When buying or selling a used car privately, transferring money is often the most challenging part of the whole transaction. Almost every form of payment has drawbacks.

The challenge: most payment options entail one or more of the following characteristics:

  1. Risky
  2. Untenable for large transactions (volume limits on transfers)
  3. Slow

The right payment method should offer convenience, security, and financial protection between buyer and seller.

Let’s evaluate the top 4 payment options to see how secure, convenient, and safe they are.

Quick links:

Is cash the best form of payment?

Is a cashier’s check good?

How about Venmo?

Is wire transfer safe?

What is PrivateAuto Pay?

How do I avoid fraud?

How can I sell my car on PrivateAuto?

1) Cash is King…or Is It?

Most people like to accept cash as a form of payment. The chances of it being counterfeit are low, thus many sellers feel safe accepting cash for vehicle transactions.

While getting cash in hand can feel like a sure thing, many sellers feel uncomfortable going to meet the buyer who has a sum of cash on their person, especially where large sums are involved. After all, how do you know they won’t take back the cash after you hand over the paperwork?

From a buyer’s perspective, it can also be dangerous to walk around with a large amount of cash; for this reason, many buyers may feel uncomfortable using cash for larger transactions.

PrivateAuto offers the immediacy of a cash payment without the risk. Our PrivateAuto Pay feature is a full banking integration; when the buyer authorizes the funds transfer through our app, money instantly moves from their PrivateAuto account into yours—24 hours a day, 365 days a year.

For large transactions, cash becomes particularly problematic. While a cash transaction of $4,000 is no big deal, there are few safe ways to accept $100,000 in bills from a stranger. With PrivateAuto Pay, you can send and receive for your vehicle up to $1 million instantly with no fees.

Advantage of Cash Payments

The main advantage of cash is that it is very difficult to counterfeit. There are some easy ways to tell if cash is genuine, so review the safety features on bills before accepting a large amount of cash. You should also take the time to personally count out every bill.

Disadvantages of Cash Payments

If you’ve ever felt conspicuous carrying a large sum of money, you understand one of the greatest disadvantages of sending and receiving cash. A wad of bills in your pocket or in your vehicle is a prime target for theft. Try to minimize this disadvantage by asking the potential buyer or seller to meet in a safe space, such as a parking lot.

Another disadvantage of cash is that it limits your pool of buyers. Many buyers are unable or uninterested in withdrawing a large amount of cash for a used vehicle. If you want a quick sale at the highest possible price, then you may want to consider accepting other safe forms of payment.

2) A Cashier's Check is No Guarantee

Many sellers prefer a cashier's check for payment when selling used cars. A cashier’s check is more certain than a personal check. However, unless you’re standing in the issuing bank during business hours and they verify the funds, this payment method is not free of risk. Criminals have forged counterfeit cashier's checks to con sellers in the past. So, while a cashier’s check is a fairly safe method of transferring funds, it’s not foolproof.

To be absolutely certain a cashier’s check is valid, some sellers wait for it to clear their bank before they release the title to the buyer. This puts a lot of pressure on the buyer, since they have to pay a potentially large sum and trust the seller to sign over the car. It also means that the buyer and seller will need to meet a second time, which is not exactly convenient.

PrivateAuto offers a safe, instantaneous, and guaranteed payment method. With PrivateAuto Pay, unlike a cashier’s check, funds instantly appear in the seller’s account, and the entire transaction can be concluded when the buyer and seller meet for a test drive.

3) Peer-to-Peer Cash Sharing Apps Have Their Disadvantages

Peer-to-peer money sharing apps, such as CashApp and Venmo, are great for small transactions. For large dollar amounts, they’re not so great. You'll want to find another method of payment for a car transaction.

With a weekly limit of $5000, Venmo and Cash App just won’t cut it for buying and selling a $50,000 vehicle. PrivateAuto Pay is just as quick and secure as peer-to-peer cash apps, and has a $1 million transfer limit. Like Venmo, PrivateAuto Pay is free to use.

4) Wire Transfers are Fairly Secure

Another common choice for reducing financial risk is the wire transfer or bank transfer. Bank transfers do not require buyers and sellers to meet in-person, as they are a transaction between two financial institutions.

The advantage of a bank transfer is that funds are guaranteed by the bank, making this a fairly safe payment option. The disadvantages are twofold.

