Flipping cars for fun and profit
The No Limits Ladies have posted an article on how to flip cars — how to buy used cars for cheap and sell them again for a profit.
I find used vehicles for sale, often times through Cars.com, and I price them using KBB.com. When I find one that I know is in more demand, with a motivated seller at or below private party pricing, I go look at it and sometimes buy it. Then I drive it for a while for free, and sell it when I’m ready, for more than I bought it for. Then I roll that money into the next vehicle, or sometimes keep a bit for myself.
According to the article, the steps to flipping a car are:
- Screen used car ads for in-demand cars priced below market.
- Make a cash offer for below the asking price.
- Make necessary repairs.
- Get the car cleaned and detailed.
- Have the title free and clear, ready to hand to the buyer.
- Show the vehicle in a safe location.
- Don’t negotiate — you don’t need to sell the vehicle, so wait for your price.
- Accept only cash.
This doesn’t interest me — I’m not a car guy — but if you’re mechanically inclined, this could be a great way to make some extra cash.
[No Limits Ladies: More Money Mondays: Flipping Cars]
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There are 143 comments to "Flipping cars for fun and profit".
Every day you have a car, it loses value, making cars are the worst investments we all have to make. I’d say flipping cars is just about the riskiest thing I’ve heard of for trying to make a buck. I would bet half the time you buy “in demand” cars, you’d have trouble selling them above what you paid.
honestly. i bought an “in demand” subaru wrx for cash traded it straight across for a car i sold for 14,500 cash made 8000 in 2 weeks. thing is……you MUST know values and be mechanically inclined,,VERY, other than that youre wasting your time lol..
Every business is risky, if it was that easy everybody would do it. Don’t listen to the people that are NOT in he business and listen to the successful ones. Blackberry was on top 3 years ago and investing on them was a no brainer, but them the iPhone came out. I flip cars and make a really good living. I quit my $26/hour job and started flipping cars full time last summer and make more $$$ now. Just to your research and knew your market in your city.
I only sell 4 door imports, about 10 years old and make about $1200 on each car. I buy my cars from locals (kijiji) and buy the cars that people need gone ASAP.
Hello cris and thanks for the info.I just need to know how many cars can you sell before getting in trouble with icbc?
When buying and selling vehicles for profit, is it necessary that I get temp. plates and pay all of the transfer and registration fees if I plan on flipping the car as quickly as possible?
Any info would help. Thanks.
Hello,I liked your story and willing to do it but i have no idea how to do it.
Please let me know if I need to put it under my name ,Get insurance ,pay taxes?
As you know by adding all these expenses ,markup would not be as high.
Please let me know?
thank you in advance
Could not be more wrong.
1) Cars do not always depreciate. They can become collectors items and, if maintained properly, They appreciate way more than they were initially worth. Yes the immediate depreciation is great but you’ve made quite the radical generalization when saying they all lose value.
2) Yes it is a risky investment IF you don’t know what you’re doing. All investments require due diligence. If you just pick and choose at random which car you think will make money, then you are taking a HUGE risk, but you wouldn’t go doing that with any other investment would you?
3) It’s extremely rare for a new car to be in such demand that someone would pay more than the car was purchased for, that’s because new cars are NOT in demand. It’s basic Supply and Demand. Econ 101! Come on man! High demand cars are usually
4) Turning around a car does not mean you find a car at below market value and directly sell it at market value or higher the next day. In very rare cases will you find this but it probably means the car is stolen. Usually when turning around cars you find one that has something wrong with it, fix it yourself to cut repair costs, and sell it in perfect working order, but with a salvage title most of the time. You can make a decent amount of return in a short amount of time here, which I guess goes against the title of this website, but hey! It’s still making money. Most of the cars I’ve ever turned around can be sold at a 20%-35% return on investment; all bought post-accident and with salvage titles on them. You’d be surprised at how little a difference it makes to many buyers. The car I drive now is a salvage title rebuild. Runs with less issues than my buddy’s car who has the same model and year, but bought brand new.
This is the biggest bunch of crap I ever read. This guy probably tried to flip a car and failed miserably. Every car I’ve bought with the intention to sell for profit has made me profit.
You have to know what you’re doing, what to look for, how to value the car, how to check vehicle history (that’s easy Carfax), and how to make offers and persuade the seller to take your offer.
In fact, most of the time I buy the car on Craigslist, then go and sell it for more right on Craigslist again. I just sold a Sentra I bought for $1500 and got $2200 for it a week later. It took me less than 3 days from time of listing to sell it.
The trick is to only buy and sell cars you would be comfortable letting your wife, daughter, or mother drive because Karma is a bitch and you don’t want to screw anyone over.
The other secret is to NEVER EVER buy a car to flip from someone who is already flipping. Trust me you don’t want their sloppy seconds. There’s a very strong chance they don’t have the same ethics as you and could care less about the condition of the car and only cares about profit.
Look, profit is the name of the game, but I don’t want to sell a piece of shit to someone who doesn’t know any better. I’ve had it happen to me a long time ago and I felt horrible.
If you click my name, it should take you to a channel I put together to help people who want to learn how to flip cars. One of the videos shows how to EASILY spot a car flipper so you don’t buy the car from them and get their sloppy seconds. It’s real simple, but I bet you didn’t know this little trick to knowing.
Go check it out and don’t pay attention to Matt because he doesn’t know what he’s talking about.
You CAN profit from buying and selling cars online and on craigslist. You just need to know what you’re doing 🙂
I earn a profit every time without fail.
– Jay
Hi Jay.
I just read your response.
I am interested in starting to flip cars, I am not that afraid of not getting much money, but my concern is: Do I have to register for that , get a license, pay taxes or somethin llike that?
Thank you Jay
Martin
This guy Matt at the top doesnt know what he’s talking about.
Every car I’ve ever flipped I’ve profited from. You just gotta know what you’re doing.
Here’s a couple of tips:
1. Don’t ever buy a car to flip that you wouldn’t feel comfortable letting your wife, daughter, or mother drive.
2. Always always always get the VIN # so you can get a vehicle history report BEFORE you go look at the car. This way you won’t be flying blind and you can even save yourself the ride. This is the best $45 you’ll ever spend.
3. Don’t buy a car you plan on selling for profit from someone else who is doing the same thing. lol You don’t want their sloppy 2nds and there is a great chance they don’t follow tip #1. Always buy from a real owner. It’s easy to tell the difference if you know how. If you’re not sure click on my name. I posted a video showing how to spot a car flipper every time within seconds.
You can make money flipping cars. I don’t do it full time, but my goal is to move 1 or 2 cars a month. It’s cash and it pays bills.
Sell one car a month and you can end up earning $5K – 10K extra cash IN YOUR POCKET per year. And this is being conservative.
Good luck!!
Jay, I here what you say and think you are right. I have a question about the flipping process. Each state is prob diff with respect to buying and selling, however, can you buy a car and not pay sales tax and then resell it? Is there any way to temporarily insure it so your prospective buyer can drive an insured vehicle? Just curious. Here in Mass, it seems as if this is hard to do without a used car dealers license, and that kind of license requires a physical business location with signage, etc. Is it different where you are located? Thanks for your comments.
Eric
If you don’t want to deal with the hassle of getting a dealer’s license, the only 2 options are as follows:
1. You transfer the title in your name and pay sales tax. Pay to get it insured and pay the registration fee as well – thus eating into your profits a lot more.
2. You don’t sign the buyer portion of the title, don’t go to DMV, but you just sell it that way. Much faster, but much riskier. This is known as title jumping. As far as the insurance goes, this is much riskier as you won’t have any insurance on the car. Most people, whether they’ll admit it or not, do it this way.
Obviously do what you feel most comfortable with. The dealer’s license is the safest, but unless you’re moving 2 cars or more per month, it will suck up all your profits making it a pointless endeavor.
#1 is also safer too, but I don’t know how long it takes for Mass DMV to send title issued in your name to you. In NY it’s 6 – 8 weeks which is a very long time to sit on a car you’re only making $500 – $1000 profit on.
Hope this helps,
Jay
I dont agree with you, simply because I have been doing it for over a year now, I have been able to support my family and taken 3 vacations in a year, I’m my own boss, its true there is better seasons than others but, FOR SURE it is very profitable, maybe not for everybody, i’m not even a mechanic but I know how to deal with people and I learn everyday.
TITLE JUMPING IS FRAUD, PLAIN AND SIMPLE!
Please show how it’s fraud, do you even know what fraud is? It may be illegal because the Government doesn’t like getting cut out of the share they feel they are entitled too for your hard work, but fraud it isn’t.
IT’S NOT FRAUD!! hahahaha
Felt like yelling back in all caps – lol
Anyways, if it’s such fraud, how come you don’t hear about people being thrown in prison for buying and selling used cars?
Maybe, if they sell more than the state allows per year, they may get a fine – if they get caught.
I think the term FRAUD is a bit blown out of proportion.
Anyways, if you want to see how I legally made $1575 flipping a car I didn’t even own, click on my name to see the youtube video I made 🙂
It is fraud because it is implying that the vehicle is being purchased from the previous owner instead of you. That is clearly misrepresenting the facts of the sale for a profit.
fraud
1.
deceit, trickery, sharp practice, or breach of confidence, perpetrated for profit or to gain some unfair or dishonest advantage.
