Blog Post  Buying a car on Craigslist? Know who you are buying from.

Consumers often consider buying from a private seller as an alternative to buying from a used car dealer. Sometimes auto dealers may pose as private sellers and post vehicles under the “for sale by-owner” section of Craigslist or on social media sites such as Facebook.  This practice is also known as “curbstoning.”

One version of this practice involves licensed dealers who partner with an unlicensed individual who poses as the vehicle’s owner. The “owner” creates a ad or a post offering the car for sale. The seller completes the transaction somewhere other than the dealership, but the name of the dealership may not be on the title and purchase documents. Then, if the buyer contacts the seller about problems with the car, the seller says it was never their car. If the consumer contacts the dealership, the dealer may say that they’re not responsible because the car was sold offsite.

Another variation involves unlicensed dealers who fraudulently purchase cars at wholesale auctions by paying a licensed dealer to use their auction license number.  They may also obtain their cars through a title skipping scam in which they target individuals who need to sell their car quickly, pay a low cash price for the car and re-sell it for a much higher price without putting their own name on the title. According to Massachusetts state law, anyone who sells more than three cars in a twelve month period is considered a dealer and must have a Class 2 dealer license.

The Office of Consumer Affairs and Business Regulation can provide helpful information to consumers:

• Print out a copy of the ad. It may come in handy if the original post has expired. Even if we can’t connect the unlicensed seller with a licensed dealer, the unlicensed seller must participate in a Lemon Law hearing if they sold three or more cars or if they took a fee to sell the car for someone else.
• Attempt to contact both the seller and the dealership (if you have the dealerships contact information). Regardless of where you bought the car and whether it was new or used, you may have rights under the state’s Lemon Law protections. If the car has over 125,000 miles then the dealer is bound by the Implied Warranty of Merchantability.
• Contact the licensing authority for the city or town where the dealership is located. Selling cars in the scenarios previously described is illegal and dealers can lose their licenses, and both licensed and unlicensed dealers can be fined.