It is not surprising that people are always scared of buying a used car. Frauds in used car is becoming more and more prevalent, especially after Katrina and due to the current economy.

We have compiled tips and various red flags from different website to help you in buying a used car and avoid any possible fraud and to avoid getting ripped off.

Problem Car Title

The first step to verify the title is to check with the DMV. Usually, you’ll just need the car’s VIN number and may be charged a small fee (often these transactions require you to go to the DMV’s office). You need to make sure the VIN on the car matches the VIN on the title and the seller’s name matches the one on the title. This record check is also valuable because it will show any outstanding liens on the title, which means that the owner is still making payments on the car and doesn’t own it outright. This could complicate the sale later, especially if you’re buying from a private seller.

However, even if the title appears to belong to the seller, it could still be fraudulent. There are a few signs that may signify foul play. Play close attention if the vehicle was recently brought to your state and titled or if the VIN number on the car is obscured or shows signs of tampering. The title should look official, meaning it will be printed on special paper with watermarks (visible when held up to the light). All text, graphics and borders should be sharp, not blurred. If you can, compare the title with an original (perhaps from a friend’s car in the same state) and make sure the two look the same.

Your AutoCheck  or CarFax vehicle report will show any problem titles on the car’s record at any point in its history — everything from hail damage to fire damage. Most of these issues are red flags, but here’s just a sampling of those to avoid at all costs: Flood titles, which means the vehicle has received extensive water damage; salvage titles, which mean an insurance company has at some point declared the car a total loss due to sustained damage; and junk titles, which mean the vehicle indicate that a vehicle is not safe enough for use and the car cannot be titled again in that state.

You should always be concerned about buying someone else’s problems. Before making any deals, write down the Vehicle Identification Number (VIN) which is a 17-digit code usually located on the top of the instrument panel, at the base of the windshield. It will also be on a sticker on the driver’s-side door pillar, and in several other places around the vehicle. Make certain that all the VINs on the vehicle match! If the one on the door pillar is different than the one on the dashboard, or title, or somewhere else, then something is not correct. Leave and find another car.
A problem-free title doesn’t mean it’s valid. Criminals can create counterfeit or fraudulent titles and use them to legally register and then sell stolen cars. If you buy a car without a valid title, it’s the worst-case scenario — you don’t legally own the car you just bought.

No Service Records

One of the most important aspects of a used car is its maintenance history. You want to make sure you’re buying a vehicle that has had routine oil changes and major mileage services. Always ask the seller, even if it’s a car dealership, for all service records. If they can’t provide those for you, you have no way of knowing if the car has been maintained properly. In addition to asking for records, look for a windshield sticker indicating when the car’s next oil change is due. If there’s no sticker or it shows an oil change is past due, ask why.

Vehicle and Accident History Issues

A vehicle history report is essential for any car purchase. You can ask the seller or dealership for the report or access it yourself online using the car’s VIN (Vehicle Identification Number). AutoCheck charges $19.99 for a single report or $29.99 for unlimited reports for 60 days. The report shows accident/damage history as well as title problems, frame damage and an odometer rollback check — any of which should be deal breakers.

Mechanical Problems

Signs of Poor Alignment

Check the tires for wear. Uneven tire wear — balding on the sides or in the middle — could indicate the need for a front-end alignment or a more costly repair to a suspension component.
Bring along a small refrigerator magnet and place it gently (so as not to scratch the paint) along various body panels (lower door, front fender, etc.). If there is any plastic body filler present the magnet will not stay in place, indicating the vehicle has been involved in an accident. Stand away from the vehicle and look at its panels and seams. Does everything line up correctly?

Signs of Repainting
Open the trunk, hood and doors. Look for paint over-spray, a telltale sign all or part of the vehicle has been repainted. Now walk around the vehicle. Are all the body parts precisely the same color?

Signs of a Cracked Block
Check the radiator fluid. If it is foamy or has oil droplets in it, there is a good chance the car has a defective head gasket or, worse, a cracked block or cylinder head, any of which will cause the coolant and oil to mix together. If so, don’t buy the car.

Signs of Flood
Reach up under the car and feel around the top of the gas tank. If you find mud or leaves up there, chances are the vehicle was involved in a flood or, in the case of a sport utility vehicle, taken off-road with some frequency. You can perform the same test inside the car by carefully reaching up under the instrument penal. If you find any signs of this sort of water damage, don’t buy it.

Signs that the Vehicle is Not Local
Check the inside of the car. Look in the ashtrays and under the seats. Listen to the radio. If the buttons are all set to stations in another area, you know the car is not local.

Signs of Driver Abuse
Look at the condition of each foot pedal (gas, brake and clutch). Do the rubber footpads show heavy wear? If the steering wheel is leather, does it show excessive wear? These patterns on a low-mileage car may indicate that the vehicle has more mileage than the odometer indicates. Trust your sixth sense on this one. If you feel the odometer has been tampered with, don’t buy the car.

The Bottom Line

Checking for all these red flags may seem excessive, but they can save you time and headaches down the line. In the end, the AutoCheck vehicle history report, DMV records and seller should be consistent. If any of the information seems fishy, consider walking away from the sale. If any of the above warning signs do surface, you may not even want to give the car a second thought. It doesn’t hurt to walk away, but it can sure hurt a lot to buy a problem vehicle. Plus, with the internet, you can find virtually any car, anywhere. And as they say, there are plenty of other fish in the sea.