This should be a lesson to never sell a car to an accountant. Wait for the right customer who falls in love with the car your selling; they will pay close to your asking price. This strategy works for me.
Here are the facts about flipping cars.
It pays pretty well if you A) Know what to look for.
B) Know how to negotiate based on the cars “street value” which is always lower then the KBB value.
And C) are mechanically inclined.
I have never, ever, ever, lost money on a car.
Worst case was to get back exactly what I had into it.
I own a restoration/ Body shop in AZ. I have a few clients I restore cars for. In between their cars I buy and sell my own. Mostly 80’s European cars. I generally pick them up for 700-1200. I do whatever necessary mechanical work, Body work is done as needed. Sometimes a full paint job, sometimes a panel or two. I try and keep it to the bare minimum but want the car to look as nice as possible.
I Have a great inexpensive upholstery shop that covers the seats for a few hundred bucks, I search Craigs List for as many parts as possible. Including wheels and tires. I have gotten sets that were 12-1500 new for as little as 400. It adds great value to the car and helps it sell faster.
As an example: I bought a 91 VW Cabriolet for 1000. Brand new engine and clutch. The owner had a minor accident with the car bending the core support, hood and busted the headlight and grill. I picked up a grill with new lights (was the quad set up) for $50. I straightened out the hood enough that the damage was minor enough to not be of issue. Same with the core support. I spent 2 days detailing it with a intense 3 step polish. Replaced a clutch cable at $35.Spent 300 on a set of 16″ Borbet wheels with tires and flipped the car for 2800. It covered my shops rent in the 3 total days of work I had in the car. The rest of the months work and income was mine. I do this at least 6 times a year and am trying to get to the point of doing 2 per month. I also buy wrecks at auction that still have good titles. These cars generally earn 3-6K profit.So in short, If your smart and handy, you can make a six figure income selling cars.
I’ve bought and sold 14 cars. I lost on one and made money on the other 13. the money i lost on the one was less than i made on each of the others. it’s risky but if you know what you’re doing there is definitely money to be made.
I have to agree with the previous Matt, flipping cars is incredibly risky, but with that said I do beleive that you can make money off of it if you know what you’re doing. Although it’s risky I don’t think it’s much more risky than flipping houses. It would definitely take care and planning.
nice site though, I will have to check it out further
Whats the risk? I have made thousands of dollars because I know how to buy below market. I have no car payment- I drive for free. Also, as a side note- I am not mechanically inclined- I do not look for cars to fix up- I look for something I can turn as is, or put very little into. The Discovery I have right now I got for $1100 less than I can sell it for. I put $100 into having the radiator rodded thats it. I have never had trouble selling a vehicle. I have made money every time.
I had no idea this practice had a name. I’ve done this in the past but found, for myself, it wasn’t worth the hard work to get the cars back into prime shape. Maybe I was buying cars that were too far gone. Maybe I shouldn’t have been trying to make them look like they just came off the showroom floor.
You are right about that. You never pull that money back out of a vehicle for things like spiffy wheels stereos, etc.
I ran an ad in the paper once, “buy yer old car” or such in the auto section.
Over the next few months, I bought cars really really cheap from people, learning as I went.
Some I broke even on, some I lost money on, some I made big money.
I think my best case was a Toyota I paid $75 bucks for, gave $50 to a mechanic who actually did a bit of a miravle with a valve part in the head, sold to some Mexicans at 3 am a couple weeks later for $1200. Cash.
That was nice.
But the local paper decided I was a business and jacked my ad rates up about 1000% and I couldn’t afford it anymore.
A friend who delivered pizzas would watch the driveways for cars which didn’t move, had flat tires, etc, and come by later and ask them if they wanted to sell the car. He ended up going full time into the business.
You can make some money, especially if you know how to work on cars (I am so-so, no mechanic for sure).
The title transfer fees can eat you up tho. Might wanna find a local car dealer and give them a cut each time, say $50 or so.
You don’t have to pay title fees! Just leave the buyers name open on the recently purchased cars title then it’s ready for the person you sell it to. And your name is never involved if the car breaks down on the buyer.
Is this legal? I did it today. Then the buyer called me and wanted his money back. He was a dealer. He threatened to call the police because of Title skipping.
You need a Bill of Sale in this case, which will protect you (the seller) and denote the car as being sold “as-is”. After signatures are made and cash is handed over, the buyer is now responsible for the car, period.
Her article is a long explanation of a single example of arbitrage, and I’d wonder about getting investment advice involving arbitrage from someone who doesn’t know what arbitrage is.
Successful arbitrageurs have an eye for things that are liquid and have different prices in different markets, whether they’re cars, houses, Yen, or pork belly futures. That’s a hard talent to pick up; if it wasn’t, there’d be more arbitrageurs, and more arbitrageurs dealing with a commodity tends correct the imbalance the arbitrage takes advantage of.
Cars seem like a risky target for arbitrage, not so much because of market conditions and depreciation, but because there’s a large industry based around arbitrage of cars: used car dealers. And like any other industry, they establish entrance barriers, like dealer registration. Ontario, for instance, has different regulations for private and dealer sales; what’s the difference between buying cars privately to immediately sell them privately, and a dealer simply pretending to be a private seller?
(Alternatively, why go to all the trouble of looking for private-sale market imbalances, when you can just register as a dealer, buy at dealer auctions, and let your increased return and turnover pay for the dealer registration?)
Lastly, it’s a bit odd that she thinks she has cars for free. Any car, paid off, will be as “free” as hers, except that a car that’s simply paid off won’t involve the expenses and time commitment that her “free” car involves. I’m not sure one should take investment advice from someone who forgets to account for capital, transaction costs, and opportunity cost in her advice.
I’ve never flipped a car, but my best flip (% wise) was a bread maker.
My wife and I bought it for $1 at a thrift store. I fixed it (very minor soldering job) , and we used it for about a month. Then we discovered that we didn’t really like bread machine bread, and sold it for $20.
🙂
I wanted to go buy another to flip, but my wife didn’t want junk arround our studio apartment. 🙂
Rich that’s a fancy word you’ve got there. Too bad the girl never said she had the car for free, neither did she break it down to exact costs- as that all varies depending on state and person. The point is it can be done, it’s not rocket science, and I’ll take my $500-$2000 a month over your five dollar word anyday. Those who don’t think it can be done need to get out of the way of those of us who are doing it.
Here in Washington you need to beware of how often you do it:
“Curbstoning is buying, selling or otherwise participating in five or more vehicle transactions over a 12-month period without a vehicle-dealer license. Violations can lead to cease-and-desist orders and fines of up to $1,000 per violation. Hard-core curbstoners are subject to gross-misdemeanor charges punishable by up to a year in jail and a $5,000 fine; repeat offenders can be charged with a felony. More than 20 states have curbstoning laws.”
So unless you’re making $10K a pop four times a year, you’re at best looking to put a little money in your pocket with the chance of getting burned.
I’m 39 and have owned about 50 cars, trucks and motorcycles in my life. I’ve made money on about half a dozen (not trying to, mind). It’s very risky in that cars are complex and lots can be wrong, and it will depend on your ethics sometimes…do you fix something (or tell the person buying it needs fixing) or do you remain silent and shrug when asked?
Earlier this year I was given a Jaguar XJ6. I figured about $1000 and 20 hours of labor would fix the head gasket (I’m a decent mechanic.) Head was cracked, other things were wrong. I had $1800 into the car in machining and parts–and sold it for $1800. I enjoyed getting it running again but had I spent that time billing at $100 per I would be $4000 ahead.
I imagine the easiest money comes at the bottom of the market in the “everyday transportation” category, but that’s also the least amount of profit. Yeah, you might make double or triple your money, but if we’re talking about $500 or $1000, that’s potentially a lot of work for not a lot of moolah. And if something serious is wrong, even an alternator on certain makes, you can end up underwater very quickly.
Curbstoning is illegal because dealers, even the scuzziest, actually have some regulations they must abide by. The car may have to have current tabs or be licensable, it may have to be safe, they generally have to take the car back within a certain window if it turns out to be grossly defective, etc.
Though it is really common to simply not transfer the title on cars you’re flipping, I believe that is also illegal, and sure to tip off the state…they get a report of sale even if you don’t transfer the title. Do enough, and they become curious why you aren’t transferring the titles on the cars you’re buying. Here in Washington, they’ll be even more curious why you aren’t paying sales tax on every car you buy, at almost 9%.
If it’s legal in your state and you’re savvy, go for it. But just like real estate, it’s not a place for the casual or uneducated. The guy who got his car fixed for $50 by a mechanic was handed a gift, a gift he will not get again if the mechanic knows he’s simply flipping the car. (And I wonder why the nationality of the buyers was important, but quien sabe?)
