dealer. Should something flukey happen in registering the title, the dealer would be compelled to make things right as dealers are regulated by the state.
Dealing with a dealer does not assure success in the ethics department, however. I am reminded of when we bought a car from Wolfchase Nissan on Oct. 31, 2014. Maybe buying a car on Halloween was a bad sign. The car had never been titled to an individual, but they had been unable to sell this all-electric 2012 Nissan Leaf with about 4,400 miles on it. In fact, they had held it so long that they had to declare it as “put into service,” as was explained to us. That meant the clock had started ticking on the warranty.
“When did the warranty begin?” was a logical question.
“July 14th,” said the salesman as he looked into a file. That would have been 109 days ago, so not bad, I thought.
Not until 2017, when I called Nissan corporate to ask a question about the warranty on the lithium-ion battery, did I learn the car was “put in service” November, 30, 2012 -- a difference of 20 months from what we had been told. Thus, the manufacturers warranty would run out that much sooner.
I then talked to the dealer’s finance manager, and he sent me a document that would have set the record straight about the date the warranty began. Unfortunately, we never got a copy of that document. That’s not the worst thing.
The worst thing was that someone had forged my wife’s signature as accepting the disclosure.
That was a case of, fool me once, shame on you. But if I buy a used car and don’t investigate the title and don’t have a mechanic check it out, it would be shame on me. No need for anyone else to have an adventure in buying a used car -- the hard way.
Gary Moore operates Moore Media Strategies, founded non-profit Citizens Media Resource, makes films about social justice issues and writes about First and Fourth Amendment issues in Daily Kos and elsewhere. Personal experiences drove him to this consumer piece.