
Physical cash has one big advantage: you get paid on the spot. No bounced checks, no waiting for funds to clear. But when selling a car, cash is a bit risky and awkward.
Selling to an old friend? Cash is a great way to get paid for your car. But for a $30k (or $50k, or $70k) car, cash becomes a big risk and a big hassle. We’ll explain why, and we’ll show you a better alternative.
Physical cash has a long history, and people feel comfortable with it—especially in smaller amounts. When selling your car, you might be tempted to accept cash because it feels safe and final. Once the bills are in your hands, there’s no waiting for funds to clear or worrying about chargebacks. You can take the money straight to your bank and deposit it.
Immediacy makes cash particularly appealing when you’re selling to someone you trust, such as a family member or friend. Cash also works well for low-value transactions—it doesn’t take much time or effort to count and verify a couple of thousand dollars. And if you need to complete the sale quickly, cash eliminates the waiting period that comes with many other car payment methods. But, the advantages of physical cash don’t carry over into high-dollar transactions.
When you’re selling an expensive vehicle, the speed and convenience of cash disappear.
When you accept physical cash for your car, you’ve got to get that money safely to your bank. That’s a vulnerable position to be in. While not common, criminals do pose as potential buyers to target sellers. They might hand over the cash, take your car, and have an accomplice rob you a few blocks away.
According to the Federal Reserve, one in every 10,000 notes are counterfeit. You need to carefully check each bill before completing the sale. Here’s how to verify:
If you’re uncertain about any bills, insist on meeting the potential buyer at their bank and having a banker verify the cash.
While cash is speedy for small transactions, it becomes slow and cumbersome for high-value items. You’ll need to:
When it comes to purchasing more valuable motorcycles, these everyday payment apps fall short.
Even if you decide the hassle is worth it, there’s another problem that cash and most other payment methods can’t solve.
During high-dollar car transactions, a catch-22 occurs. The buyer wants the title before they pay, and you want to be paid before signing over the title. Both positions are sensible, but they create an impasse.
This catch-22 is minor when the stakes are low. If you’re selling a 2001 Camry, neither party has much to lose. But for vehicles worth tens of thousands, you can’t risk signing over the title until you’ve been paid, and no buyer wants to hand over that much cash without assurance.
Some parties take the transaction to escrow. These services act as a trusted middleman, holding the buyer’s cash so you can sign over the car title knowing you’ll be paid. Escrow companies work, but they charge percentage-based fees that cut into both parties’ wallets. Plus, they require coordination and information sharing that add significant time to the transaction. You don’t need an escrow service to sell your car; there is another option.
A bill of sale is a legally binding document that protects both parties. Should the buyer be up to no good, you have a document that will hold up in court. This creates enough security that buyers feel comfortable paying you before you sign over the title.
A bill of sale records the transaction terms. Most states have official bills of sale with these fields:
You can print off two copies of your state’s official bill of sale (or use a generic template if your state doesn’t provide one). Before exchanging money or title, you and the buyer can fill out two copies, sign, and countersign.
However, printed bills of sale have two edge-case complications you might encounter:
A digital bill of sale—stored in the cloud, signed and countersigned under both parties’ verified identities—overcomes these vulnerabilities.
DealNow provides an in-app digital bill of sale that can’t be stolen or tampered with. This creates a trust bridge between you and your buyer. You both electronically sign the bill of sale on our mobile app.
Because DealNow verifies both parties’ identities, you know you have the buyer’s legal name and signature on the document. Our optional title check service (one-click order from your DealNow dashboard) reassures buyers they’re dealing with the legal owner of the vehicle and a clean title via cross-referencing DMV records.
Here’s how easy DealNow makes selling your car:
After the sale, you retain access to your digital bill of sale from your DealNow account, and the buyer can print it to file with their DMV.
DealNow streamlines private car sales (as well as boats, RVs, and other vehicles). We designed the DealNow app to offer the upsides of cash and other payment methods with the cutting-edge technology needed to sidestep the downsides.
Here’s how DealNow beats physical cash and streamlines the selling process:
DealNow is as sure as a briefcase of verified hundred-dollar bills, without the risk and inconvenience.
If you must accept cash, never meet at your home or in a secluded location. Meet at your bank, where you can:
Remember that large cash deposits may trigger bank reporting requirements. Be prepared to explain the source of funds to your bank.
The safest payment method when selling your car is DealNow. Unlike physical currency (which can be stolen) or checks (which can bounce or be forged), DealNow facilitates instant, verified transfers of any amount directly to your account.
DealNow’s platform secures your transaction by:
With DealNow, you get the immediacy of cash with bank-level security. Your funds are held in an FDIC-insured account with easy offboarding to your regular bank.
While physical cash sales have some risks, other payment methods are much worse. Avoid these payment methods:
Physical cash is better than these payment options, but it’s still inconvenient and risky. DealNow lets buyers send you instant digital cash, safely and securely.
You don’t need an escrow service to sell a car. Escrow services solve trust problems in private-party transactions, but they’re expensive. They generally charge percentage-based fees that eat into your profits. They also add time and complexity because now you’re coordinating with a third party.
DealNow gives you self-serve, instant technology. No coordinating with a third party, no waiting, and no percentage-based fees. It’s escrow-like safeguards in the palm of your hand.
If your prospective buyer wants to pay cash, protect yourself by doing the following:
Better yet, suggest DealNow as a safer alternative. It gives private buyers the immediacy of cash and a host of features to help them assess your vehicle.
Federal Reserve Bank. (n.d.). FRB: The Use and Counterfeiting of United States Currency Abroad, Part 3. Federal Reserve Board. Retrieved September 6, 2024, from https://www.federalreserve.gov/boarddocs/rptcongress/counterfeit/default.htm
DealNow is the easiest way to close your own vehicle deal, anytime. It’s the safe and simple way to avoid fraud, sign documents, and instantly transact, all in one app.