If you buy such a car, you have no legal right of ownership and it can be confiscated or returned to the rightful owner. Should this happen, you can pursue a refund - but only if you can find the seller (which is why you should always view a privately sold car at the owner's address).
If buying from a car dealer, ask what checks they've performed. If a motor trader doesn't carry out adequate checks, or you're buying privately, you then have the option to pay for a 'history report' to be certain that you're buying a legitimate used car.
For around £20, companies like HPI check to see: if a car was previously written off, damaged or stolen; if there's any outstanding finance; and they will also confirm a car's identity with the DVLA (Driver and Vehicle Licensing Agency). You may want to seriously consider running such a check if you're bidding for or buying a car 'unseen' over the internet.
Tip: while on the subject of car crime, Thatcham rates vehicles by their level of security - i.e. how easy they are to steal and steal from. If you find that a particular car you're after is like 'honey to a bee' to car thieves, you may wish to go for a less thief-friendly model.
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Next: Paying for a Used Car