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Guide to Buying a Car on Ebay

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The term “guide” above is used very loosely… :) Anyway, thus far I’ve purchased two cars in my life – both were off Ebay and both were resounding successes. The first was a low-mileage 2000 Acura Integra and the second was a low-mileage 2003 Toyota Celica, both were off Ebay, and both were shipped to my location. I’ll discuss the benefits and drawbacks of buying Ebay along with some simple to understand strategies or informational tidbits so that those of you considering buying on Ebay will understand a bit of what you expect.

Using Ebay
You’ll run into two types of sellers on Ebay: Dealers (or their representatives) and private parties. Whereas Kelley Blue Book will list two different prices depending on who you’re buying from (dealer being higher), this difference doesn’t exist on Ebay – you will pay what the market will bear, which is typically lower than both KBB values. You are afforded no additional benefits or warranties by purchasing through a seller who is a dealer (just like in real life).

Ebay Protection Programs – Due to the risky nature of buying a car, sight-unseen, Ebay will protect you (like any other auction) as long as you purchase it through them. The main part of the program is Vehicle Purchase Protection, free, which will protect you up to $20,000 or the value of the car.


Benefits of Ebay:

  1. Information: Use it as part of your research process in figuring out how much the car is truly worth. Ebay will always bring in the lowest price because of the large market and the low number of buyers willing to purchase via Ebay. Remember to add in about $600 to $1000 for shipping, depending on where you are and whether you want covered or uncovered transportation.
  2. Price: As mentioned before, Ebay will probably always be the cheapest price.
  3. Low Mileage: Not always but Ebay cars tend to have lower mileage because of the exponentially greater risk in buying a car with higher mileage without a test drive, this is especially true with manual/standard transmission cars. Would you buy a 50,000 mile manual vehicle?

Drawbacks of Ebay:

  1. Sight-Unseen: You can always get an inspection on the vehicle but you will never be able to test-drive it, unless it’s a local seller. I cannot stress this enough – get the monthly membership to CarFax and pull up the information on every car you see.
  2. Shipping: Unless it’s local, you’re going to have to ship it and it could cost up to, if not more than, a thousand bucks.
  3. Registration, Titling, Taxes: You would also deal with this as a private party sale, but if you were to purchase a car from a dealer you would probably be able to avoid going to the DMV to register, title, and pay the tax on your car.
  4. Beware Salvage Titles: The listing should have this information (or you should walk away) or otherwise CarFax definitely will. They typically aren’t trying to deceive you because if they don’t list it and the title comes back as salvage, Ebay protects you, but you need to read it carefully. Most states have much stricter rules for registering salvaged cars.

Strategies to Use on Ebay:

  • READ THE LISTING THOROUGHLY! Ensure that’s the vehicle you want with the features you want before going any further. Finding out that it’s a cloth instead of a leather interior after you receive the car is something that should never happen. I personally lean towards auctions with a copious number of photos that give you a very good idea of the interior and exterior of the vehicle.
  • The reserve price is usually around $500 under the Buy It Now price. This is something I’ve learned through observation and usually is a pretty good way to guess at what the reserve price is.
  • Note that the vehicle history report available via Ebay (for $7.99 or $14.99 for ten) is through Auto Check by Experian, NOT CarFax.
  • Note the location of the car. You should put a premium on vehicles within driving distance because of the shipping costs especially since you’ll probably be looking at used cars under $20,000 and an extra $1000 is a solid 5% to the price. It’s also a pain to have to talk to the truck driver and find a suitable location for the drop off since he/she will be driving a huge truck and probably can’t just pull up to your apartment/house.
  • Consider calling/emailing the seller. Most sellers are entertaining only a handful of buyers so talking to them may give you an idea of their background and their trustworthiness. I purchased the Acura from a dealer representative and the Toyota from a private seller in Florida, I spoke with both before the sale and they gave me confidence everything was on the up and up.
  • Restrict your purchase to slightly used cars, preferably still within a manufacturer’s warranty. The usual 36 month, 36,000 mile warranty typically will transfer without cost. In some cases, like in those 10-year 100,000 mile warranties on some cars, the warranty will drop to 5-year 50,000 miles from whatever it is. Also, a good barometer of how many miles to expect in a year is 12,000 – less is much much better. This is where CarFax comes in handy…
  • USE CARFAX. Find out if it was a leased or owned car, what its former life was, etc. You’ll find that some cars sat around on a lot for a while (titled to a dealer inventory), moved a bit, and then sold later (as was the case with my Integra). So it may have accrued that 8,000 miles last year in the span of 4 months and then sat in a lot for 8 months. While the mileage is still low, it had some heavy driving for 4 months! That’s the information you’ll need to discover using CarFax.