Car flipping might be illegal, and I personally have only flipped cars I bought and decided to sell but, how is it going to raise the eyebrows of the state, and how the hell do they know what you are selling if you don’t title it in your name? I’ll answer that, they won’t so your argument is invalid. In fact in my state TN I just checked tonight and I can sell 5 cars a year without a dealers license. They would need to catch my selling 6 before they could even say anything. Now as to not titling it before I sell resell it, well that is a different matter they could but most likely wouldn’t act on. An again, first they would have to figure out I was actually flipping cars, and what cars I flipped. Not likely they would.
When a government threatens to throw you in jail for running a profitable business you should know there’s big problems. They’re nothing but a mafia.
It’s not a matter of “don’t think it can be done” so much as “don’t think it’s a good risk for most people.”
Hmm…had heard of flipping houses, but never flipping cars. Interesting, but as I continued reading, any thoughts of flipping a car for money were erased. Not really sure I want to get into the used car market anyway. Oh, nice site by the way.
I wanted to echo Roger’s sentiments regarding the number of cars you can “flip”. There’s a similar regulation in the State of Oregon as well. On the other hand, I’m not sure that DMV’s requirements are all that tough, so just go get the license.
prlinkbiz, the part where she talks about driving for free is quoted *right in this post*.
The basic problem is this: Step #1, “find things trading below market price”, is not specific to cars, and is difficult. But anyone *capable* of finding enough things that trade below market price that are liquid enough to flip doesn’t need to bother reading the subsequent steps. So what kind of advice is this?
“Buy low, sell high”. Well, gee, thanks.
Hey, wait a minute. prlinkbiz talks about the author of the linked article in the third person, but curiously enough she shares the same username as the author of the article.
Why are you pretending that you’re not defending your own article, prlinkbiz?
Well, in California, you better get that car for at least 8% under market rate – you need to pay sales tax and title fees when you buy the vehicle and then next buyer does again. That is, if you actually do want “title free and clear”.
Maybe in other states you don’t need to pay sales tax if you resell within X months, I don’t know, but not in CA.
Also, one bad car will wipe out your profit for a year with either repairs and not being able to sell. You better be 100% accurate.
Do something that adds value to the community – buying a depreciating asset below market rate and finding a sucker to buy it above doesn’t seem like the ticket.
I stumbled upon this page and just had to comment based on the erroneous information I’m reading here…
First of all:
1) Buying and selling cars for profit is NOT an “incredibly risky” way to make money. In the grand scale of life and even business risks, this type of business is almost a no brainer once you have the foundation because there is so much built-in demand for used cars….and always will be!
2) As far as having to pay sales tax on a car that you bought in California with the intentions of reselling it… Just know that there are ways around all these things. All the clerks at the DMV want is that every ‘T’ is crossed and every ‘i’ is dotted and every line filled out. They just do NOT have the time and resources to check all these things out, besides, its rarely an issue because your car will be sold (flipped) before the paperwork ever gets to the DMV anyway.
3) Someone said something about how its not worthwhile to do this. What the?! Hmmm, please explain how making a clean $500.00, $1000.00 or $2000.00 cash profit from spending anywhere from 2 to 5 hours isn’t worth doing?!! Please, enquiring minds want to know?
4) Curbstoning is NOT the big scary deal someone said it is IF you are low key about it (ie: you don’t make your front yard look like a used car lot) and you are honest with your customers, but you can always get your car dealers license later if you choose to.
I have no monetary interest in this, but I learned everything about this from reading and applying what I learned from this guys book:
http://www.buy-and-sell-cars-for-profit.com/
Believe me guys, it is a VERY profitable way to make some very good money provided you stop wringing your hands ANAL-yzing and worrying about a bunch of silly things.
Sorry to come off as such a smart a&% but some of those comments made just had to be responded to!
Flipping cars is a very risky business due to many unlicensed and unscrupulous car “jockeys” who are running rampant on the internet and in local newspapers. They are not being regulated and the local authorities rarely check them out. One can make a lot of money buying and selling cars, but they must know what they are doing and must insist on full disclosure. As a car dealer, I am offered at least one car per week from a consumer who was hustled from a “curbstoner” who sold them a car from the newspaper or internet. If a seller only will sell for cash and will not accept a bank check stay away from them. Any legitimate seller will accept a bank check. If a car deal seems too good to be true, stay away! You only get what you pay for. Questions?? Call Vehicles Inc at 610-799-6000 to learn how to buy and sell cars and trucks legally without legal exposure and at the same time treat customers fairly so they refer you to friends.
Yes! By all means accept bank checks from your buyers, because the money is already there. But, do not ever accept personal checks unless you can hold onto the car until the check clears your bank. Otherwise, the buyer could cancel the check. You might get lucky to get your money or the car back. But, the police aren’t interested in being free collection agents for car dealerships. The courts are seldom helpful, either (& usually more of a problem than they’re worth).
For more info go to:
http://www.vehiclesinc.com
Here is my question. I just want to do 1 or 2 cars per year. I love classic cars and want to purchase 90% done cars and finish them out and resell. But Kentucky (where I live) requires signage and one use facility unless divided by a wall, etc.
I just want to do this out of my garage. Not sure what to do next. I know all the prices of licenses and insurance.
Help!
Mark
The term “flipping cars” merely describes the process where a person buys a car with the intention of quickly selling it for a profit instead of keeping it for themselves. There are people that flip (sell) cars for a profit and there are people that flip houses for a profit and millions of other items. Buying and selling STUFF is what makes the world go around and there is NOTHING morally or ethically wrong with flipping (selling) anything….and that includes curbstoning. The only thing that makes selling ANYTHING wrong is when some sleazy scumbag lies to someone about the condition of whatever it is they are selling in order to make a quick buck.
If you think for one second that just because someone has a car dealers license, that they are somehow magically transformed into some angel then you will be very disappointed. True, they have more to lose than the person without the car dealers license (because of the time and expense it took them to get their car dealers license) but we have all been exposed to sleazy lying licensed car dealers.
There are honest people that curbstone and there are dishonest people that curbstone, just as there are honest and dishonest car dealers.
Unfortuneately there are liars and cheats out there in ALL walks of life….with and without licenses. Just look at many of our politicians!
Its a buyers beware world folks. Always has and always will be and a piece of paper rarely makes a dishonest person become honest.
LOL I haven’t checked back here for a bit – Rich, I wasn’t pretending anything! John- thank you for ‘getting it’. I have since sold the vehicle in the article (paid $5300 sold it for $6200) and rolled $6k back into a 1999 Passat to resell for approx. $7K. I do it to not have a car payment, tie up my cash and grow it a little bit. That money becomes the goose that lays golden eggs for me! lol AZ is a great state to buy and sell in.
Rolling cars is a good business if you know the vehicles you sell. I personally deal with Land Rovers and ocasionally BMW’s, but I know these vehicles in and out and can perform almost any fix on them for a fraction of the cost of a shop. Now here is the important part, if you don’t know cars, don’t know the certain cars you deal with or are a scammer then don’t flip cars. I deal with higher end newer Rovers and do very! well with it, I am in the process of getting my dealer licence but I never want to be a “Car Salesman” I am more of a speacialist of the vehicles I deal with and I have a major passion for Rovers. If you shop right and know what you are looking at then you can make a very nice living and be a good, honest salesman. I follow up with every person I sell a rover to and make sure they are happy with the car and also offer any help and tech support I can for any future problems it may have. If you do it right and don’t roll a ton of cars a year then its all good but if you are greedy then it will catch up with you. So advise…don’t deal with cars unless you know what you are doing, AND BE HONEST!! I make more doing this than I do at my regular job, but its more of a passion for Land Rovers than it is a greedy business. I had a guy fly 1000 miles to come buy one of my Rovers because I take the time to make sure they are quality. Nice site and good luck in the biz.
God Bless
I wish you would have left an email or site link- I also love Rovers! I just sold a Discovery and have looked at several Range Rovers- love them! Shoot me an email if you get this, I’d like to keep in touch with you!
prlinkbiz,
I can’t figure out how to email you – How do you get funding to flip the car if you don’t have a couple thousand laying around? Just a used-auto loan with a bunch of interest? Also, I’ve found a car that would be perfect to flip and it’s a BMW so I wouldn’t mind driving it around for a while either, but I don’t have the cash to go get it. Help!
If you don’t have the cash on hand, OPM baby! Do you have anyone you might be able to borrow the cash from and give it back to them plus % once you sell the vehicle? You might be surprised you would be willing to partner with you if you can show them that you can make them some money. Depending on how fast you move, you can keep rolling that money into the next deals until you have a nice little lump of cash for yourself. I never took a car loan, although that may be an option too.
Ok, next question. What’s OPM? lol.
So many acronyms, so little time 😉
Nice site, great info.. I assume she meant
OPM – Other People’s Money
Wow!!
nice to find others like me that love to find great deals on cars and sell them for a profit.
i was buying and selling 88-91 honda crx si and hatchbacks..sometimes acura integras as well..i made great money on some,broke even on a couple and really enjoyed doing this for a living.
i plan on getting back nto it and adding a few other cars to the list…i did very well with the honda crx si models..they are getting more and more rare and hard to find in decent shape..hell!! i even sold them with blown engines..always was honest about these cars and still moved them just because of the huge demand o these cars from younger buyers wanting to fix them up for racing or show cars.
i once bought a 91 honda crx si in miami fl for $1500..he wanted $2200….sold it 3 days later for $2800 without doing a thing to the vehicle,just drove it from one location to another and cha ching!!!!
ofcourse i would rather have a dealers license and do it the right way and buy and sell nicer,newer vehicles…but it isn’t easy to do….i work for a labor union in miami florida (seasonal work)collect unemployment in the summer while work is dead…so this is a great way for me to supplement my income…..good luck to you all and i hope whoever does this for extra money “is honest” and makes good money and possibly soe great friends along the way.
