How to protect yourself when selling a car

By Chad Lückhoff

The Car

It may sound silly, but you will physically need a car before you can sell it. Trying to sell a car that isn't in your possession or available to you, such as being locked away in storage or at a family member's residence, is going to make things very difficult.

You need to ensure that you are allowed to sell the vehicle as well. If your vehicle is financed through a bank you will need to make them aware of your intent.

Mechanically, the car needs to be as sound as possible. While ordinary wear and tear is accepted, major mechanical issues need to be addressed before putting the car up for sale. It's worth having the car inspected and an AA or Dekra report issued as this can be stated in the advert which will give prospective buyers additional peace of mind, helping you with the sale.

Paperwork

Possibly one of the most frustrating aspects of selling a car is ensuring that all the paperwork is in order and available for the prospective buyer. The buyer has the right to request to see the following documents and having these available will put the buyer's mind at ease and ensure that the process runs as smooth as possible.

The vehicle's registration, ensuring that the licensing is up to date and the vehicle is registered to the owner and on the eNatis system.

A roadworthy certificate. Roadworthy certificates are only valid for 21 days though and having the roadworthy status noted on the registration is sometimes not enough for the astute buyer.

Settlement letter from the bank. If the vehicle was financed through a bank, you may request a settlement letter if you do not have one or if there is still an amount owing on the vehicle, a letter stating the outstanding settlement amount. The buyer is entitled to see this letter.

Change of ownership papers. While this is the buyer's responsibility to ensure that ownership is transferred, having a signed copy of the paperwork will facilitate in the process.

A sales agreement. You have the right to request that the buyer signs a sales agreement, stating that you have sold the vehicle to them and that all fines from the date of the handover are for the buyer's account. It is worth noting known faults with the car as a signature from the buyer on this document will cover you should they demand a refund. A sale agreement letter can be drafted by a lawyer or alternatively, downloaded and modified accordingly, from the internet. This should include details of the vehicle (year, make, model, trim, colour), your details including name, ID number and contact details, the buyers details (can be completed later), any additional extras offered with the vehicle, including paperwork as well as the amount agreed upon (can be completed at time of sale)

Copies of your driver's license and ID.

The advert

This is an area where many of the unpleasant issues can be avoided. You have the right to advertise your vehicle by any means afforded you, be it online or otherwise, but ensure that there is consistency throughout ie: the same price, same details.

Be sure to include as much information as possible, including all the known faults and issues, including pictures if possible. Transparency and honesty here will assist you further down the selling road and will attract a more serious buyer.

Leave yourself a little bit of room for negotiation. Buyers will want to haggle on the price and being muscled into an amount that you are not prepared to sell for will make the experience unpleasant. Be reasonable though.

Price your vehicle accordingly, using tools such as our What's it Worth [link=https://www.autotrader.co.za/what-worth] tool to find out the market value of your vehicle. It goes without saying that you shouldn't price your car strictly according to your settlement value as this leaves no room for negotiation or may be too low.

Screening Calls

With your phone number out there, expect to receive a fair number of calls, not all related to the sale of the car. Prospective buyers will show genuine interest and ask at least a few questions. Assist them as best possible, without giving away too much personal information, particularly with regards to the storage habits and security of the car.

Ask the buyer questions to ascertain whether they are serious or not. What do they currently drive? What price range are they looking at? Have they owned a similar model before? All of these will give you a better idea as to whether someone is taking a chance or is serious about the vehicle.

Avoid text-based communications whenever possible. Call and speak to the person one-on-one.

The meetup

The car is yours until paid for in full with the funds reflecting in your account. As such, you have the right to decline a meeting in an area you are not comfortable with and you have every right to request that the vehicle is viewed at a location of your choosing.

Try to steer clear of opening your home up to prospective buyers and rather suggest a public meeting area. This should be a relatively busy public area, ideally with visible security and security cameras. Any serious buyer will understand and will do their best to accommodate.

Don't be in so much of a rush to sell that you take the car to the prospective buyer. This is the primary way of luring you out of your comfort zone where a shady negotiation, or worse, can transpire.

AutoTrader Marketplace [link=http://www.autotradermarketplace.co.za/] uses Bosch Service Centers as a neutral meeting point for buyers and sellers.

If possible, try not meet the buyer alone and have someone with you to oversee the proceedings.

The test drive

You have the right to deny the prospective buyer a test drive as well as request that the buyer present you with a copy of their valid driver's license.

It is not recommended that you allow the buyer to test drive the car alone, even if the buyer offers to leave their vehicle and keys behind – this vehicle may very well be stolen.

The test drive is the riskiest aspect of the selling process and care must be taken to avoid hi-jacking scenarios. You may request that there only be the two of you in the vehicle and that the buyer's guests remain behind. It is also advisable to have someone you know follow you in another car.

Stick to a route that you are comfortable with, in an area you know, do not venture into an area you do not know. The test drive can be kept relatively short and you have the right to end it at any time. Should you not feel comfortable with the way that your car is being driven (it is still your car until paid for in full), you can request that the buyer slow down or stop completely.

Money matters

This is another area where a lot of risks are present. As such, you should refuse cheques and should you be presented with a bank guaranteed check, it's best to contact the bank to confirm that the cheque is valid and legitimate.

Do not hand over the keys or papers until the money reflects in your account. Do not accept a Proof of Payment alone as these can be falsified. Do not let the vehicle leave your premises until payment has been received in full.

If the buyer is applying for finance, it is their responsibility to arrange this although some paperwork may be required from your side (proof of settlement, etc). Finance can take up to 10 days to be approved so be aware of this. It is not wise to “hold” the vehicle for this buyer and a first-come-first-serve basis should be communicated to this buyer.

The handover

Once again, it is advisable to meet in a public area to do the handover. Ensure that the vehicle is in the same, if not better, state as when it was test driven/viewed. Have the necessary documents ready, namely the yellow change of ownership form, copies of your ID and License, the sales agreement, the registration certificate, roadworthy certificate and any other documents pertaining to the vehicle. This includes the service book and owners manual. The new owner is also entitled to any spare keys available.

The new owner now has 21 days to get the vehicle transferred to their name.