I would say that buying a car on Ebay is as safe as buying from a private party, except you can’t test drive the car. You can still get an inspection if you want, so that option is still available and Ebay still protects you up to the value of the car or $20,000. If you have any questions about my personal experience, feel free to ask and I’ll try to answer promptly.

{ 26 comments, please add your thoughts now! }

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26 Responses to “Guide to Buying a Car on Ebay”

  1. Jose says:

    Very helpfull guide.
    Thanks to you I will now consider ebay to buy my next car.

  2. jim says:

    I was reading the Economist yesterday and it turns out Ebay Motors is currently their biggest money maker.

  3. Allan W. says:

    One thing that baffles me is that in many cases (in my experience, at leas 90%), the auctions posted by dealers end with the reserve not having been met and result in no sale. Why do dealers do this?

  4. jim says:

    The cost to list a car on Ebay is pretty low and dealers are afraid of selling the car for too little and so they usually (based on my experience) have a reserve that’s about $500 under the Buy It Now price. Why do 90% end in no sale? I’m not sure but it probably stems from being afraid that they won’t make enough money and get chastized by their sales manager.

  5. TOM says:

    Why can’t I test drive the vehicle when I arrive to pick it up? Albeit, I’m the winning bidder, if something isn’t right, and the seller didn’t disclose it…the cashier’s check will stay in my wallet, and the deal is off.
    I’ll only be out the air fare or the cost of getting there.

  6. jim says:

    Tom – That’s if you go to pick it up, I just mean if you get the car shipped to you then you won’t have the opportunity to test drive it before you receive it… that’s all.

    If you show up and something isn’t right and the seller didn’t disclose it, you can terminate the deal on those conditions.

  7. kang says:

    HI,

    Is it OK to buy from a private owner who resides in other country?
    The car price he has quoted is much lesser than the market price, but it seems that he cannot register the car over there, which he bought here in US.
    He would take care of the shipping costs that is included in the price quoted.

    Also, he says that I get 7 days to inspect the car. If I find something problematic, I can return it in 7 days. The payment for the car would be secured thru eBay. i.e eBay would hold the payment for 7 days and release it after I give a go ahead.

    Does eBay provide with secured payment option?
    And how far can I trust this transaction?
    what are the things I need to make sure before I go ahead?

    • sharda sonnier says:

      Kang did you ever make the purchase because

      Im in the same boat as you? Debating if I should trust it or not. So I was wondering did it work for you?

  8. jim says:

    kang -I don’t know the answers to your questions and I am not qualified to dispense advice. Honestly, I would avoid getting into a transaction of that magnitude with someone in another country if it were me.

  9. Kristin says:

    Hi, I have bought stuff off eBay several times…. just not a car. I am in LOVE with this car on eBay, but I am scared to death something will go wrong. Please tell me I will be covered by eBay if anything goes wrong… I am so scared I will pay and never see my car. =(

    Thanks, Kristin

  10. LISA says:

    WILL YOU REFER YOUR BUYERS? I’M JUST SO UNEASY WITH THIS. LOL I GUESS I’M USED TO TOUCHING AND FEELING MY PURCHASE BEFORE I BUY. LOL

    THANK YOU SO MUCH!!!
    LISA

  11. Josh says:

    If i need to finance the car that I am interested in buying on ebay, do you recommend financing it through the option on the listing or financing it with my own bank?

  12. Tony says:

    What if you buy the vehicle through Pay Pal but they never ship you the vehicle! Does the seller already have your money or is there a delay until you receive the merchandise?

  13. jim says:

    Tony – If you’re buying a car, I recommend using an escrow where you have some protection. If you pay via PayPal, they have the money.

    • sharda sonnier says:

      Hello Jim I have a question. This owner is selling a nice car for a cheap price but there’s a problem;he’s in UK, London but has the car out here in Houston and i want to buy it because I am in Houston and the car looks nice, but..I’ve never bought from eBay and he wants to sell the car through ebay. is this safe enough with thfor protection. Because the dealer seems honest through his emails but he won’t give his number. He says its for his protection. What’s should I do? Or could you help me out a little. Your article is helpful I just think this is sort of a different case. Thanks,please get back at me.

  14. paulo says:

    I would like to know the step by step process that would take place when I win in a bid from e-bay. Especially I’m concern about registering the vehicle from my own state, when the car i just bought from e-bay will come from other state.

  15. craig says:

    ok, if im the winning bidder on, lets say a, ponitiac…what would be the best way to pay for it and make sure its the same car i bought when i recieve it…and to make sure they dont get my money before i decide that i really want it.