It has a name, all right… it’s called “curbstoning,” and in Oregon, it’s illegal unless you have a DMV license and have posted a bond.
Can someone please differentiate this from “used-car salesman” for me? Thanks.
Hey John Franken – yes there are ways around that sales tax in CA – you LIE on the bill of sale and say you sold it for far less.
You don’t seem like the kind of person I’d want to buy anything from. You have ethics challenges.
if there is a name for it and it’s been made illegal in 20 states because uncle sam looses his cut, there must be a profit in it.
A practical issue (concerning titling and sales tax) is where I live you have to have license plates,tags, and insurance to legally drive a vehicle. I have always assumed it is that way most places.
In order to have all of the above, you have to go to the MVA and pay sales tax/registration. When you buy a car privately, it does not have license plates ( dealer will usually get you temp tags). I forgot to mention you can’t get tags without an inspection. Almost any used vehicle will need some work to pass. Fortunately you can get an inspection for around $50-75. If it fails, you have to get work done then pay again. Most people who seriously want to sell their used vehicle will either make sure it has passed inspection or will allow any potentional buyer to have their own inspection done. After all, The car will not be allowed on the road until it passes.
( All of the above is using the premise of buying a car and “driving it free” for awhile before selling it)
So let’s say you buy a car that needs NO work to pass inspection for $5000. Before you can even drive it yourself, you will pay about $75 for inspection, $140 registration ( partially refundable or transferrable to your next vehicle) and $250 sales/use tax ( my state actually being on the “low” end at 5%). Then of course insurance. Now you will be over $500 in fees and expenses before YOU can even get the car on the road. If you sell at a $1000 markup- there goes half the profit. When you sell, your buyer will have to go through the same- and depending on the time period you will probably have to get another inspection,etc.
I have also never known anyone who bought or sold a car CASH on the spot. Normal procedure is check ( though I might understand the going to to bank to make sure its good part) with a notarized Bill of Sale.
I have a friend who tried this a few times with cars from abandoned property auctions. He did OK, but not as well as he hoped ( he went to school for autmotive mechanics and is also business savvy). He also bought at very steep discounts- like buying a $5000 car at acution for $2000- and never relied on any of these deals as his primary personal vehicle.
Also ( and his experience illustrated this as well) the part about “not discounting your price” and not being desperate to sell,etc. You have a time vaue of money and at some point even deals that look great you may have to take less just to get your money back and free it up for other deal. Very few private party used car buyers are paying asking price.
Though I guess some of my presumptions could be wrong- this tactic involves taking advantage of stupid people and driving illegally( or is just specific to a certain state,etc).
Hey Numnutz,
“Ethics” about what to put for the amount on the Bill Of Sale you say? Hmmm, well that brings up a whole lot of philosophical issues about whether the government is better at spending your money or the individual. Me thinks the individual, but what do I know.
Actually though, if you are buying and selling cars for profit then it would be up to the BUYER to decide what they want to put on the Bill Of Sale and not the seller.
As long as the seller is being COMPLETELY HONEST about the condition of the car they are selling then what do you care what the heck the buyer puts for the amount on the Bill Of Sale?
Greg C said: “I have also never known anyone who bought or sold a car CASH on the spot. Normal procedure is check ( though I might understand the going to to bank to make sure its good part) with a notarized Bill of Sale.”
Greg C, it sounds like you live in a bizarro world populated by anal retentive accountants.
My experience (and I buy and sell cars for profit — hundreds!) is that it is up to the seller to dictate to the buyer how they want to be paid. If you want a check and the problems associated with that, then accept a check. Me, I prefer to be paid in cash so its done and over with and have worked that way for probably 95% of my car deals.
I just came across this blog today and it seems that the posts on this page are mostly (not all though) from two kinds of people…
– Paranoid types afraid of their own shadow and terrified to step out and risk a few hundred dollars.
Or….
– Overly analytical negative types that have zero experience with buying and selling cars for profit, but are more than willing to give their (ahem) “educated and expert” opinion on how to buy and sell cars for profit.
I am doing that exact thing. Flipping cars … I didn’t know other people were doing it too … I thought I came up with the name “car flipping” lol …. I’m a fan of the house flipping shows …. I have 3 or 4 cars in line for me to put a little money into, and resell …. I can’t wait. Any kind of flip is risky, but you’ll never know until you try it. Most likely it will turn out great!
I began flipping cars in college for extra cash. I go to auctions, buy a car w/ a decent body and that runs decently for no more than $500. I take it home, detail it…and sell it for $1000-$1200 a pop. It is incredibly fun and easy…we only had one that needed major mechanical work. Once the car was fixed it would have been worth $2000 or so but we didn’t have the time, interest, or expertise to fix it so for us…a trade was a natural next step. We actually ended up trading it to a mechanic for his clunker. Then we sold his for $1000…lol.
I THINK ITS A GREAT IDEA!HOW DO U AVOID THE FEES FOR TAGS AND REGISTRATION IF U WANT TO SIT THE CAR SOMEPLACE TO SELL?
Most auto dealerships in the world can trace their orgins back to “flipping” cars. I should have my first deal done any day. It would be great to link up with others doing this and share stories/ideas.
I just read your blog, and am also getting close to buying my first car and giving it a try. Being a car lover for many years, going to give it a try. Only working part time, and would love to talk with someone also starting out. If not best of luck to you.
I have done this with some success. Completely legally. I like cars in the 5-6K range, and oddly enough I buy from dealers. My luck has been with high volume items. Dealers will sometimes unload their trade ins cheap. Why not, they took the trade and a guy paid sticker price for a new one. Best deal to date was a prestine 98 F150 I bought for 6200. After tax title it was 6900. I sold it in 2 days for 8700.
Trade in value at time was 6000, KBB low retail was 8500 and high was 10,500.
I got a good deal and the guy I sold it to got a good deal.
Well this is strange. I have a quick question about stuff in Oregon. Does anyone know like laws and stuff regarding car flipping? I’m 17 and have been doin this a little in the summers. Its a gr8 idea. I am not mechanically inclined i just buy cars for like 1 grand or so, usually i look for quick fixes, (cracked windows, very dirty, etc.) and pay a guy i always go to do fix it. I told him whats up, and he gives me a good deal since I always come back. Its a great idea, but i was wondering if I’m breakin any rules or whatever?? help is cool thx.
I live in California and am pretty car savy. I would like to start “flipping cars” regulary. Is there a legal limit in california as to the number I can sell with out a liceince? I feel like I have to register the cars in my name and get them insured, just in case a potential buyer has an accident….
ADUBSIZZLE:
What law could you possibly be breaking? All you’re doing is selling cars that you legally own. Keep up the good work.
Ron
Check with the California DOT or do a google search on California Auto Dealers Licensing. You will find everything you need to know. That’s how I learned about Texas.
If you would really like to learn about the car biz, take a job selling them. Dealers will give anyone a shot. A few months of that will let you know if you have the guts for it. The best part is free training while getting paid! I made 30,000 my first year, last year I made 85,000. That takes years of repeat customers, not bad for a college drop out? All you need is a few months to understand the basics. What’s Hot – What’s Not. Where, When, and How! If you are living week to week, do not try this. If you can lose a couple of grand and they won’t shut your lights off. Give it a shot.
Regarding what Steve above this said:
“If you would really like to learn about the car biz, take a job selling them.”
Actually, working at a used car lot is not a bad idea because you will definetely learn how to sell, which would serve you well for pretty much anything else you do in life, but buying and selling cars for profit from home requires sales techniques that are of a much more subtle nature. I think someone else mentioned this before on this page, but I learned tons about how to start a used car business from home from this guys ebooks: http://www.buy-and-sell-cars-for-profit.com/
Hi,
My name is Greg, and I am a licensed dealer in LA. I’m starting an online community of people involved, or interested in buying, and reselling cars. Come to my website, and ask me a question. I’ll do my best to answer it, write about it, and post it on my website.
http://the-car-flippers-companion.com/
What is the law in California as to how many cars you can own or sell in a year?
Flipping motor vehicles in Calif. is illegal. It becomes illegal at the state level when you have several vehicles for sale. You are then in fact operating as a used car dealer which requires you to have a buss. lisence. You also violate state law when you privately sell a vehicle and don’t pay state sales tax (tax evasion).
In Oakland, Ca. it is also illegal to sell cars using public street to advertise cars for sale (for sale signs in the windows, etc.) and to sell them from city streets (Oakland Municipal Code: 12.24.070.b)
In Oakland CA you can privately sell cars on the street with “for sale” signs. Law changed Jan 1 2013. In CA only dealers have to pay a income and sales tax on cars sold, not private party sellers.
