Flipping Cars For Profit – Step-by-Step Guide [Updated for 2021]


Flipping Cars For Profit

Cars are definitely special. Almost every family relies on one and they draw on people’s emotions and create desire. Also, they are expensive. It is because of these reasons why flipping cars is extremely popular and why it’s worthwhile if you know what you’re doing.

There is something taboo about flipping cars and mostly that’s carried from the perception that all car salesmen are sleazy and not trustworthy. Not true. This guide will teach you how to get over that perception and how flipping your car for profit can be rewarding, easy and fun.

Flipping Cars For Profit

How much money is required to get started?

The magical question most people are curious about. In my experience, the used cars you can buy between $1,500-$4,000 are the least risky and fastest to sell.

For some, this is a large investment. If you don’t have the startup capital to do this then you should probably start saving. You should definitely start flipping smaller items and build up your bank. Luckily Flipping Income has a ton of ideas for you to explore. 🙂

Cars between the range of $1,500-$4,000 can net a profit of $1,000-$2,000 profit. That is serious money and serious profit margins for a single flip. This is why flipping cars is so popular. Compared to books, electronics, clothes or anything else…nothing comes close to cars with the exception of houses.

Where do I go to find cars?

When flipping cars in the range of $1,500-$4,000, you’re going to be doing all the buying and selling on Craigslist. Why?

Simply because places like Autotrader.com, Cars.com, and eBay Motors charge people that want to list their car for sale, and the fee isn’t cheap.  However, Craigslist charges only $5 dollars.   And obviously, when listings are free, you will see a huge inventory of cars being sold for under $4,000 on Craigslist.

Another benefit is that a large majority of people selling on Craigslist are less tech-savvy and aren’t aware of other services that can help bring in more money. This is crucial because you’ll be utilizing this lack of knowledge to your advantage.

To get started, simply navigate to Craigslist.org, find your city and then go to the cars+trucks section under the for sale category.

Tip: There are a few options I recommend you to select when searching. First, check By-Owner only because you don’t want to deal with dealers. Unfortunately, some shady dealers still do hide their listing under “By Owner only” but more on that later. Second, check Search titles only because many sellers include a lot of tags and it results in bad searches and lastly sort by lowest price.

Another place that has become popular with car buying and selling is Facebook Marketplace.  And that’s because everything is free.  Craigslist used to be entirely free but now only Facebook Marketplace allows you to deal without worries about fees.  However, there is a catch.

Everyone has a profile and sometimes you want to deal in private.  There could be a chance that buyers or sellers might come back to contact you if they feel like they’ve been ripped off or due to regret.  Also, users on Facebook Marketplace is more tech-savvy and might be less willing to negotiate.

So I would say use both Craigslist and Facebook Marketplace and see what your experiences are.   You are not limited to one or the other, simply utilize whatever works for you.

Private sellers vs dealers?

Now as for private sellers (“by owners”) vs dealers, ONLY buy from private sellers.

Why don’t you want to make deals with dealers? First is because of taxes. When you buy from a dealer, you are obligated to pay full retail tax on the car. This is hundreds that cut into your profit margin. Second, you’re dealing with a pro at haggling and selling cars and you aren’t going to get a bargain because of it.

Unfortunately, there are a lot of dealerships and private dealers that pretend they are private sellers and will not indicate who they are in the posting.

There are some tells which indicate if the car is a dealer’s car. For example, if they remove the license plates, have a weird looking license plate (like DL plates mean dealers license), and if the listing is too professional looking.

To be sure always ask up front if they are a dealer or private seller. Most are upfront, some might dance around the question and some might ask you why you care. In all instances, avoid.

What am I looking for?

There are hundreds of car brands, models, and styles out there so this may be difficult for someone starting out. Picking which brand or model or year is based on your own preference and over time you’ll get more and more familiar with what you have selected.

The easiest is to start with what you know. If you’ve owned a Civic or a Malibu for years, you’ll probably know a thing or two about them. These would then be cars you would start with. The problems you’ve faced, the maintenance routines, the quirks that others won’t know about…you will. Use this to your advantage when looking and when negotiating.

Once you feel like your comfort level reached a certain point then feel free branch out. For example, say you’re familiar with Toyota 4Runners since you’ve been driving them all of your life.

How do I determine the right price?

How do you determine what a car’s true value is? If you’ve ever traded in a car, you probably heard of auction prices or Black Book pricing. These are tools that normal people do not have access to. Auction pricing and Black Book pricing are more or less what a dealer is willing to pay for your car EVEN if you don’t buy theirs. This is how CarMax operates as well, although generally, they go a bit lower than even what “auction” price is.

