escrow services / buying a car
 

Hey all,

I'm interested in possibly purchasing a car from a wholesale dealer here in the virginia/DC area. He basically picks up vehicles from auctions and resells them.

The catch - he's asking for a deposit up front since he'll be at risk if he purchases a vehicle and I decide not to buy it.

Obviously, potential scam alerts are going off in my head, but he does seem fairly legitimate.

What would be the best way to protect myself? An escrow service? (Something like escrow a $500-$1000 deposit on the condition that a car purchase is made, etc?)

Actually, the escrow money could be transferred to him for an option contract to purchase the vehicle - anyone know the proper way to do this?

Any other ideas appreciated.

Re: escrow services / buying a car
 

The basic conditions I'm trying to cover are this:

1. if he purchases a vehicle, I have the right to buy it
2. if I decide not to buy the vehicle, he can keep the deposit
3. if he is unable to purchase a vehicle in a set time frame, I would receive the deposit back

Anything else I should cover?

This seems to be a pretty basic option contract, with the exception of that 3rd point. Also though, I'd be a little worried about signing an option contract with some unknown guy - should I bother to use an escrow service?

Re: escrow services / buying a car
 

fwiw, i used www.escrow.com for a high-value domain name sale and it worked very well.

Re: escrow services / buying a car
 

sounds pretty well mapped out (re: your basic conditions) which I think makes this an easy "escrow" situation. good link - and it appears IMO to provide a decent price on "peace of mind" (~$35fee for a $1k escrow)

couple of questions...just curious
1. you say this guy is a stranger, but how strange? is he a friend of a friend or is this some sort of small time gig he's running? how did you come across him and his services.

2. how specific are the guidelines that you are providing to the wholesale-dealer? Is there a book w/ everything being auctioned and you are picking out a few and telling the dealer to go for them?

3. what's the price range of the vehicle you are looking at? Just wanna gage the percentage of the earnest monies. from what I've gathered, real-estate is typically around 1% of purchase price under normal conditions.

Re: escrow services / buying a car
 

This is one of the most popular scams listed on Craig's list. I would do some background if that is how you found the opportunity.