I’ve been flipping cars for years with no issues as long as you know the rules and right people.
If you don’t know the rules, it’s only a $500 fine and a slap on the wrist. Be smart and you can make your money. Don’t knock the hustle TF.
Hi,
I’ve been selling cars two cars a year in Arkansas, the legal limit without a license, for several years now but I’m moving to Texas and I can’t find the legal limit there. I’ve looked looked through licensing documentation and dmv websites but I can’t find it. Can someone please help? Thanks.
I’ve profited and thus not paid a penny for my past 4 cars. Drove one for four years. It all depends if you have the eye for these things. I mainly look for killer deals with nearly nothing needed for the car. Find someone hard up on cash and low ball them. IMO flipping cars is a heck of a lot less risky than flipping a house. Car = $1000 and the market for a used car is pretty steady. House = $100k and the market is all over the place and your stuck with a huge liability.
Don’t fear flipping cars.
I came across a pretty cool website that has a lot of information on this subject.
http://www.sell-cars-for-profit.com
I myself have flipped a couple cars on the side. First I drive them for a couple months, then I sell them for a profit. I’m driving for free, and making extra money on the side.
Wow! Just reading about flipping cars is exciteing, been doing it for about 4 years and got a license this past september, still learning alot and haveing fun makeing money while selling happiness to my friends and family .Lots of good points made , its all in how you do your buisness, learn as much as you can and be fair and honest and like george said stay away from ” overly analytical negative types , they will suck the life right out of you!!!!!!!!!
Hi I live in Canada does anybody have a recommendation on which kind of cars I should start flipping first. I was thinking of selling hondas and acuras simply because I use to sell hondas at a dealership and I know the product as well as resale value is good, so if it doesnt sell right away I have a little lee way any suggestions
very exciting stuff…matter of fact, flipped my first car a couple of weeks ago, netted $1,200….I was wondering if there’s a discussion forum, or a community of flippers that do this stuff from home, not deals. A way to share and expand our experiences…the whole idea of being small and doing this is what excites me. I have a friend of mine who has 2 mid size dealerships and he has all the headache in the world…small is the next big thing…. let me know please.
Thanks for the help guys.
Looking at all these replies has made me realize that this is not the land of the free and home of the brave. More like, land of the fee, home of the slave. Our goverment takes everything it can from us and the sheeple do nothing about it but stupidly follow. someone says your breaking the law for doing a honest deal like buying and selling a car and not reporting it to the dmv. that doesnt sound like a free country to me. One of these days the people need to take the country back by not electing the morons who are taking everything from us via taxes. Wake up people!
Imafishfreak, I’m with you. I felt sick to my stomach reading that you need a “license” to be a “car dealer” just to buy a car for purposes of resale. In most states you apparently need a “license to handle food” just to make and sell food – as if mass poisonings were a major crisis before such laws. There is so much of this nonsense, I guess it helps protect big businesses from the competition of the little guys but in the long run America is only screwing itself. This is why other economies can manufacture things much more efficiently and they’ll just overtake and eat America’s lunch soon unless we reverse these ‘communist’/fascist laws.
I have bought and sold several cars in the past two years and now I’m upset. I don’t have any dealer’s licence. Just buy and sell as a private party. I want to ask prlinkbiz and John Franken and other guys who are doing this. Was there a time you asked a seller to put less amount on title than you actually paid in order to save on sales tax? Was there a time when a buyer begged you to do the same thing when you were trying to sell it? I believe you’ve done it. Chances are you’ll never get caught by IRS. But once you get caguht,
(IRS may contact all the sellers and buyers to nail you) you might spend 5 years in jail becase tax eavsion is a felony in the states. Plus, it is illegal to buy and sell more than 5 cars in a year. You might say it is unreasonal. But say it to who? to judge?
I started to doubt if it is worthwile when I can’t sleep well because of these.
Ive done this quite a few times with honda civics, because I know them like the back of my hand. If you know the car you can’t go wrong.
http://www.carflipper.org is a pretty good resource too
I’m starting to consider flipping cars, but I’m very confused on one thing. How can you avoid your state limit? (I live in california btw). How do you buy and sell cars w/o registering under your name w/o getting caught? Like, lets say you buy a car from person A. You let person A fill out the seller info, but then you leave your section blank. It is now an open title. You then immediately sell it to someone else. But when person A turns in the release of liability form to the DMV (with my name/address on it) what am I supposed to do?
Basically, I’m asking how to “title jump” without getting caught.
Jack –
– It is IMPOSSIBLE to get caught by the IRS. You’re forgetting that the seller has every right to sell the car for however much he/she wants to, whether its 10K, 20K, or 500 bucks. It is impossible for the IRS to PROVE that you didnt pay the amount you wrote down, considering the Bill of Sale states, with both the buyers and sellers signature, how much the buyer paid. ALSO, they can’t determine the actual value of the car, so its not like they gonna bust you for selling a nice car for 100 bucks (for all they know, the car could be salvage, broken, parts missing, no engine) there is no legal way to prove you wrong, so the chances of getting caught are zero.
If you know about cars and the market, you can make a nice living “flipping” with or without traditional job. If not, you will blow money like the wind. Build relationships with a general mechanic, body, interior and auto electrical tech that does good work, and that is cheap. The name of the game is low overhead. I typically buy cars @ dealer auctions that are cheap (in price), clean and need little to no work done on them. If you can get sponsored as a buyer by a small dealership, do so rather than starting your own.
I think it’s a great idea to buy & resell cars. In Florida, you can sell 3 per year without needing a dealers license…I’m kinda sad that I didn’t think of it before now. (like december of 2008) 😉 I am always finding cheap cars (200-800) that are fixer uppers and can be resold for profits anywhere from $1000-4000 a pop. I have never done it before but I am kind of scared to invest my money in something I know nothing about..But I figured the worst that can happen is I break even…but I seriously doubt it if I buy a car that cheap. I think it’s a start to “grow” my money and if I can do it then I will get my dealers license after the 3 cars are sold. I can probably make good profit selling the cars…we will see! My moms car broke so I also plan on finding her a fixer upper to surprise her with. =)
weird how this attracted some whiny libertarian goth kids. this isn’t the land of the free, waaa waaa waaa. stfu, name one country where you can make money this easily flipping cars? you can’t because you’re so busy whining you don’t realize how great you have it. even the highways are free and you’re still whining about taxes!!!! go to europe! go to japan! you libertarian tards!
omg the government takes sales tax!!! how dare they!!! we have the cheapest gas and roads and lowest taxes in the world and you’re all whining. grow up, infrastructure doesn’t build itself.
There is VERY good money in flipping cars.
I flip 5 per year in my name and flip another 5 per year in my wifes name. And before someone start shouting…YES! it is legal. Is there risk? Of course there is. What kind of business has no risk? The best way that works for me is to buy in the $500 to $1000 range so that my cars sell fast. People want cars that are cheap! You can have a very nice car for sale at $5000 but lots of people can’t come up with that kind of money. Stay in the $1000 range and if you do make a bad investment, You won’t loose the farm.
Hi Smurf,
Do you have to get the vehicles in your name right away after the purchase and get insurance also. I live in California.
Thanks, Jerry
What I like to do is drive around the car for my actual use until the brakes are well worn or other issues come to play. Sometimes I get a car with a busted window, but is drivable from going from A to B. I bought a 1999 Ford Taurus for $350.00. I did nothing to the car other than change the head light bulb. I drove it for a solid 7900km for 4.5 months and resold it for $1000 after I trashed the disk, brake drums, rotors. A kept braking for 3 weeks after it started to squeak, so I think I messed it up bad. The oil gasket went, and oil was leaking. Towards the end, fuel started to come from the exhaust, so I bought a 1992 Toyota Corolla for $650.00 the difference between what I paid for the Taurus and what I sold it for. The corolla I got 10,600km without having to do anything to it. Unfortunately, the trunk lock broke, and it didn’t close properly after a while. The brakes started to squeak, and the muffler became rusted, and it created a hole in the muffler. Also, the water getting into my trunk and it came into the driver’s side around the feet. The honk and fan motor stopped working due to the electrical, causing defrosting impossible while driving. I sold the car for $800.00 only but I had the opportunity to use it for six months, and I used that money to buy a 1994 Volvo 850 that is in running condition, but with little brake pad life, but since it is a manual transmission, I am able to clutch down and then brake as to not use much brake pads. This car needs a tune up, rotors, distributor, and spark plugs I think. It still runs nonetheless, and starts after a few tries. Flipping cars is something I do not as a business but as a necessity because I cannot afford anything better on $12.00/hour. Over the year, I made no money since I did not recover my vehicle transfer, and annual insurance. But I require a car for my job doing deliveries so I don’t see a car as an investment but rather as a tool. I just sell and get another because I figure if I have to fix these things, it would be easier to have someone buy it off my hands and I could go on looking for some other car to drive in for a few months before I have to replace it again. Although I didn’t make any money at it, I did manage to get 18,500km off the two cars I sold before acquiring the Volvo 850, which is worth putting a bit of money in to fix up.