This is the reason why you always seem to get ripped off when trading in your car, especially if you researched the trade-in value online.

Let me show you how you can determine that value yourself utilizing Kelly Blue Book.

Now, this method is not 100% but it is close. And the reason I know it’s close is because of the dozens upon dozens of cars I’ve flipped over the years.

After you’ve found a car, head over to Kelly Blue Book and then click on check my car’s value. Next enter the year, make, model and mileage. Next, you’ll be prompted for your zip code, the style of your car (sedan, coupe, etc..) , the options and condition. Fill those out honestly and select fair as the condition.

Finally, you’re prompted with a screen that tells you what your trade-in range is and they give you a price right in the middle of the range. The reason why I asked you to select fair as the condition is because it drops the price to the point where it’s very close to what auction pricing would be.

Now you have a baseline of what you want to get the car for because it is the same amount dealerships would be paying for it. But just because you know what the auction price doesn’t mean you should be buying at that price.

What you’re aiming to buy the car is $500-$1,000 below that fair trade-in price. Let that sink in for a bit.

The mission is to try to buy cars below auction pricing to maximize profits and to reduce risk. For whatever reason, if you can’t sell the car you can always bring it to CarMax and break even or even make a few hundred over what you’ve paid.

However, most of the time if you are able to achieve this and there are no hidden surprises, this is how you can net $1,000-$2,000 dollars per flip.

How do I find the right seller?

This is definitely the hardest part to flipping cars. Finding the right seller. Basically, you are trying to identify sellers who are either desperate to sell, too lazy to try other methods or simply don’t know what their car is worth.

This is actually relatively easy to determine without ever showing up nor calling the seller directly. Do it by text.

The reason is you don’t want to be wasting your time driving to all these sellers without knowing if the deal can be done. You want to determine that prior to arrival. And over the phone, things can get heated due to your offer. With text, there is a lot less emotion from both sides and you can be talking with several sellers at once. Lastly, text allows you to have a long negotiating process that lasts several hours or even days.

Once you’ve texted the seller, see how responsive their response is. Generally the faster the response the better. Start the conversation with little talk, ask about the condition, if there are any issues, large repairs that have happened recently, etc… unless they respond that there are major issues like the transmission won’t shift or there are loud noises from the engine, their response isn’t that important.

The small talk is meant to hook them and get them comfortable. It makes your offer go over much better because most people will be shocked or even outraged by it.

Once the small talk is done, lead to questions about how flexible they are with pricing and how soon they want to sell the car. This is where it starts to get fun.

Generally, most people will say they have little wiggle room or they have other interest. It doesn’t matter if that is true or not. Now it’s time for you to tell them directly what you want to pay for the car and see how they react. If they end the conversation then you know they are not the right kind of seller.

However, if they continue the conversation on with a lot of back and forth that’s generally your tell that you got them on the hook.

Your base of argument from you is that you can pay with cash and make it a fast transaction. Tell them if they agree, the deal is done and you will not be negotiating anymore in person (unless there is damage or problems not disclosed). This might go back and forth but keep emphasizing the same message.

Tip: For newcomers, you want to stick with negotiating with one car at a time. But as you get more comfortable with the process, you can be negotiating with 2 or 3 or more sellers at the same time.

Eventually, after they cave in and agree, pat yourself on the back!. You’re on your way to a big payday.

Before you get too happy, there are a few things you still need to do. Ask the seller to give you the VIN (Vehicle Identification Number) number of the car so that you can do a CarFax. Then schedule a time to go see the car.

Tip: If they are desperate enough, a lot of times you can ask them to meet you at your house so that you don’t even need to drive anywhere. This makes it easier for you since you don’t have to bother someone giving you a ride.

Do I need to get a CarFax?

Yes absolutely! Carfax is a car history service that shows you if the car has a clean title, the exact miles of the car, all of the previous services from a dealership and if the car passed the last emission check.

First and foremost check to see if the car has a clean title. That means to make sure it does not have a rebuilt or salvage title. If the car does not, leave right away.


If you do, it is the surest way for you to lose money.

Tip: Sign up for the unlimited plan, it is much cheaper than paying for every VIN check.

Now after you run a Carfax and the car is clean, then proceed to go check out the car. If the Carfax comes back with something fishy or not right, for example, the miles are off, then move on. Remember that the value of the car greatly diminishes if the car has an unclean title or mileage tampering. Just don’t mess with them.

How do I inspect a car?

After you show up at the seller’s place (or if you convinced him to meet you at yours), make sure you test every little thing on the car. Every power window, every button, every feature, every light, etc..

