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Getting the Money for Your Used Car

By: Scott McBride - Updated: 15 Oct 2010 | comments*Discuss
Getting The Money For Your Used Car

In many ways, selling a used car is the easy part. What can be trickier is getting hold of the money once the deal has been struck. Obviously, there should not be a problem if the buyer is someone the seller knows and trusts, but in the vast majority of cases the car will be sold to a complete stranger.

Once a price has been agreed there are several ways to complete the transaction and there are pros and cons for each. The old ways are often the best and cash is the easiest and quickest form of payment. Many used cars change hands for cash, but it tends to be those at the bottom end of the market.

While it is fine accepting a few hundred pounds for an old Fiat Panda, cash is not ideal for those selling a nearly new BMW M5 for many thousands of pounds. When being paid in cash be sure to count it very carefully and check that every note is genuine. Those not confident enough to check notes themselves should go to a bank. A genuine buyer will understand and will not mind the delay.

Wait for the Cheque to Clear

A personal cheque is the next most popular way to pay for a used car. This is fine as long as a seller insists on keeping the car until the cheque has cleared and the money is tucked away safe and sound in his bank account. It will take a few days for a cheque to clear, but a genuine buyer will understand this and use the time to sort out insurance.

Whatever a buyer says, a seller should not be suckered into releasing the car until the cheque has cleared. Remember that most buyers will be complete strangers, so do not trust a handshake or a reassuring smile as proof that the cheque will clear. Release the car too early and the cheque might bounce and the seller will be left with no car, no money and very little chance of retrieving either.

A banker’s draft is similar to a personal cheque with one very significant difference – the banker’s draft is guaranteed to clear by the bank. It makes the banker’s draft a safer option, but make sure the buyer does not have a counterfeit draft.

Bankers Draft, the Real Deal

If the buyer offers to pay by banker’s draft, it is a good idea to accompany them to the bank and ensure the draft is a real one issued by a bank, and not one printed off at home. Better still, a seller should take the banker’s draft to his own bank and make sure the money has cleared in his bank account before releasing the car.

Online Buying, Cash Transfer

Online banking has seen an increase in the number of used cars bought by cash transfer. This can be one of the quickest and safest ways to complete a transaction, as a buyer can pay over the internet as long as he has the seller’s bank account number and sort code.

Never give out any passwords, security information or pin numbers to a buyer. The only information a buyer needs to complete a cash transfer is a bank account number and the associated sort code. Any buyer who claims to need further information is lying and should be avoided. If wary of releasing bank account details, a seller should contact his bank for advice.

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