Well, I happen to make roughly $25K per month “flipping cars”. A word of advice, you won’t find cars you can resell for profit on Cars.com, sorry. And if you use kbb.com to come up with values to buy or sell in the real marketplace, you’re getting ready to take a bath. I spend a couple hundred bucks a month to maintain an office for my wholesale license, so I’m not a curbstoner. If you study the market, you already know who you’re selling the car to before you buy it, and how much your going to make. It’s not rocket science, but it can be risky if you don’t know what you’re doing. It’s not risky in the same why real estate is though. Being that cars depreciate, your biggest threat is time. Which is why I have the car sold before I even buy it. It’s a legit way to make a living, and can be VERY lucrative.
” if you use kbb.com to come up with values to buy or sell in the real marketplace, you’re getting ready to take a bath”
Hi, Can you explain what you mean by that and what car brands have worked for you ?
Wow James. amazing number on a monthly basis. I do flip cars as well..started 2 years ago along with my brother, and we are making enough to maintain a decent life style.
We have been looking for ways to pump up the volume and take it to the next level. We pretty much find our cars through Craigslist and by driving around.
If it isn’t too much trouble, is there a way to contact you. I would appreciate a few minutes of your time to chat about the business. email: [email protected]
thank you
I totally agree with the last comment.Used to curbstone,but if u have a wholesale or retail license, buy at dealer auctions and sell at public auctions. It’s working rather quickly and well for me. A car costing $1500 at dealer auction is netting me around $3000 at public auction minus small selling fee. I’m doing three cars a month and making some sweet cash.
i guess i need to start researching locations of dealer auctions and public auctions.
As of now, i am buying from private owners and reselling to private owners. I am stuck at making $800 to $1200 a car.
Netting $3,000 on a car would be great. yet, i have been asking dealers who go to auctions and everyone is saying that the auction cars are expensive these days and not much of profit to be made.
Also, i have a dealers plate that i use to move cars around,which i am renting from a dealer), so i need to look into getting a wholesale license or dealer’s license.
thanks James for the input.
Your welcome Ron. Sorry netting $1,500 profit per car.100% profit on what I spent. I usually buy good transp cars like Olds Intrigue, Dodge Intrepid, or even Caddy DeVilles. Older people love Caddy’s. You can pick all these up for around 1500 to 2k at dealer auction, and sell at public auction for 3k to $3500. Make sure to clean them well. Touch up minor scratches. You know make it sexy. I started out 5yrs ago hanging outside dealer auctions I could not get into. Was discuraged, then asked a guy to sponsor me as a buyer. We completed my buyer license, I gave him $500 and my word. I gained his trust, and that was that. To make good money, stick to dealer auctions. There you will pay slightly above trade in prices which is the way to buy. Tow auctions suck, and Craigslist is cool if u can find a desperate seller. Hang in there.
Wow, think its hard to buy a car and make a profit, well I just bought a 98 lincoln continental for 500 bucks today. I plan to sell it once Im done using it for atleast 3,000. I dont think 2,500 is to bad of profit for somethng that took less than an hour.
So i want to do this but… How do you deal with the long wait for a title so you can sell???
I did this quite a bit when I was a kid. I took ads from the “free ads magazine”. Bought cars from $300-$1000 which needed one or two things to be roadworthy. I wouldn’t change the title, and most buyers didn’t care. (Where I am you can only sell 6 cars a year.)I would always clean the car completely including engine bay, get cheap or used parts, get it roadworthy and sell. Made $1000 off a Cadillac with over 40 callers one week. I’m thinking of getting back in. Sense says 4 door Chyslers (cheap to buy), Pontiacs etc. Go for high volume seller cars. Best sell range is maybe $2-$3500….or a little more. There are alot of people who just need a cheap roadworthy ride.
P.S. Where I’m from we call it “curbsiding” – the derogotory term. To me is makes sense, you are selling cars at the curbside. Where the hell does curbstoning come from?
I think laws against it are stupid. If you were fixing and selling bikes or lawnmowers nobody cares. I never ripped off a buyer. Sometimes you find a car with “Electric window broken” which needs a fuse. Sell low and sell fast.
My friend’s dad does this for extra cash. Here in Cancun, there’s a kind of car market set up every Sunday where people buy and sell their cars. He’ll go and find someone desperate to sell their car cheap. He’ll buy it, have his son drive it around everywhere with a sale sign and phone number on the back, then sell it its regular market price or more.
He makes between $300 and $1000 per car (inexpensive cars).
Then again, regulations aren’t nearly as strict in Mexico as in the States, so I’m not sure how easy it is to do in the US.
My husband and I are thinking about investing with them in the future for a few extra bucks.
Its not that risky if you know what your doing, and what your looking for. Asian vehicles are typically gold mines over domestic. Several times ive been able to pick up Civics or Supra’s for around 500, i put a couple hundred in. New brakes, fluids, whatever making sure to include in advertisement whats been done, remove the seats and shampoo and clean the car inside and out 100% and i average a resale of around 1500-2000 dollars i generally manage to sell around 4 or 5 cars per month in my spare time. and i make anywhere from 4-6 grand a month just working weekends. So its not as risky as you would think if you do your homework.
does anyone know how many cars can you buy and resell in Oregon?
I recently got an opportunity to buy new luxury cars for a third-party company based in US. They pay me $500 for each sale. What I need to do is: go to talk with the clerks in 4S stores and make the deal happen, then take care of the DMV stuff and drive the car to the third-party’s warehouse. All buying charges and DMV charges are on them(need my name to do the transaction). I don’t know how they make a profit, maybe exporting or something similiar..
What I want to know is : Is this way of making money illegal? Is is safe to do so? Or is there a limit of numbers of doing so? Thanks guys!
Now i never thought of myself as doing this but i guess i have a time or two. I bought a saturn for $250 with a blown motor. I bought a new motor and put it in and i did a little body work. replaced the clutch and throwout bearing while i had it apart. I sold it for 2800. It wasnt a huge profit but since i know some mechanics and went to college for auto body, it made it pretty cheap.
I dont know why people are arguing back and forth on here. Some people like it, some dont. I did everything legally. I registered it and plated it, paid the sales tax. The nice thing about my insurance company is that they have a special insurance that is dirt cheap for vehicles that are not driven. I worked on it and paid under ten bucks a month to insure it.
I understand if you dont like this stuff. I also understand that there are some shady people out there trying to make more money than is fair. Just remember, dont stereotype everyone for a few peoples mistakes. I bought this car at a fair price and sold it at a fair price. I didnt screw the government or the buyer or seller. On the other side, i have bought a vehicle from a used car dealer that had said the car was fully inspected and had repairs done two months prior to me buying it but one month after i bought it, the clutch went out and that was one thing that was “replaced.”
Be fair. I dont come to your office and s#@t on your desk.
Most of you guys are thinking go pick up a car from someone who is selling it localy. the key to this buisness is three things. one,finding the cars in demand. cars are in demand but what kind is more in demand than others varries so you have to watch the market on used cars, watch the prices. two, look for ccheap repairs. insurance companies will claim a car totaled over a bumper falling of cause its “too expencive to fix”. sports cars are the most wrecked cars out there. say you find a car (BMW m3 for example) and its being sold for $2000 at auction, all thats wrong is that bumper, dealer will sell the bumper for $500, you look around and realize hey i can buy a replica bumper for $50. slap it on and sell it for $10,000, you just invested $2050, sold it for $10,000. profit (minus any charges) $6000 easy (thats covering about $2000 in charges which is a lot but this is just an example) so from that you can see its not hard to do. third, make it simple. simple repairs pay off, as in the example cars are claimed “totalled” for anything now so finding cars that only need simple repairs is easy. so all you nay sayers out there, don’t know what your talking about, this is an easy buisness to make money in if you have a technician to work on it and even easier if you can do it yourself. so dont nock it just cause you dont know what your doing. research, research, research. thats the key to this whole thing. look for deals and take the steal, thats the blood of this buisness. have a friend who makes thousands doing this (he’s only 20 years old) I’ve seen how its done and i understand it very well. anyways i thought i would clear up why people dont like it (they dont know what they are doing) and why people like it (my 3 points). you’re welcome
i live in iowa ive always worked in a shop and done all my own work.im trying to get a dealer lisence and make something bigger out of flipping cars.ive had great sucsess so far ive flipped 4 cars in the last 2 mo all profiting over $1000. i just go a 2002 buick rondezvouse for $500 that the ppl thought had a bad tranny.i changed fluid and filter drove it for about 5000 miles and sold it for 4500.it kbb for 6000.so i was able to buy it and fix it all for 700 by the time i was done with it.thats a 3700 profit in a month.another was a 2002 dodge stratus.my gpa gave me a old rusted out truck i trades for the car plus he gave me 350 on top.it had bent valves.i put a timing kit a head and new gaskets on the stratus spending about 500 and sold it a couple weeks later for 3800.there can be very good money in this that is why i am taking the next step to get a dealer lisence.good luck everyone!
I think this is a great idea, and actually, I wrote a little bit about this on my website. I’ve found that there are great deals on Craigslist when trying to flip cars. It gets better if you know a mechanic, or have some expertise in fixing up cars.
