Scammers know that seniors are likely to trust others, may not be familiar with the latest car-buying tactics, and are less likely to report fraud. Based on the FBI’s 2023 Elder Fraud Report, seniors lost over $3.4 billion to fraud in 2023 alone, and car related scams were a large portion of that.
Unfortunately, car scams aimed at people over 60 are all too common. Scammers are creative and never run out of tricks; from shady dealerships to online tricksters, they always think of new ways to scrounge off unsuspecting seniors. However, you can relax, as here of the 12 most common car scams aimed towards seniors and how to avoid them! Read on.
The “Phantom Car” Scam
As per Statistica, in 2022, about 18 percent of new car sales in the U.S. were executed online, and that number is estimated to grow to 30 percent by 2030. You come across a cutthroat deal on a car online that sounds too good to be true, and it is, along with the listing!
The scammer insists on a deposit upfront before you can even view the car. They then disappear after you send money! If someone is not willing to let you see the car in person, it’s a scam. It is also suggested that you only buy from trusted dealerships or verified sellers on reputable platforms.
Fake “Grandchild in Trouble” Car Emergency
Statistics by Comparitech show that in 2022, about 68.4 million U.S. citizens reported losing money to phone scams. A scammer calls pretending to be your grandchild or a police officer saying they’ve been involved in a horrible car accident and they need you to wire money immediately.
Seniors act quickly without verifying the story because of panic. When you get a call asking you for money urgently, pause and confirm. Before sending money, call your grandchild directly or ask other family members.
Rolling Back the Odometer
Some shady car sellers habitually tamper with the odometer to make an old car appear as if it has low mileage and is well maintained. This is even easier than it was before with digital odometers! If you suspect a car’s wear and tear don’t match the mileage, then be suspicious. You can also check the car’s mileage with Carfax or AutoCheckor have a trusted mechanic inspect the car for you.
For example, a Chicago TV news station featured the story of one car shopper who paid what he thought was a steal for a 2015 Audi A6 with just 66,000 miles, only to find out after he registered the car with the state that it had 185,000 miles on it.
Fake DMV or Insurance Calls
Forbes reported that about 20% of insurance claims are fraudulent. Scammers call you, portraying themselves to be DMV or insurance agents, claim you owe fees or must update your registration immediately. They ask for personal details and credit card info.
The DMV will not ask for payments over the phone. Hang up and contact your DMV or insurer directly through the official contact information.
“Title Washing” Scam
Flood-damaged or salvaged cars are sold by scammers with fake clean titles. The mechanical issues this car will have are a ticking time bomb! Consumer Reports revealed that 454,000 water-damaged cars hit the road in 2023.
It is a clear red flag if a car is priced way below market value and has no detailed history. Before purchasing, always check the vehicle history report and have the car inspected by a mechanic.
The “Bait-and-Switch” Financing Scam
You agree on a low-interest financing deal at the dealership, but when you go to sign, the rate is much higher! They say it was a ‘mistake’, and you are pressured into accepting the new terms.
Be suspicious of a dealer who suddenly alters financing terms after an agreement. Ensure you get everything written and have a trusted person review loan agreements before signing.
The “Too Good to Be True” Repair Deal
More than 75% of Americans use an auto repair service yearly. For the average American, auto repair and maintenance services cost $397 per year. Some dishonest mechanics mislead seniors into doing unnecessary repairs by exaggerating minor issues or simply creating fake ones!
A mechanic shouldn’t pressure you to fix something immediately without proof. The best advice is to always seek a second opinion before agreeing to expensive repairs.
The Parking Lot “Damage Repair” Trick
Parking lots can be a little spooky—and not just because the National Institute of Justice says 7.3% of all violent crimes in the U.S. happen in parking lots. A scammer will approach you in a parking lot and say your car has a dent or a scratch.
They’ll offer to fix it for you ‘on the spot’ for a ‘cheap’ price, but they’ll either take your money and go or make it worse. No legitimate auto repair expert simply approaches people in parking lots. Please take your car to a reputable body shop if you need repairs.
The Fake “Extended Warranty” Call
Based on Consumer Affairs statistics, the market size for extended auto warranty providers was $20.5 billion in 2023. You may receive a robocall that your car’s warranty is expiring, and you need to pay now to extend coverage.
It’s a phony service that will cover nothing. Real warranty companies don’t call people to renew. If you want an extended warranty, you must contact the car manufacturer.
The “Stranded Driver” Scam
A scammer pretends to be a motorist stranded and needing help with cash for gas or repairs. They act desperate, but they will disappear after you give them money. They will not take assistance other than money, with excuses such as “I don’t have a phone” or “My credit card isn’t working.”
Instead of cash, offer to call roadside assistance; if they refuse, it’s probably a scam. If they say their car is nearby, suggest that you walk to a gas station with them (most scammers will refuse and leave).
The “Yo-Yo” Scam
According to Consumer Affairs, there were more than 1.4 million new vehicle sales in the U.S. in May 2024. Once you sign a car deal to purchase a car, the dealer will call you after a few days, say the financing fell through, and ask you to bring back the car or pay a higher rate.
If a dealer lets you drive off before finalizing financing, that’s probably a scam. Accept deals only if the financing is finalized prior to leaving the lot.
Fake Car Auctions
The global online car auction market is expected to grow at a CAGR of about 4.33% to reach $29.39 billion by 2032, from $20.07 billion in 2023. There are online car auctions with cars at ridiculously cheap prices.
First, you have to pay upfront to bid, but once you do, the cars don’t exist, or the auction disappears. An auction that asks you to pay before bidding is a scam. You should only stick with reputable auction houses like Mecum or Barrett-Jackson.
Disclaimer – The Finance Key does not provide and does not intend to provide financial, investment, tax, or legal advice. Information contained in this article is for informational and educational purposes only. This list is solely the author’s opinion based on research and publicly available information. The inclusion of links to third-party content is not an endorsement by The Finance Key of such content or services. Please do your due diligence and use your discretion.
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