How to get paid when you sell a car
The car and the title should leave only once the money is yours, and a payment that has appeared in your account is not always money that will stay there. Which ways of being paid hold, which can be pulled back weeks later, and what the regulators say about each.
Agree how you will be paid
Before the day, in writing
Meet where the money is
At the buyer's bank, if you can
Wait until it has settled
Not until it has been sent
Then sign over the title
With a bill of sale for each of you
Why it matters
When a payment is really yours.
A deposit can show up in your account before your bank knows whether it is good, and that gap is where private sellers lose cars.
The FTC puts it plainly: by law, banks have to make deposited funds available quickly, and seeing the funds in your account does not mean the check was good. A fake check can take weeks to be discovered, and by then the person who gave it to you has the car, while you are left paying the money back to the bank.
The OCC, which supervises national banks, says the same from the bank’s side. If your bank credited your account, it can later reverse the funds if the check turns out to be fraudulent, and as the payee it is generally up to you to pursue the person who gave you the check.
So the question on the day is not whether the money has arrived. It is whether anybody can still take it back, and the rest of this page is about the ways of being paid where the answer is no, and the ones where it is yes.
Cashier's checks
What a cashier's check does and does not promise.
It is drawn on the bank rather than on the buyer's account, which is why sellers trust it, and why it is worth copying.
Drawn on the bank
A cashier’s check is drawn directly on the bank that issues it, not on the buyer’s own account. Generally the buyer cannot stop payment on it, and the bank must honor it when it is presented.
Available quickly
Deposited in person with a bank employee, a cashier’s check is generally available by the next business day. When cashier’s checks deposited in one day add up to more than $5,525, the bank can hold the amount above that, and it can hold the whole check if it has reasonable cause to believe it will not be paid.
Read on helpwithmybank.gov on 18 October 2026.
Available is not verified
The OCC adds that the funds may become available before the bank has been able to verify the check, and if the check is fraudulent, the bank may take the money back out of your account.
Copied well
The FTC lists cashier’s checks among the fake checks scammers use, and says fake checks look just like real ones, even to bank employees, often printed with the names and addresses of real banks.
That is why the cashier’s check worth taking is the one you watch a teller issue at the buyer’s own bank, made out to you. If the buyer arrives with one already printed, go with it to the bank that issued it, or call that bank on a number you looked up yourself: the number printed on the check was printed by whoever made the check.
The overpayment
The check for more than the price.
The FTC describes this one by name for people selling a car online, and it works because the fake check looks paid.
A buyer gets in touch about the car but is not local and cannot see it. They send a check as a deposit to hold the car, and it is for more than you expected. They say they overpaid by accident and ask you to send back the difference. If you do, the FTC says, the buyer and the money are gone, because every part of it was invented. The funds may even show up in your account first, and when the bank finds the check was fake weeks later, it takes the money back, so you repay the bank as well.
The FTC’s advice is short. Do not accept a check for more than the selling price. Never send money to anyone who says they overpaid you by check, and never use money from a check to buy gift cards, money orders or cryptocurrency, or to wire money, for anyone who asks: once you do, it is like handing them cash.
If it has already happened, tell your bank straight away. The FTC lists three places to report a fake check: the FTC itself, the U.S. Postal Inspection Service and your state attorney general. The same pattern, with a shipper in place of the overpayment, is on selling a car safely.
Apps and escrow
Payment apps, online payment services and escrow.
For a sale arranged online, the FTC suggests considering one of these, and what happens to the money once it arrives is the part to plan for.
In its warning to car sellers, the FTC’s last piece of advice is to consider using an escrow or online payment service when you sell a car online.
Money sent to you through a payment app does not go straight to your bank account. The FTC explains that it is added to your balance in the app, where you can leave it or transfer it to your bank. The CFPB adds that FDIC insurance generally does not apply to money that sits in a payment app, unless you have signed up for additional services, and that the straightforward way to keep it insured is to move it promptly into a bank, credit union or card account.
Three things follow for a car. Choose the service yourself, not one the buyer sends you a link to. Read what your service says about large payments before you agree to use it for the price of a car. And hand over the car and the title once the money is in your bank account, not when the app shows it in your balance.
Other ways to pay
Cash, a bank transfer and a personal check.
Three more ways a buyer may offer to pay, and what decides whether each one is safe to accept.
Cash
It cannot be pulled back once it is yours, which is its strength, and a large amount in a parking lot is its weakness. Meet at a bank and have it counted at a teller window, then deposit it there and then.
A transfer at the buyer’s bank
Sitting with the buyer while their bank moves the money, or issues a cashier’s check in your name, is the payment you can watch from start to finish. A promise that a transfer will arrive is not a payment until your own bank shows it settled.
A personal check
It is drawn on the buyer’s account, which can turn out to be empty, closed or not theirs, and the OCC says a bank can reverse a deposit of a fraudulent check after crediting it. The FTC’s rule of thumb is not to rely on money from a check unless you know and trust the person who wrote it.
The handover
The order on the day of the sale.
Money first, then the paper, then the keys, with nothing out of that order.
Before the day. Agree how you will be paid, and where. If a deposit is part of the deal, the private car sale agreement puts it in writing with the price and the handover date, and it should be paid in a way that clears.
At the bank. Meet at the buyer’s bank where you can. If there is a loan on the car, the lender’s branch is better still, and how the payoff fits inside the sale is in selling a car you still owe money on.
Once the money has settled. Sign the title over where your state’s title tells you to, and sign two copies of a bill of sale with the price, the date and the odometer reading, one for each of you. Only then do the keys change hands.
A buyer who cannot come in person changes the logistics, not the order. How that works, from the plates to the trip home, is in selling a car to a buyer in another state.
Read next
The rest of the sale, once the money is settled.
Getting paid is one step of a private sale. These cover the price before it and the safety around it.
The whole process, in order: how to sell a car privately.
- How to negotiate when you sell a car privately
How to hold a price without being difficult: what to decide before anybody calls, how to answer the opening lowball, and the point where walking away is the right move.
- How to sell a leased car
You cannot sell a car you do not own, so a lease sale is really a buyout followed by a sale. How the numbers work, and why your lender may not allow it.
- How to sell a car that does not run
A car that will not start still has three kinds of buyer and a real price. What to find out first, what to disclose, and how the handover works without a test drive.
Frequently asked questions
Is a cashier's check safe when you sell a car?
A genuine one is drawn on the bank, and the bank must honor it. The risk is a fake: the FTC says fake checks can look real even to bank employees, and the OCC says the funds may be available before the bank has verified the check. The safest one is issued by a teller at the buyer's bank while you watch.
How long does it take to know a check is good?
Longer than it takes for the money to appear. The OCC says a cashier's check deposited in person is generally available by the next business day, and the FTC says a fake check can take weeks to be discovered. If it was fake, your bank can take the money back out of your account.
Can I take a payment app or escrow for a car?
For a sale arranged online, the FTC suggests considering an escrow or online payment service. Choose it yourself, check what it says about large payments, and move the money to your bank before the car leaves: the CFPB says money held in a payment app is generally not FDIC insured.
What if a buyer sends a check for more than the price?
Do not accept it, and do not send the difference back. The FTC describes this as a scam aimed at people selling a car online: the check is fake, and when the bank discovers it, you repay the money.
Where do I report a fake check?
Tell your bank first. The FTC lists three places to report it: the FTC at ReportFraud.ftc.gov, the U.S. Postal Inspection Service and your state attorney general.
Agree the price on the page, take the money at the bank.
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