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How to avoid auto-related fraud

man with mask driving car

As you search for a new or used car, get car repairs, or look for savings through extended car warranties, be very wary of what you’re paying for and who you’re dealing with.

Price comparison website Clearsurance compiled information from The Federal Trade Commission, FTC, in a recent report and found that the “two most likely ways that drivers get scammed are through auto repair shops or car dealerships.”

Below are some tips to keep in mind when buying a car and going for repairs.

What is an auto-related fraud?

The FTC  generally defines auto-related fraud cases as misleading or deceptive practices related to a car’s:

  • Sale price
  • Financing
  • Leasing
  • Repair/maintenance issues
  • Extended car warranty

1. When buying a used car, check the car’s history

A vehicle history report will provide you with important bits of information like:

  • What damage the car has experienced
    • Even if the car looks great, it’s possible for it to have been in major wrecks.
  • What the actual mileage is
    • It’s illegal to change a car’s odometer, but that doesn’t prevent some car dealers from trying to get away with it. Mileage is recorded every time a car is registered.
  • How many previous owners it’s had
    • A car that’s had only one previous owner is generally worth more than a car with multiple owners.

Vehicle history reports are sold by websites like Carfax and AutoCheck, but you can get information from free or public sources online like and The National Insurance Crime Bureau. You just need the car’s VIN (vehicle identification number).

2. Always take a test drive

With the rise of online car shopping, more and more people are choosing to dismiss a test drive and look up car reviews or watch test drive videos on youtube or social media instead.

If you don’t take advantage of a test drive, however, you won’t truly be able to know what you’re buying. A test drive helps you know:

  • How comfortable you are when driving
  • How the features work
  • How well the car drives (Does it have any issues?)

It’s recommended that you test drive different cars of the same make and model if possible. This way you will know if they all feel the same before you buy.

3. Always demand dealerships give you finance and lease quotes in writing

When you speak with a dealership representative and they offer you a deal, be sure they hand it to you in writing.

An oral promise and guarantee is worth nothing. Be sure to also ask for a copy of your financing or leasing agreement. This way you can be sure no other fees will be added later.

By law, dealerships must provide customers with a copy of every document signed.

4. When getting repairs, check word-of-mouth reviews and the Better Business Bureau

Finding a mechanic you can trust starts with asking around to family, friends and coworkers for recommendations.

The best and most trustworthy mechanics are found through word-of-mouth. If you can’t find anyone in your area who can recommend you a good mechanic, check online reviews and their rating with the Better Business Bureau before stepping foot at the shop.

Read our recent blog on how to find a trustworthy mechanic.

5. Request a written estimate before any repair gets done

Some mechanics work casually, telling you prices without writing it down. This doesn’t necessarily mean they can’t be trusted, but for your own security, it’s best to ask for a written estimate.

Never drop your car off at the mechanic and give them permission to work on your car without knowing exactly what they will do and how much it will cost. Be sure to explicitly tell them to give you a head-up before doing a repair you haven’t previously agreed to get done.

6. Ask the mechanic to show you replaced parts

Some dishonest mechanics will tell you they have replaced parts that they haven’t. If you always ask to see the old parts, you ensure that you’re paying for repairs and replacements that actually happened.

You can additionally ask for the old part to be placed in the new part’s box. That way you know where the new part came from.

Mechanics can tell when a customer is informed. Simply asking for your old parts ahead of any repairs shows that you’re aware of common unethical practices.

7. Don’t be pressured into buying an extended car warranty for used cars

If you’re looking to protect yourself from untrustworthy mechanics and expensive car repairs, take your time.

When choosing a vehicle service contract (also known as extended car warranties for used cars), don’t be pressured into buying anything before you’ve reviewed your options. You don’t have to buy vehicle breakdown coverage as soon as you buy a car. 

Note: It’s very common for dealerships to sell you overpriced extended car warranties. Sometimes referred to as the “Back End” products scam, extended car warranties may even be added to your car loan without your knowledge. Read your paperwork carefully.

Protect your car from expensive repairs with coverage that’s fair

One of the best ways to avoid expensive repairs and dishonest mechanics is to have breakdown coverage. At the right price and with the right conditions, you’ll save $1,000s and never have to worry about getting ripped off. You simply take your car to any repair shop and get back on the road in no-time without paying your repair bills out of pocket. has created vehicle breakdown coverage that is simple, trustworthy and affordable. Transforming the extended car warranty marketplace through technology and transparency, offers a full suite of worry-free, no-haggle car care plans through low-cost, 100% online, monthly subscriptions that drivers can sign up for in less than five minutes. Get an instant quote today!