Trust me buyers are going to be picking out every flaw from you when you try to sell it later on so this is your opportunity to do the same.

There are a lot of things that can be hidden but there are a few obvious things you can look for. Visually inspect the car for rust, dents scratches…and then move on to under the hood and driving.

  1. Check the oil level – Make sure it’s not low or dry. And also inspect underneath the car. Are there oil stains? If there is then that means the valve covers have bad gaskets. This is not a deal breaker but make sure it’s not leaking like crazy.  A few drops are not preferable but tolerable.
  2. Check the transmission fluid – Check it from the dipstick and make sure it is pink and should not have any metal particles or shavings in it. If there are that means trouble. Stay away.
  3. Listen to the engine – there should not be any knocking or shrills. If there are, see if the knocking gets worse as you accelerate. If there is then stay away.
  4. Feel the shifting – when you’re driving pay attention to how the car shifts. If it seems the car is shifting weird in any way then there may be transmission issues. Stay away.
  5. Check everything that has power in the car – this includes all the windows, wipers, heated stuff like seats & mirrors, seats, locks, sunroof, radio, instrument panels, headlights, taillights, interior lights. Every little thing adds up to repair. Make sure you know what you’re getting.
  6. Ask about service records – some guys keep really good records and that’s great. For those that don’t, you can find a lot of this info from Carfax. The most important for most cars is the 100k mark where the timing belt and water pump should be changed. But not all cars have a belt, some use a chain which lasts over 200k miles. Do your research on google first to see if the car you want to buy requires a belt change and see if the owner can provide some kind of proof if it was replaced.

Depending on how serious the issues are, you will have to make a decision if you still want the car. For me, if the issues aren’t too bad then I just live with it and still make the transaction. If the issues are somewhat serious then I negotiate further.

Tip: If there are minor issues found, they can be used as a bargaining chip.  Negotiate with the seller more.  Pick up a Chilton or Haynes repair guide for the car in question and fix it yourself.  Sometimes the work takes only a few mins but it could save you hundreds. 

Know when to get out, do not let emotions cloud your judgment.  If the car is a dud, don’t try to pick it up thinking it’ll be a quick flip.  For example, if there is engine knocking or shifting problems, walk away.

How do I make the purchase?

If everything looks good and you’re comfortable moving forward,  focus on the paperwork next. Make sure the buyer show you the title and you verify they sign the seller’s part in front of you. Make them show you their ID so you know the car is from them. If the title is already signed then just check the ID. The reason for this is you don’t want to be buying a car from someone who didn’t title it.

Don’t buy a car from someone whose name is not on the title because there could be some legal ramifications behind this.

Along with the title make sure you get some sort of bill of sale written and signed by both parties. That way you can drive the car home without a license plate and if you get pulled over by the cops you can explain why.

The bill of sale should have the description of the car, the sale date, sale price, and have the VIN number listed.

If everything is good, shake hands and give them the money. Lastly, before you leave, make sure to get every key, service documentation, manual from the seller and then hand them the cash to complete the deal.

How do I sell the car?

Now that you have a solid car for an unbeatable price, it’s time to flip it for maximum profit.

Fix it up

It goes without saying, the car selling process will go smoother when there are fewer issues.  Fix up anything that you can.  Loose trim pieces, fix it.   Broken dome lights, fix it.   Headlight or taillight bulb out, fix it.  And make sure the key fob is working.  If it isn’t, could be just the battery.  Use DIY videos to help you replace the battery in a jiffy.

Clean it up

Wash the outside and clean the inside. Don’t spend money on detailing it, just use some elbow grease and get rid of all the gunk and food that accumulated over the years. Vacuum and if the carpets are too dirty to wash clean then buy some cheap carpet guards from Walmart and lay it over it. You don’t have to make the car spotless (it doesn’t hurt) but make sure that the obvious is done to clean it up so that it’s in presentable shape. An air fresher also helps.

Take quality pictures

First impressions make a huge statement so make sure your posting pictures are quality and spot on. Don’t showcase the flaws but also don’t hide it. The buyer will be inspecting the car in person so if you have a big dent on a door, then just be honest and present it. Don’t try to be shady and cover it up. Make sure the pictures show the highlights of the car including any special options that the car may have. Showcase the tires if they are new. Make sure to draw the buyers in with your pictures.

Research price

Find the average listing price for your car by looking at other similar cars being sold on Craigslist. If you want your car sold fast, then list it on the low end. Don’t price your car at a premium unless you know for a fact that it’s better. Use year, miles and features as the main points for price comparison. if you bought the car below auction price you’ll make money even if you price it on the low end.

