Buying a Car Interstate: How to Manage Payment Risk
An interstate vehicle purchase creates payment difficulties: the buyer may be asked to pay before physically taking possession, while the seller wants confidence that the money is secured before releasing the vehicle.
Why interstate car purchases create extra payment risk
Distance can make inspection, identity checks, ownership checks, transport and handover harder to coordinate. A direct transfer before those steps are complete, can put substantial payment risk on the buyer; handing over or transporting the vehicle before payment puts risk on the seller.
A safer payment sequence
- Verify the seller and vehicle independently. Does the seller own the vehicle?
- Arrange appropriate inspection, registration, encumbrance and ownership checks.
- Agree on the price, transport or collection arrangements and handover point.
- For an eligible transaction, create a GoEscrow transaction and fund the agreed amount.
- The seller independently verifies that the transaction is funded via GoEscrow’s app interface.
- Complete the agreed handover or transport step.
- Authorise settlement in accordance with the transaction details.
Do not treat escrow as a vehicle check
GoEscrow does not inspect the vehicle, establish ownership, check mechanical condition or guarantee the seller. Those checks remain the buyer’s responsibility. GoEscrow’s purpose in the transaction is to hold the buyers funds while the vehicle changes hands. Once the handover is complete, the buyers funds can be released to the seller.
What should the seller verify?
The transaction status, and funding stage can be checked by both the buyer and the seller in the GoEscrow app. The seller should independently check the GoEscrow transaction status rather than relying on a screenshot, email or message presented by the buyer. Any form of transaction confirmation the does not come directly from the GoEscrow app, or the GoEscrow team can not be trusted. For more information about fake confirmation scams, see this page: Fake Payment Screenshots and Bank Transfer Scams: What Sellers Should Check
What if transport is involved?
The parties should clearly agree on who arranges transport, what constitutes handover, and when settlement is intended to occur. Escrow manages the financial interaction; it does not operate the transport service. If the seller wants to be sure that the buyer has the capacity to pay for the transaction before transporting the vehicle, they may agree with the buyer to fund the escrow transaction before transportation occurs. This way, the seller can see that the funds are actually ready for release before committing to transportation of the vehicle and any costs associated. If this is the case, the buyer and seller should include all relevant detail about transportation in the transaction details (in the GoEscrow app interface).
Related information
See How to Pay Safely When Buying a Car Privately and How to Receive Payment Safely When Selling a Car Privately.
Frequently asked questions
Can I use escrow for a private sale?
Escrow can be useful where a buyer and seller want payment funded before goods are supplied, without requiring the buyer to pay the seller directly before the agreed handover or inspection conditions have been met.
What if the buyer sends me a screenshot of payment?
A screenshot is not the GoEscrow funding confirmation. When GoEscrow is being used, the seller should rely on the transaction status in GoEscrow and wait for confirmation that the funds are in escrow before handing over or shipping the item. see: Fake Payment Screenshots and Bank Transfer Scams: What Sellers Should Check
Does GoEscrow check the car I’m buying?
No. GoEscrow manages the financial interaction. It does not inspect or supply the goods (in this case, vehicle) and does not independently verify their quality, condition, authenticity, ownership or title.
Who says the funds can be released to the seller?
The GoEscrow product is designed around payer-controlled settlement: once the applicable conditions are met, the payer authorises settlement and GoEscrow remits the funds to the payee in accordance with the transaction and its terms. GoEscrow transactions can be organised with a variety of settlement conditions which should be tailored to the specific transaction at hand.
What happens if buyer and seller disagree?
The funds can remain in escrow while the matter is addressed under the applicable GoEscrow cancellation or dispute process. The outcome depends on the circumstances, party instructions and the GoEscrow Terms of Use; using escrow does not guarantee a particular dispute outcome.
Can GoEscrow be used for an interstate private purchase?
Where the transaction is eligible, GoEscrow can be useful for interstate purchases. Escrow can separate confirmed funding from later shipment, inspection or handover, which may be useful when buyer and seller cannot meet in person.
Learn more
Read Escrow Services in Australia, Escrow Accounts in Australia and Safe Payment for Private Sales.
Ready to protect the payment?
Use the official GoEscrow mobile app or web app to start your transaction. Review the transaction details, fee and applicable terms before funding.
For formal information about the service, see the Product Disclosure Statement, Financial Services Guide and Terms of Use.
