Private car sales in San Francisco: get paid before the title changes hands

Before you list: title, smog and tolls

Have the California title in your hand before you post an ad. For a private sale, the DMV's title page puts it in one line: the seller signs the title, and the buyer submits it to the DMV. If the title is lost, the DMV says you must complete REG 227, the Application for Replacement or Transfer of Title, first. If a lender is still on the title, read title problems before you take calls from buyers.

Get the smog certificate early. The DMV's smog page puts the certificate on you, the seller, and wants it in the buyer's hands at the sale. A car less than four years old is spared the inspection, and its new owner pays a smog transfer fee in its place. The exemptions and where to test in the city are on the smog check page.

Golden Gate Bridge tolls follow the plate. When no toll tag is detected, the bridge FAQ says, the plate is matched to an account, or a toll invoice is mailed to the registered owner. It also warns, about a rental car's plate added to a FasTrak account, that "if you forget to remove the plate number from your account, you will be charged additional tolls" when someone uses that vehicle at other Bay Area toll facilities. A sold car's plate left on your account carries the same risk. Take your toll tag off the windshield and delete the plate before a stranger drives the car away.

Clear out anything that carries your name, address or account numbers. DFPI, the state's financial regulator, warns that scammers want personal information to steal identities.

Source: DMV: title transfers and changes; DMV: smog inspections; Golden Gate Bridge: tolls and payment FAQs; DFPI: six layers of protection from scams.

Meeting buyers and test drives in the city

None of the SFPD's safety-tip pages covers private car sales or test drives, so this page names no meeting spot. What the SFPD does publish is general advice for being out with valuables: shop with a friend when you can, above all after dark, and keep your keys in your hand as you walk to your car. Both carry over to showing a car to someone you met online.

Ask for the buyer's full name and driver's license before anyone drives. The state Bill of Sale, REG 135, has lines for the buyer's printed name and mailing address, and the online release of liability asks for the new owner's name and address. A buyer who will not show a license before a test drive is unlikely to give you a true name for those forms.

Keep your phone in your own hand. San Francisco's StopScams SF tracker describes a stranger who asks to borrow your phone and, while holding it unlocked, sends money through Venmo to someone else. It calls your phone a digital wallet, never to be handed to a stranger.

Source: SFPD: safe shopper tips; DMV: Bill of Sale (REG 135); DMV: Notice of Transfer and Release of Liability; SF Treasurer: StopScams SF scam tracker.

Checks, money orders and the overpayment trick

California's Attorney General describes the overpayment scam from the seller's side. A fake buyer sends a money order for more than the price, the bank accepts it at first, the seller refunds the extra, and then the bank finds the fraud and reverses the whole amount. The AG's advice to sellers: "For sellers, beware of buyers overpaying for goods with a check or money order and then asking for refunds."

• Take the exact price and nothing more.
• Verify a check with the bank it is drawn on. DFPI's rule is to verify information by going directly to the source, and for a bank, to look up the number on the bank's official website. Do not use a phone number or link the buyer sends you.
• Refuse payment links from the buyer. StopScams SF warns that fake checkout pages steal card and personal details, and tells sellers to open Zelle, PayPal or the bank app on their own.
• Send the buyer nothing. StopScams SF lists a demand that you pay by gift card, cryptocurrency or wire transfer as a red flag.

Source: California Attorney General: online purchases; DFPI: six layers of protection from scams; SF Treasurer: StopScams SF scam tracker; SF Treasurer: StopScams SF.

Escrow sites, shippers and buyers you never meet

DFPI, which licenses California escrow companies, describes how sellers lose goods to fake ones. A scammer poses as a buyer, names an escrow company, and the seller gets an email saying the payment has arrived. The seller ships to the address given, which DFPI says is often a hotel lobby or a mailbox rental store, and is never paid.

The tell is who picks the company. In DFPI's words: "A buyer or seller who insists on using a particular online escrow company is probably trying to steer you towards a fraudulent escrow services site." Fake sites often claim a DFPI license, copy a real licensee's number and display trust logos. Legitimate escrow companies do not move money by Western Union or MoneyGram.

To check a company, call DFPI toll-free at 1-866-275-2677. For a car, a plainer rule works: if the buyer cannot come to see the car and pay in person, do not ship it or release it to a transport agent first.

Source: DFPI: online escrow fraud questions and answers; DFPI: 10 tips to avoid online escrow fraud.

The handover in the right order

1. Funds confirmed. Your bank, reached on a number you looked up, confirms the payment.
2. Title signed. You sign the seller's line. The DMV page says the buyer submits the title, and that any change in ownership must be reported to the DMV within 10 days.
3. Bill of sale. Fill in REG 135 with the vehicle details, both names, the date and the selling price. The seller signs under penalty of perjury. Keep the form's second copy, marked to cut and save for your records.
4. Smog certificate and keys. Hand over the certificate with the keys, last.
5. Release of liability, before the day ends. The law gives you 5 calendar days, and the DMV says an online filing updates the record within 1 business day. You need the new owner's name and address, the plate, the last five digits of the VIN and the odometer reading. Save the confirmation. Details are on the release of liability page.

The release protects you; it does not end your ownership on the record. On the DMV's record you stay the owner until the buyer files a transfer application with the title you signed; the DMV says only that filing removes your name.

Source: DMV: title transfers and changes; DMV: Bill of Sale (REG 135); DMV: Notice of Transfer and Release of Liability.

If a check bounces or a buyer was a scammer

Stop contact and send no money. StopScams SF says to call your bank or payment processor right away, to call the SFPD non-emergency line at (415) 553-0123 or visit a station, and to file federal reports at ReportFraud.ftc.gov or IC3.gov. The SFPD also says a crime that happened over the internet should be reported to the FBI's IC3.

For a check returned for insufficient funds or a closed account, the SFPD points you to the District Attorney's Bad Check Enforcement Unit, 350 Rhode Island St, 400N, at 1-628-652-4028. The Attorney General says forging a check or writing a fake one is a crime. You may also sue the writer of a bad check and recover three times its amount, up to $1,500, if you first send a demand letter by certified mail and are not paid within 30 days. Claims of $10,000 or less go to small claims court, and the SFPD notes that the San Francisco Small Claims court runs free sessions.

Watch for fake tickets after the sale. The StopScams SF tracker says the SFMTA notifies owners of parking violations by mail, never by text with a payment link. More on tolls and tickets is in after you sell.

Source: SF Treasurer: StopScams SF; SFPD: financial crimes; California Attorney General: bad checks; SF Treasurer: StopScams SF scam tracker.

Before the buyer shows up

Print the California seller paperwork list and keep it with the title. If you would rather not screen strangers at all, read how the instant offer works: the partner buyer's driver looks the car over at pickup and pays by check. Questions? Call (628) 333-6040.