Create the listing on Craigslist or Facebook Marketplace

Use a descriptive title with the year, color, make, and model of the car and be as detailed as possible with the description. Make sure you put up any service record you have and Carfax so that buyers are comfortable making the purchase. Put up the quality pictures you took and explain the flaws if there are any.   Again draw the buyers in with your listing.

Don’t be afraid to list your number. Most people on Craigslist do not want to deal with slow emails. If you don’t want to pick up calls from random people then put in the auction that you want people to text only. If they call you, don’t pick up and simply text back. I do most of my negotiations this way.

But there will be people who only want to talk over the phone, so be prepared and get comfortable.


When selling the car, you want to do the opposite of what you did when buying the car. When negotiating, always try to convince the buyer to come and do it in person. This is because you want people to make decisions based on emotions or impulses. Try not to negotiate over text or the phone unless you have no choice. Never get heated with negotiating, think of it as a game.

Get ready for the sale

After you have scheduled a time for the buyer to come out and take a look at your car, make sure you get everything ready to make the process as simple as possible. Have all the keys, service documents, Carfax ready. Also have towels and rags around in case the buyer wants to do an inspection on the car. Lastly, have the bill of sale ready so that it can be filled out quickly, and lastly have the title ready. Remember to make the process as easy as painless for the buyer.

Don’t act desperate, don’t hide things, and above all else be nice.  This will change the sleaziness perception most people have about buying a car and trust me it goes a long way.

Make the sale

If all is good, go ahead and make the sale. Collect the money, sign the title and bill of sale, and make the buyer do the same. Shake hands and wave goodbye.  Enjoy your massive profit from a single flip!

State Limits

Every state has a different law that states the number of cars a consumer can buy and sell within a year.  Make sure you find out first before attempting to flip a car.  Some states can be as low as 1-2 while other states have no limits.

If you cross the number, the state will then deem you to be a dealer and you don’t want that status!  Check with your local DMV to find out what that number is exactly or Google it!

In Conclusion

Flipping cars for profit is definitely one of the most profitable ways to make money outside of flipping houses. The investment is a little higher than what most people are comfortable with but the rewards make it well worth it. Be sure to take your time and follow these steps carefully to ensure that you don’t rush to a mistake. Of course, if cars are just not your thing or you can’t afford it yet, there are plenty of other things (Legos, Bitcoin, Clothes, Thrift Store Items, Dollar Store Items, more) you can flip for money.

BTW,  check out 5 Automotive Products To Sell from Dollar Tree that you can flip for side money and plus there are some great products you can use on the cars you do buy. It’s a win-win situation!


40 Replies to “Flipping Cars For Profit – Step-by-Step Guide [Updated for 2021]”

  1. My question is. Do you have to transfer the title to your name when you flip it? That would cost some money and how would you explain it to the buyer that the car is not titled under your name when they ask for your ID when flipping the car. Thanks a lot

      1. What if the driver is uninsured?

        You didn’t answer the question. What about insuring the car after I buy it? Don’t I have to insure it to get it registered and plates?

        1. Check your state but in mine, all you need to do is show up with the title to get the car plates. Easiest is to go to a currency exchange to do this rather than a DMV. You only need to get insurance if you are afraid the car will get stolen or if you need to drive it.


        1. It depends on the state. Some states follow the vehicle, others follow the driver. Also note, if it follows the driver and they dont have comprehensive insurance you could be in trouble if something happens.

      1. Where are you from? Currency exchange is not a place to transfer titles in any of the half dozen states I’ve lived.

  2. I live in Texas. What about paying for the sales tax of the cars I buy, along with the plates and title transfer. Do you also work in this cost, when trying to buy and negotiate down the price from the original seller?

    1. Sales tax on cars that are not by dealers are much cheaper. You’ll have to find the rates from your local DMV. Of course you have to figure that into the cost and make sure that you still have enough profit flipping the car.

      1. In Washington state you pay sales tax PLUS an additional surcharge. Currently that is 10.4%. Not trivial by any means

  3. First off, thank you so much for this! Tremendous lifesaver for beginners or pros ! Straight to the point with no bullshit !!
    With that lol….., a couple questions.
    So we want to ask for the VIN after we negotiated our seller to the lowest price ?
    What if the person is “keyless” ? -* the ad is stating that; their “keyless , make them an offer. Don’t need to sell but don’t need the car.”

    Thank you so much for your response ahead of time !