I actually purchased a 2003 Mitsubishi Lancer for $2000 and ended up making about $1500 profit after all was said and done. It took me about 3 months to turnover the car and the kicker was that I bought the car from a college student and sold the car to another college student.
One thing you need to be careful of is to look at state laws and determine how many cars you can keep at one time without purchasing a car seller license. If you have too many cars, you may have to purchase a license as the government will treat you as a used car dealer. This rule varies from state to state.
One thing you need to remember is that each state has different laws on what is considered a used car dealer. Make sure you look at your state laws before purchasing a few cars as you may be considered a used car dealer and may need to pay extra fees to sell your vehicles. If you are going to sell one car, then it shouldn’t be a problem;however, if you keep selling cars every month, then you may want to look into your state’s local laws for vehicle sales.
I use to flip cars back in the late 90’s and made good profit. The only problem was I was not keeping a lot of information (profit, budget & selling price) to the people who would refer sellers to me. Basically, these guys are sales associates working for new car dealerships and each time there is a buyer who would want to trade their car, they would call me and I would buy it from them at a little bit above the price their dealership is willing to pay for. To make a long story short, when they have learned that it was very profitable, they did it themselves and I ended up not getting any referals from them anymore. I guess what I am trying to say is, for those who are in this business, try not to expose how profitable this is especially to the people around you. Because you will come to realize one day that that they are doing it themselves leaving you with a lot of competition.
I hate the term curbsiding (as it is called in Canada- where does the stoning come in?). the term refers to shady people misleading buyers. If I buy and sell a car and am honest about it, I don’t see the issue. Used car dealers try to make personal sales look bad, but the cars can be in better shape than at a dealer. I bought a Buick once for $300 and fixed a whole in the floor, fixed the horn etc and sold for $1200. Cadillac for $1000, sold for $2000 with 41 calls in one weekend. I would buy bigger unwanted cars in the City, and sell them in the burbs where they are worth more/easier to drive. Best turn is a car than needs only a few things to be roadworthy and owner can’t afford to fix/doesn’t want to fix. Buy in free ads, sell in paid ads. And you may lose the odd time. Ontario now limts to 6 annually, which is plenty, but you can pass the ownership across. Again, if you are honest with the buyer, no one loses….oh the tax man.
Flipping cars is risky. Why? Because it’s illegal if you sell for profit more cars than your state allows. Each state has a different amount from as low as ZERO to as high as 12. My state it’s 3.
The states have business licenses to protect the consumer; real estate, lawyers, beauticians, car dealers.
To leave a title blank or “jump” a title as mentioned in the comments is tax evasion. When an individual buys a car they are require to pay sales tax and licensing fees. To not do this is to evade taxes.
When you operate a business (flipping cars) you are violating the laws of your state. So, yes it’s risky. If found guilty, fines and a criminal record; usually a misdemeanor or tax evaxion can be a felony.
Do a YouTube search for “curbstoner” and see what states have to say about flipping cars.
Everything you say is true, but if you browse the cars and trucks for sale section of Craigslist, you’ll see that most people could care less about the risk. I’m not saying anyone should ignore the laws and do it anyway, but they do ignore the laws and do it anyway.
People’s rational is probably something along the lines of “I don’t have to pay taxes when I sell my personal belongings on ebay or craigslist, so why should I if I want to buy and sell a car for quick cash.”
I’ve never heard of anyone being prosecuted or fined for skipping title. If anyone reading this has, please respond.
Flipping cars isn’t any more risky than any other common types of investments(stock market for instance). It’s all about taking calculated and smart risks. Any financial investment carries some risk, but you take steps to mitigate that risk.
Buy OEM parts. This means that they’ve come directly from the manufacturer. Generic parts may cost less, but they are not as good. A cheap, generic part is less of a bargain if it only lasts half as long as an OEM part would.
Flipping motor vehicles in California ” Is Illegal”. Oakland, Ca. Municipal Code (OMC) 12.24.070.b prohibits use of public streets to advertise vehicles for sale and to use public streets to sell vehicles.
It is also a violation of Calif. state law and you can get your vehicle (s) impounded and you can go to jail. Putting for sale signs in the windows of vehicles and advertise them for sale on public streets is basically doing business without a license and the Dept. Of Motor Vehicle can investigate and prosecute you for that and also not paying sale tax.
The DMV did a sting operation early this year in Ventura Co. Calif. where 2 – 4 vehicles were impounded and two of the sellers went to jail.
If you are selling cars from the streets in Oakland, California, take note that it is a violation of Oakland Municipal Code 12.24.070.b and is also a violation of Calif. State law.
Take a class at your local technical school on auto body repair or mechanics, and you’ll be allowed to bring in a car to “play” with.
my mom bought land rover discoverys to flip and those are not in demand cars. then i thought well ill help her out 🙂 we would make a decent amount back on our return i believe the average was around 650 each car, and sold about 3 or 2 cars every three weeks. Please if you are wanting to do this don’t fall in love with a car you buy or try and help out friends. Thats where my mom went wrong. im planning on getting back in it but this time im older (25) and will do things so much different. I came from a family of business owners and if you have kids and want to teach them to someday be their own boss this is a good thing to do together. not to mention you can make some awesome memories.
Bought a Lincoln welder of clist used it for 3 years then decided I did not need the welder sold it and made $1400 profit. Can be done just have to know what your looking for and what it’s worth.
There are lots of issues involved with buying and selling cars, with or without a license. I have a Body Shop in WA State and had a Dealer’s License for 9 years; Did not renew it in 2012.
In Washington it states that selling more than 4 cars per year requires a dealer’s license, but it also states buying and selling cars for profit (“dealer like activity”), or selling a car that is not in your name also require a dealer’s License. So they can get you for selling one car if they want, and if you get caught it’s a fine of up to $1,000 per incident.
When I was a dealer, I would see the semi-annual reports of who got fined for what, so they do catch people.
Buying cars and passing the title straight through to the next person without putting it in your name is illegal. The State wants it’s sales tax and the State requires anyone who purchases a vehicle to notify them within 5 days of the purchase (even if you aren’t registering it for road use you have to do a Title Purpose Only change). No matter what you feel is right, it’s just a matter if you get caught. Usually you’ll get caught by some stupid set of circumstances, or if you do a lot of volume, or a customer reports you.
If you’re driving a car that is not in your name and happen to have an accident or just a minor fender bender, you might have a problem, especially if the person who sold the car to you filed a report of sale (they can do that on-line even if they didn’t tear that part off the title) and even more of a problem if you have a for-sale sign in it. Also, do you have insurance showing that car. You can get Broad Form insurance that covers you for any car you drive, but that can be expensive and in case of an accident they can sue the owner of the car in addition to the driver. In turn the previous owner will be filing suit against you.
Once again that’s if you get caught.
The other thing is anytime you turn a hobby into a business, you pretty much take the fun out of it. I learned that in this business (both the Body Shop & the Car Dealer). I also did that many years ago when I took my hobby of photography and made it a business. You end up spending lots of money on legal licenses and such and spending 70% of your time running the business and much less time taking pictures.
Getting a Dealer’s License isn’t hugely bad to do. Here in WA you need to have a commercial location that meets the zoning requirements for it, have signage, have a $30k bond, and also have hours from 10AM-4PM at least 5 days a week. (the latter is kind of weird, not required by some other states). The hours can also be an issue for a one man operation where he needs more time to be out looking for cars. Also need a business license and once you have that, you’ll likely have the Fire Martial doing an annual inspection, and have to file with the Sales Tax people.
I just went through a ‘Random Sales Tax Audit’. Not fun, but my paperwork was quite clean, they said, but I still have to pay about $1900 for the 2010 to current period for little stuff. But, since I was a car dealer for some of that time in addition to the Body Shop, they looked at the file on every car I sold during that time. I sold two cars out of State, one of which went to Australia through an Ebay sale. I’ve got all the documentation through Ebay about who bought it, plus all of the correspondence with the guy in Australia, but if I couldn’t come up with the transport company’s Bill-of-lading showing that it was picked up and transported (not driven from) here I would have to pay the sales tax on that $7k. I did find that form. Also sold a truck to a guy in Oregon through Craigslist. He came up with a trailer and pulled it out of here. Even with all my documentation, I ended up having to pay the sales tax on that $3,500.
During the time I had a Dealer’s License I sold more than 300 cars. Most of the cars I purchased through the salvage auctions with some damage, but being a Body Shop, I knew what I was looking at. I’d only do older cars with minor damage on them, and I always told buyers where I got them and had photos of the damages. I did not want to mess with heavy hits, even though I have a frame machine and do insurance repairs. I just wanted easy sells. Most cars had to be inspected by the State Patrol before I could get them titled, and I had a good reputation with them. They told me early on that it’s tough for the honest guys to make any money at this; the money is in fixing the late model high dollar cars where you can hide poor repairs and parts in the fix. They were right. The other big factor was when they let the public into the salvage auctions (used to require a dealer’s license), that’s when the costs pretty much doubled on the older salvage cars.
