How to protect your money when buying a car

Buying a car? Here are simple tips to check the seller, protect your money and avoid common car-buying scams.

Buying a car is a big and expensive commitment, so it’s important to make sure your money is protected before you pay a deposit or complete a purchase.

Whether you’re buying from a dealer, online marketplace or private seller, there are some simple checks you can make to reduce the risk of losing money to a scam or rogue seller.

Here’s how to protect your money when buying a car.

Remember, you can buy a brand new or used car right here on Carwow. And you can sell your car, too. We’re here to help you through every step of your car-changing journey.

Check the seller before you pay

The first step is making sure you know exactly who you’re buying from.

Check the dealer’s details

Search for the dealer independently and look for reviews, complaints and information about the business.

If the dealer is a limited company, use Companies House to check its registered name, company number and status.

Make sure these details, including the seller’s bank details, match the information provided by the seller. When setting up a new payee, your bank may also verify the payee’s name, so make sure this matches the seller’s name exactly.

Don’t rely solely on reviews or information published on the dealer’s own website.

Check where the car is located

Before paying a deposit, make sure the car actually exists and find out where it is. Where possible, visit the dealership or seller and see the actual vehicle.

If you’re told that the car is somewhere else, ask why and establish how and when you’ll be able to inspect it.

Be particularly cautious if you’re being asked to transfer money before you’re allowed to see the car.

Check the advert

Read the advert carefully and make sure the details make sense.

Check the:

• Registration number
• Mileage
• Specification
• Photographs
• Price
• MOT and vehicle history information

If anything doesn’t match, ask the seller to explain before you make a payment.

If you’re buying through an online marketplace, check its safety advice and payment rules, too.

Carwow also provides advice on staying safe online.

Before you pay a deposit

A deposit is usually part of buying a car, but don’t hand over money until you understand exactly what you’re agreeing to.

Understand the deposit terms

Ask the seller:

• How much is the deposit?
• What is it securing?
• Is it refundable?
• What happens if the sale doesn’t go ahead?
• What happens if the car isn’t as described?

We’d recommend getting the answers in writing before paying.

There’s no universal deposit amount that’s automatically safe. If you’re being asked for a large sum before you’ve seen the car or completed basic checks, consider whether you’re comfortable with the risk.

Don’t let a seller put pressure on you

Be wary if you’re told you have to pay the deposit immediately because:

• Another buyer is interested
• The price of the car will go up
• The car will be sold if you don’t pay today
• The deposit is only available for a limited time

A genuine seller should give you enough time to carry out basic checks.

Be suspicious of prices that look too good to be true

Compare the car with similar vehicles for sale. And if it’s significantly cheaper, find out why.

A low price doesn’t necessarily mean a scam, but it should prompt you to carry out some more additional checks.

Be especially cautious if an unusually cheap car is paired with pressure to pay quickly or an unwillingness to let you inspect it.

Before you complete the purchase

Once you’re satisfied that the seller and vehicle are genuine, there are still steps you can take to protect your money.

Choose your payment method carefully

Think about how you’re going to pay and what protection may be available if something goes wrong.

If you’re paying by bank transfer, check the account details carefully before sending the money. If anything about the payment request looks unusual, stop and verify it with the business using independently sourced contact details.

Paying by debit or credit card? Ask your card provider what protection may apply.

If you paid by credit card and the cash price cost more than £100 and up to £30,000, you could be protected under Section 75 of the Consumer Credit Act, depending on the circumstances.

Don’t assume that any particular payment method guarantees that you’ll get your money back, though.

Keep your payment records

Keep confirmation of every payment you make, including:

• Payment confirmations
• Bank or card statements
• Receipts
• Invoices
• Order forms
• Contracts
• Deposit terms
• Conversations with the seller

Keeping all these creates a clear record of what you agreed to and what you paid for.

Save the advert and vehicle details

Take screenshots of the original advert before completing the sale.

Keep copies of the vehicle’s:

• Registration details
• Advert photographs
• Advert description
• Mileage
• Price
• Vehicle history information

Online adverts can be edited or removed, so don’t assume they’ll remain available if you need them later.

If you’ve already paid and something goes wrong

If a dealer disappears, stops responding or you believe you’ve become a victim of fraud, act quickly.

Contact your bank or car provider

Get in touch with your bank or card provider immediately and explain what has happened.

If you paid by bank transfer, ask your bank to investigate the payment and whether you may be eligible for reimbursement under the rules covering authorised push payment (APP) fraud.

For payments made by debit or credit card, ask about Chargeback and other protection that may apply.

Report suspected fraud

If you believe you’ve been deliberately defrauded, report it to Report Fraud, the UK’s national reporting service for fraud and cybercrime.

You can report fraud through the Report Fraud website or by calling 0300 123 2040.

You’ll then receive a crime reference number, which can be useful when dealing with your bank or other organisations.

Report the dealer to Trading Standards

If you believe a dealer has breached consumer protection laws or is continuing to trade dishonestly, you can report them to Trading Standards.

Use the official government service to find your local Trading Standards office.

Include as much information as possible, including the dealer’s details, the vehicle advertised, how much you paid and what happened.

If you think you may have been a victim of fraud operating on Carwow, please contact our Customer Support team at hello@carwow.co.uk.

Car change? Carwow!

Looking for a new set of wheels? With Carwow you can sell your car quickly and for a fair price – as well as find great offers on your next one. Whether you’re looking to buy a car brand new, are after something used or you want to explore car leasing options, Carwow is your one stop shop for new car deals.

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