    1. Thanks for your kind words! You can ask for the vin before or after, it doesn’t really matter. You just got to make sure you are not getting a lemon before you take the car. I took a risk once on a bmw that was keyless, the only reason I took a chance is because I got it for extremely cheap. A $10k car for around $3k. You have to get the car for extremely low otherwise you might end up with a lemon. You won’t know if there are engine problems or transmission problems until you can turn on the car and drive it.

  4. It’s so difficult to get into flipping cars here in Dallas, TX because you are competing with dealers who have two trucks circulating at all times of the day or night and they have people being PAID to watch for used car postings on Craigslist and as soon as a new posting happens they start calling the person and in a few minutes tops they can have a tow truck and money over to the person to buy the car and drive it off. I know because I sold my car on Craigslist and about 3 minutes after it was published on craigslist my phone was ringing off the hook with calls from people (many of whom were dealers without letting me know) asking me to buy my car. They do this for a living. They also lowball because they figure they have cash in hand and the person selling the car may be on hard times and will jump at the first cash offer they receive.

    Almost every industry now where there is quick money to be made is flooded with people trying to make money off it it. So this may work in a smaller area but certainly not in DFW.

  5. What about limits. Most states limit an individual from selling a certain amount of cars per year without a dealers license. For instance Ohio limits you to 5 per year.

  6. Hey I am going to get started with this business but I have a few questions regarding the laws. Or whatever. So all I have to do when I purchase a car is just get the title transferred to my name by going to a currency exchange and then it’s under my name right? So let’s say I have my daily driver. And when I post it for sale and a buyer wants to test drive the car around the block can i just swap out my daily driver plates to the car that is being sold to the buyer ? I mean it’s just like 3 blocks away. Sorry for the overwhelming question…

  7. Hi, really appreciate this article. Have a question if you can answer it. I have been going through a lot of Craiglist listings and when i check the vehicles trade in value on Kelly Blue book, it comes out to be approx $1200-$1500 but the asking price by the seller is $4000-$4500. How is it possible to make the seller come down to a price even less than the KBB Trade In Value, specially when the KBB Value is lets say $1500? I will be actually asking the seller to sell the car to me at $1000.

    1. Most people overprice their cars and some just won’t budge. But others will and they list high on purpose because they know buyers will negotiate. Just depends on the seller. Got to keep trying to find the right people.

    1. Well there is still a risk. Most people can’t participate in auctions for dealers and even if you can, a lot of times the cars are sold without an inspection. You can end up with a Lemon. If you had good mechanic skills and can fix just about anything and you could get a car for extremely cheap from auction then its worth it. But I think for most people, that is not an option. Plus you can find cars being sold on CL for less than auction prices sometimes.

  8. If the buyer pulls the CarFax he will realize that your flipping the car because it will have the ownership history. How do you respond?

    1. Many different ways. You can say you found something else or you’ve changed your mind. Buyers in my experience can care less if you are flipping or not. They are looking for a good working car for cheap.

  9. One thing I noticed not talked about here is the fact that most people don’t like seeing multiple owners on titles. So a good question to ask sellers is… how many prior owners as u will be the 3rd, 4th, 5th etc.. Carfax will confirm of course.

  10. If the average, lets say 2006 Nissan Altima is selling on CL for $1000, you negotiate the seller down to lets say $700 (I initially thought this was a fair compromise), then you factor in Title transfer fees of like $300, do you then list the car at a higher premium than the average cost on CL (The $1000) to make a profit? And most of the listings I see are all vehicles that require some work. Additional expenses. It sounds like I’d either have to low ball the seller down to like $400-$500 to make a $200 profit and wait about 2-4 weeks to see that profit waiting for the title to come back. Your insight is appreciated.

  11. What’s up… Several questions…

    – example, I’ve bought the car. I have the title signed by the previous owner but do I have to wait for a new title before I can sell it again? Or can I use that same title?

    – In WV we have to register a car within two weeks of buying it. What do I do after buying the car? Go to DMV, register, then sell?

    – can it be be sold without registering it first?

    Can you write in detail this process regarding “flipping” the actual title and paperwork. The way I see it is, buy the car, get it insured and registered, sell the car after new title arrives? But these seems time consuming… How else to do it?

  12. What number do use off of KBB to determine the buying price? The top end of range or bottom or middle? Also when you use say the middle price to come $1000 lower than that price? Also what is the highest you would go on a price? Is the top end of KBB pricing a good limit? Thanks

  13. I want to buy motorcycles, clean them up and sell them. I’m in Dallas as well. I’m still a little confused about titling and tax. Sounds like I’ll need to transfer title, pay tax, and make sure the sale covers total cost of the flip plus profit.

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