  16. Chris Del Vecchio says:

    I saw a Toyota Camry on Ebay and starting bid was $100 with 23 hours left on the bid(from a dealer). I am local and won’t have to pay any shipping fees and have been invited to test-drive it. If I bid $125 on the car and win, other than that $125, what other costs would I be looking at paying?

  17. Bobbie says:

    Why is there no recourse to amend eBay feedback when you realize you have been scammed via eBay motors?

  18. Danny says:

    If you have the car shipped to you how do you take care of the title work. This is the part I am confused about since I have always bought local. Normally you have to have both parties sign the title in front of a notary right? How does this work if you have the car shipped to you? Found a car a bit out of the way but willing to pay for shipping just not sure about the title work. Thanks

  19. jabari says:

    hi im a college student that looking at a camery for sell through ebay i seen their add on craiglist listed as buyer and so she tells me to give her simple information- full name,full shipping address, home/cell # so I can open a case.(with no further obligation or fees). now is this ok to do i really dont want to be scamed again

    thank you

  20. Devon says:

    Kang that deal sounds shady How the scam works: This is actually not a car dealer scam, but it is a huge epidemic. , and it’s a growing eBay scam too. Sometimes the scammers steal images from a car dealer and pose online as the car dealer. But mostly, these internet scams appear online as the seller of a used car. They place ads on Yahoo Motors, AutoTrader, Craigs List, eBay Auctions, eBay Motors, every known vehicle and motorcycle classifieds site on the internet has been hit. The scam begins with you buying a used car (or other product) online and you see a hot BMW or Mini Cooper, or Camry, or Mercedes, or Harley Davidson whose selling price is much lower than other listings for the same item. So you ask the seller a question. The seller replies with a “Dear Sir” form letter, rarely do they mention your name, it’s all scripted. It usually has poor grammar and spelling too, and the seller claims to be in Europe and cannot keep the car. Via email, they have you outside the eBay safe harbor, or whatever site you are using. He wants you to use a particular 3rd party escrow site, “he’s used them many times already.” Unknown to you, he just created that fake escrow site only a few days ago and he’s lying. He is offering to pay shipping for the car! Do you know how much shipping is on a car across the U.S.? It’s usually about $900. That’s a big Red Flag. The “seller” has setup that fake escrow web site that looks better than most bank web sites and is about to steal your money. They convince you to register on the “escrow” site, and you get payment instructions to Western Union or MoneyGram the funds to the escrow company, then you never see your money again. No undo on the Western Union either, once your cash is wired, they can pick it up anywhere in the world in minutes, usually in UK, Spain, Romania, Russia, Netherlands, Europe. There are many twists to this scam, they often trick you by telling you they are signed up for escrow with Yahoo Motors, or eBay or Square Trade, none of which in reality do escrow or collect money for cars. You then receive official looking spoof phishing emails that appear to be from Yahoo, Square Trade, eBay, etc., with instructions on how to pay their “payment agents” via Western Union. The scams have the same goal, to trick you into thinking you are sending thousands of dollars to a trusted escrow company. This scam is so prevalent that from 2003 to 2004, These sites pop up at the rate of at least a dozen per day, with thousands of scam listings and auctions running all over the internet at any time. Now that you know what to look for, they are easy to spot.

  21. Jennifer says:

    Hi! I have a question that I would like to try and get addressed ASAP! I am currently looking to buy a car no higher than $3,000. Well, I recently looked on Craigslist and found a BEAUTIFUL 2008 Nissan Altima 2.5 SL and the owner was only asking $2,000! My first reaction was maybe my eyes are playing tricks on me and it says $20,00. Sure enough, I clicked on the link and the car was $2,000. I quickly emailed the owner to find out if the car was still for sale and why so cheap? She emailed me back and informed me that she was in the military and would need to seek the car before September30, 2012 because she was leaving for Afghanistan. She let me know that the car was in great shape and emailed me more pictures and the carfax history report which checked out wonderfully! She said that all she needed me to do was email her my name and shipping address and eBay would handle the financial aspect and that I would be allowed a 10 day warranty period to make sure this was the car I wanted. She mentioned that te car would be coming from Detroit, MI and the shipping would be at no cost to me. I am very excited yet still a tad but concerned. Do sells like these happen often? Should I be worried that this is a scam? I would hate to just “give away” $2,000 and not receive the beautiful car. Can someone pleeeeease help me?!??

    • Kim Lewis says:

      Be very worried. I was suppose to go buy that same car tommorow. Is its blue 2006 Honda civic with like 58,000 miles on it with a sun roof. And her name is Emma ford. She told me that she live some where else.

  22. Kim Lewis says:

    Well I see its a different car but same story. How did it turn out.


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