Another issue popped up as well. I would specialize in a certain car; I did a bunch of ’94-97 Honda Accords, some Dodge Neons, and some Lincoln Mark VIII’s (I happen to like those with the Cobra type aluminum motors). I’d buy a parts car of that model and fix as many as I could with the parts from them. I fixed 5 Accords from one of my parts cars. When getting them inspected I had to document where the parts came from, so I’d have the title from the parts car and list which parts & where they went (By VIN#) and cross-reference that on the fixed cars. The State Patrol was fine with that. Did one here in 2013 and they still were fine. But they tipped me off that another branch of the DOL (DMV) was checking rebuilding Dealer’s like me down in the bigger city areas, and fining them because they didn’t have a Wrecking Yard License (fairly stiff fines). They were saying that they were selling parts, not cars? (The Patrol wasn’t in agreement over that / off the record). I don’t know what I’d deal with since I’m also a licensed Body Shop? The other question becomes what if I took one of my parts cars parts off and put them on a Body Shop customer’s car. I’ve done it a few times and it isn’t unusual to buy used parts from wrecking yards for customers car’s repairs. I list them on my Body Shop invoice. I had one customer buy a car himself from the Salvage Auctions, then paid my shop to fix it. I helped him during his inspection, went with him. I had all the invoices where I got the parts from, plus had his Body Shop repair invoice from me for the car. The State Patrol ignored my part invoices and accepted my Body Shop receipt as proper documentation of where he got his parts. So how does that fit in with the other DOL guys?
The one thing I do not do is sell major parts over the counter. I only put them on vehicles.
Legally flipping cars is a can of worms. It’s also a financial risk, which is why I don’t do it anymore, other than an occasional old car. There’s honest dealers and not so honest ones, the same with Curbstoners. The question is are you willing to accept the risk. But really it’s what are you going to do when you get burned with a problem car. It happens to all of us. When I took classes for my Dealer’s License (yes, had to take a seminar to get it), they said, with a car lot, it’s not of a question of if, but when you have a car stolen. A few years in, I had 2 cars stolen within 3 weeks, both Honda Accords. Got one back, never got the other one back (over $3k hit cost).
Also had at least 3 cars come through that turned out to have Odometer problems. I was dealing with cars over 10 years old, so the Odo statement isn’t required. I had every car safety checked by a mechanic shop and oil changed and they didn’t pick-up on the fact that there was a little mechanics sticker on the timing cover stating mileage when timing belt was done that didn’t match the odometer on the car. two times more than a 100,000 mile difference, found out after the car had been sold. Had other cars that had either a bad cam-shaft or blown head gasket; found out one or two days after they bought the car. Both cases I did a “good Will Of Sale Service” / not a warranty, repair. Cost around a $1000 each.
Also had a car come in that had some minor damage on the front. I bought it from pictures on the salvage auction web site, didn’t go look at it personally. When the car got here I found that it had had previous damage repairs that had involved the frame and blown the airbags. Whoever had fixed that cut out the airbags and glued the airbag covers back together. Obvious up close, but didn’t see that in the photos. I had paid way too much for that car, thinking I was going to repair it, and just parted it out. Did not want the liability of putting that one on the road. Lost around $1000. on that one.
How are you going to handle these things. Some guys (and lots of licensed dealers) just ignore it, sell it, and claim ignorance later. Being a Body Shop, I also had more responsibility, since I’m an expert in body damage.
I had one used car dealer buy a couple of cars from auctions, then put new tires and have alignments done on them, only to find that they can’t get an alignment due to prior frame damage. The tire shop sent them to us, we’d have to pull the frame enough to get it to align up (much more difficult to do when the sheet metal is on the car and painted). Our invoice would state prior frame damage, etc., but the dealer just put them on their lot and sold them. Could be an issue later if a problem shows up, because there is documentation that the dealer was aware of the problems.
Flipping cars is tough. If you really like it, then you might consider getting the licenses and doing it right. The risks can be huge. It’s like Jaywalking, not a big risk and not a big cost if you get ticketed. Drinking and driving, a huge risk; you could kill someone or just a ticket can cost upwards of $10k. Selling a car where the airbags don’t deploy or a wheel comes off on the freeway; again a huge issue, just ask GM. There’s way more involved than just a license.
dang that’s a lot of complaining
I have done this for years. ‘In demand cars are different from city to city and state to state. One thing have done is find vehicles that are not in demand in Dallas like foe expedition 4×4 that need minor repairs and brought them here to my area where they are in demand in rural east tx. I have purchased them for as low as 1000 and sold it here for 2500 with only 300 in repairs.
I flipped 1 vehicle so far and it was a fun and rewarding experience. I bought a truck on Craigslist that was priced well below private party value, even under trade in value! It was priced at 5500 on cl trade in was 6500 on kbb. So I went and test drove it, it ran and looked good. It had real low miles on it. I knew I could sell it for more. Bought it that day for 5300 cash. Plus about 300 for title transfer. I drove it for about 3 months before I re posted on Craigslist. I sold the truck for 6800 cash. I could’ve got more if I waited it out but sold to 1st buyer. The truck never gave me any problems and I didn’t have to repair anything besides changing brake pads and fluid and oil change ofc.
There is nothing illegal about buying something including cars and selling them for a profit. I have done this for hundreds of cars. Yes you do need to title them in your name so make sure you know what that will cost and how long that will take to process. Which a simple call to your local dmv will tell that info. So make sure you have the funds to sit on it for that period of time. Having multiple cars can give you the opportunity to sale on a more consistent basis. Above all don’t lie about how long you have had it tell them the truth. If the car was a pos and now it is like brand new them tell them that. You. UI value that way. Much like this situation. So how long have you had the truck? I just purchased this truck from a gentleman who no longer needed it. It had a bad trans and a shimmy in the front end. I put a new trans in and rebuilt the front end now it it drives perfect. By the way here is my paper work for the work I did. Also here is list of other work that I have done to it as well etc. Etc. This works for me well in fact I get calls from time to time of repeat customers because they know I buy and sale all the time and I don’t misrepresent the car.
It works cheaper more fuel efficient cars are always in demand, to those haters and sceptics commenting dont put it down untill you have tried and failed.
I love selling & buying cars-yes there is money to be made only if you do the right thing…
Its a great way to make extra money. My husband & his brothers both flip cars. I dont have to work because of the extra money & my brother in law just bought his first house. You just have to know what your doing!!!!
Matt
It makes no spense what u said .. If a person buys a car low and sells for retail you always make money .Exept for the people that drive into a dealer and pick the pretty car out front and then yep worse investment to make because they spent a hour doing it and deserve to lose the money if they cannot look for a deal there out there every were
When you buy it right you can drive it 7 or 8 months and have a free car to drive and enjoy the change and then sell it and drop 3 or 4 grand profit into your pocket . I had a friend that would need to get one off his lot before a payment was do so he would drop it on me at cost and he had paid to get it to the lot and a mighty fine detail job and I bought it whole sale . Last one was the CST had a ball in that car . I drove it for a year and made 3 grand . Yep if I sold it on the spot I could have made 4000 .. I figure 25 bucks a week to drive a luxury car is ok since I never had to pay anything ..
I liked to buy one in the summer and sell in the winter when work was slow ..
So to the person that wrote the article thank you it helps others out there wanting to make a buck here and there !!!
If you are a person not lazy there are super good deals and go by craiglist price not nada that is for dealers and a good way to talk the owner down in price .. Have him look at the price of other cars and if he needs money you have just bought a cheap car to drive and make cash… You could make a living on craigslist buying and selling ..
Flipping cars for a living is the most dangerous business you can do, I bet you lose most of the time.
Great tips! Especially number 4. The car needs to look good even if it used! Nobody wants to buy something in a lesser condition.
It’s actually easy. Iam a girl that flips full time. Around 20k per month.
I buy cars under 2000
Approx profit 1000 per car. I love what I do.
Mandy Im just curious are you still flipping cars?
Matt H. Obviously doesn’t know cars.
I’ve bought cars for $8k, driven them a year and sold them for $10k
It’s all about finding motivated sellers and targeting enthusiast markets. Extremely low risk.
Clearly this person ^ has no idea what a car is. I’ve been in the auto industry for 10 years all I got to say is I drove free for the past 3 years.Level 2 mechanic, detailed and sold cars a while back. Bought a Camry for $2000 in 2012 and sold it for $2400 in 2015. You need to know the business and the good cars and most importantly what your doing. I made $400 in 3 years while most donkeys pay $400 in a month or 2 of payments. Hahahahaha
That’s probably the worst, uneducated comment too Matt.
Yes flipping cars is risky and can take a while to make a worth while profit, but from personl experince its great fun if you know what to look for, you dont want to buy a lemon and pay for repairs that cost half the price of the car itself, so dont rush to buy take time to evaluate the car inside and out.
I own a shop have vehicles all the time I buy cheap with bad transmission So will rebuild the transmission with warranty wet sand and buff the car new brakes battery’s tires and they sell within a week net 3-4g per unit and people Get great vehicle You just have to understand how to flip a quality car quick and on to the next
can anyone tell me if you need to register a car when it is only going to be parked in my driveway to be fixed. my dad is giving me his old car so i can work one it. and i was wondering if it needs to be registered. i dont have a drivers licence. and i live in massachusettes. ?