  1. The seller needs to provide banking details to a purported buyer, opening themself up to potential risk of financial harm.
  2. A wire transfer is often not instantaneous and requires a coordinated effort between four parties: two financial institutions, the buyer, and the seller. If the transaction occurs after banking hours, on a holiday, or on a weekend, the seller may need to wait a considerable time before receiving the money.

PrivateAuto Pay, in contrast, transfers funds instantaneously from buyer to seller, any time of day, any day of the year. Buyer and seller do not need to call the bank; nor do they need to exchange contact information or banking information. Additionally, sellers don’t need to wonder if a would-be buyer has sufficient funds, as they can opt to deal only with those who have their funding verified.

5) PrivateAuto Pay for Security and Convenience

With our integrated banking feature, PrivateAuto Pay, PrivateAuto offers the best of all worlds. We are the only safe, instantaneous, convenient, and contactless payment option for a used car transaction over $5,000.

When it comes to selling and receiving payment for your car, the benefits of PrivateAuto Pay include:

  • Instantaneous payment from the buyer’s PrivateAuto Pay account to yours, 24//7/365
  • Transfers of up to $1 million dollars
  • No exchange of contact information or banking info
  • Contactless payment reduces the spread of infectious disease
  • Transferring funds from your PrivateAuto Pay account to your bank account is easy
  • Verified funds keeps you from dealing with buyers who can’t afford your car
  • Encrypted personal info protects you from hackers
  • Peace of mind knowing that you will get your money immediately and with no coordinating required
  • Conclude the entire transaction when you meet the buyer for the test drive

Private Auto allows you to sell your used car quickly and safely. Or you can buy a car easily from a private seller. Protect yourself by choosing a secure, instantaneous, and convenient online platform.

How to Avoid Fraud when Selling a Car

Unfortunately, fraud concerns come with the territory when selling your car privately. There are many scams out there, but the right technology helps you fight back and not fall victim. PrivateAuto offers a great way to buy and sell a used vehicle without risking theft, forged personal checks, or other fraudulent activity.

Take Your Time when Selling a Vehicle Privately

Don’t let a buyer rush you into taking a low offer or accepting payment without verifying it. If your buyer gives you a now-or-never ultimatum and you feel rushed, it’s probably best to walk away. If you advertise your car well, there should be a long line of buyers ready to make similar offers without putting too much pressure on you.

Transfer Your Vehicle Title Once the Payment is Completed

Wait to transfer the title until you’ve confirmed payment. The last thing you want is to have a scam buyer drive away with your vehicle, title, and cash.

A bill of sale is required in some states, but it is a good idea to sign one in most private sales situations, as it gives you written evidence of the transaction and the agreed-upon sale amount in case there’s a dispute later on.

PrivateAuto automates the bill of sale by giving you an official bill of sale for your state. Buyer and seller sign it inside their PrivateAuto mobile app, and it stays there in your account for reference. If there’s ever a question of the sale’s legitimacy, you have this document to refer to.

To learn more, read our complete guide to the bill of sale and why it matters.

PrivateAuto is one safe online location to manage signing over your title safely. It’s important to only take this step once you’re ready to let go of your vehicle, so discuss all the other paperwork and confirm your payment first.

If you want to learn more about vehicle titles, check out our detailed car title guide.

Buy or sell a Car Through PrivateAuto

Complete the sales process easily and legally with the help of PrivateAuto. Our technology-driven platform helps you find verified buyers and sellers, sign documents online, and receive state-specific steps to complete the sale, while our integrated payment system and financing allow you to get funded and accept payments in a secure and convenient manner. Get started with selling your car on PrivateAuto today.

Interested in buying a used car? Browse used cars for sale by owner to find the ride of your dreams.

FAQ on Safe Money Transfers

Why are private vehicle sales better?

You can sell your used car to a private individual and make more money on the sale. Car dealers can offer you a trade-in value or instant cash offer, but these are almost never as much as you can make in a private sale. Whether you’re selling the latest luxury vehicle or an old car with maintenance issues, you’ll almost always earn more in private sales.

Buying a used vehicle from a private party also has some benefits. Dealers not only charge dealer fees but they can be pushy and difficult to negotiate with. Whereas, an individual may be more flexible on pricing or more friendly when discussing the details of the vehicle. Because a private seller is often the individual who drove the car frequently, this seller may know more about the vehicle than a dealer.

Does PrivateAuto offer payment plans?

PrivateAuto does offer in-app financing options via a third party lending partner. You can apply for financing within our app. If approved, the lender pays the seller in full while you make your monthly car payment to the third party lender according to the terms of the loan.

When do I sign over the car title?

When selling a car via PrivateAuto, you and the buyer will follow our prompted step-by-step process. With each of you using the PrivateAuto app, we guide you through signing the bill of sale, transferring funds, and signing over the car title. See our article on transferring a car title for more details on the process.

Is Venmo safe for selling a car?

For large transactions, Venmo is not the best way to accept payment when selling your car.

Venmo has a weekly person-to-person spending limit of $4,999. So, if you’re selling your used car for $5,000 or more, you’ll want to find a better route. PrivateAuto Pay offers an instantaneous, safe, and secure way to accept payments of any amount.

How do you avoid getting scammed when selling a car?

To avoid getting scammed when selling your used car, we recommend the following practices:

  1. Don’t give out your contact information
  2. Deal with verified buyers only
  3. Verify that the buyer has the funds to purchase your car
  4. Receive payment through PrivateAuto Pay

What is the safest way to receive money when selling a car?

PrivateAuto Pay is the safest and most convenient way to receive money when selling your used car. With no exchange of contact or banking info, an intuitive interface, and immediate contactless payment up to any amount, we are unlike anything else in the used vehicle marketplace.

How does PrivateAuto help me manage offers when I sell my car?

Online listing services can quickly drum up a lot of interest and have your inbox full of offers, information requests, and requests for test drives. Here are a few ways you can manage multiple offers on PrivateAuto:

  • Accept, reject, or counter individual offers.
  • Schedule meet-up times.
  • Recommend locations and times for test drives.
  • Link listings on multiple sites to the PrivateAuto platform.

All of this communication occurs through the PrivateAuto app, rather than your personal email or phone number. This feature of the app protects your personal information.

Linking listings from multiple sites allows you to communicate with every prospective buyer on the same convenient platform. This helps you manage offers and respond to them individually to avoid confusion. Receive the best price for your used vehicle by negotiating multiple offers at once.

How does PrivateAuto vet buyers and sellers?

Both buyers and sellers get verified using the latest facial recognition technology to create a safe experience. Buyers must provide drivers license information, an email address, and a phone number. This personal information is hidden from other buyers and sellers and is only used to verify the user's identity.

Sellers must enter the VIN for the vehicle and create a profile before listing. A VIN is critical to investigating the ownership of a vehicle and determining whether the title is clean. Buyers and sellers can enjoy peace of mind on PrivateAuto knowing that both parties have been thoroughly vetted.

Does PrivateAuto provide the necessary paperwork for a successful transfer of ownership?

Yes, PrivateAuto has all the paperwork you need to sell your car in every state. Each state requires different paperwork to legally transfer titles and sell vehicles to a private party. Many states require a bill of sale. Some states have their own specific forms that are required to buy or sell a vehicle in the state.

PrivateAuto manages all these forms and makes them available for both buyers and sellers to electronically sign. The entire process is only accessible by the buyer and seller, which prevents the risk of identity theft. It can be difficult to keep up with state-specific laws, particularly if you’ve moved states recently, so use PrivateAuto to ensure a smooth and legal transaction.

How secure is the PrivateAuto Pay feature?

Typical private-party used car sales require handling a large amount of cash or processing a cashier’s check.

Cash can be stolen, and cashier’s checks can be falsified. Cashier’s checks may appear legitimate, even after being deposited, only to be exposed weeks later after you’ve already signed over your vehicle.

Direct banking is a safer alternative to give both parties peace of mind.

PrivateAuto Pay is a direct banking integration that ensures payments are safely transferred without the risks associated with cash or cashier’s check sales. Payment information is also hidden from the seller, so a buyer doesn’t need to be concerned with bank information theft.

Do I need an escrow service when selling my car privately?

If you have a valuable used vehicle and are selling it yourself, a legitimate escrow service can help the transaction go smoothly.

PrivateAuto Pay gives you all the advantages of an escrow service. Where escrow services charge exorbitant fees, PrivateAuto Pay is free.

Read how PrivateAuto Pay enables remote vehicle transactions to learn more about how it renders escrow obsolete.

What is the safest way to transfer money when buying a vehicle privately?

Cash and cashier’s checks can be fairly safe payment methods, but even they aren’t airtight. The safest method of payment when buying a new vehicle privately is PrivateAuto Pay. Our payment integration is the only way to send instantaneous transfers over $5,000 with no exchange of personal or financial information. Since the payment is available to the seller as soon as you send it, you’ll be able to take possession of the vehicle when you meet for the test drive, minimizing the risk of fraud on the seller’s end.