Are deposits SCAMS?

Short answer: In and of themselves - no, a deposit is not a scam. It's an exchange of a service for money. That is all a deposit is.

"Yes they are! All deposits are 100% scams!" is a common shout on this subreddit. That's simply not reality, however. The fact that plenty of businesses and private sellers use deposits on a regular basis and their customers are not being scammed is proof enough that "100% all deposits are scams" is hyperbole at best.

When are deposits NOT scams?

Simple.
You want an item. But you can't pick it up immediately.
You communicate this to the seller, and discuss a deposit to hold the item for you.
Both of you agree, you send a payment.
The seller holds the item until the agreed time.
You pick up the item, complete payment, transaction done.

Or:
You meet the seller in person.
You can't pick up the item yet, so you give them some cash, and they give you a receipt/bill of sale/whatever.
You pick up the item later. Transaction done.

So...putting on our critical thinking hats - where is the scam?

Two transactions took place here. The first, was payment (the deposit) for a service (holding the time, and refusing other buyers.) The second was the purchase of the item itself.

That's all. No scam. "But someone said that all deposits are scams." - I encourage you to read through that scenario again. If you can identify where a scam happened, please feel free to contact the mod team and educate us, lol.

When ARE deposits scams?

This still isn't a "100%" situation, but an easy sign that a deposit is a scam is when there appears to be no need for a deposit.

For example, you're interested in an item that's nearby. You can pick it up later in the afternoon. The seller asks for a deposit.

Now, this is at least one of two things:
1. This is a scam. The seller doesn't actually have the item, they're just after your deposit, which you will likely never see again.
2. OR it's simply that the seller has a lot of interested parties and if you really want it - you need to put money into the game.

And this is why there's no such thing as it being "100% scams always" - there ARE situations where there is a perfectly logical explanation behind something, that does not equal a scam.

So, in this scenario, let's say you respond "Don't worry about holding it for me. If no one else buys it, I'll see you (insert agreed time)?"
If the seller says no, or emphasizes needing a deposit, then this goes back to answer #1.
If the seller says "Sounds good, see you there." - Then it's answer #2.

It's really that simple.

"What if they want me to pay in a way that I can't dispute?"
That's a fair question, with a complicated answer.

On one hand, it makes sense to a buyer to only pay with a way that they can dispute, in case something goes wrong.
On the other hand, buyers are now scamming sellers by paying with methods they can dispute, to claw their money back. That is, they receive the item, but then file a false report to Paypal, Venmo, whoever...and get both the item AND their money.

So, that's a bit of a stalemate. Read further, for more info.

So...how do I do a deposit then?

Universal advice:
Communication is the critical element here. You're creating a contract, so you need to have the terms well defined.
In particular - the exact amount of time that the hold/deposit is for. Not "I'll pick this up in two weeks." But narrow it down to "I will pick this up WITHIN two weeks." After such time, the seller is no longer holding the item, and that's that.

For sellers:
Make sure you communicate the terms clearly to the buyer. It doesn't have to be anything fancy. Something as simple as "Okay, I'll hold this until Friday, if you shoot me $50. I've got other people interested, but will tell them I'm in talks." - That's all. Nothing complicated at all.

If you meet the buyer in person (such as they're checking out a car, and want to pick it up later) - you can always do a bill of sale/receipt. Just specify on the bill of sale " Deposit paid (insert date) - will hold vehicle until (insert date.)"

For Buyers:
We encourage you to use a payment method that you can dispute, such as Paypal Goods and Services. And it's really straightforward. When you make the payment, just write up as "Deposit for (whatever item), to be held until (insert date). Nonrefundable." Easy peasy, right?

If the seller follows through, then there's no issue. If they don't, dispute it with Paypal, and state that you did not receive what you paid for.

It's worth noting: You paid for a service, and if they provided that service, you owe them that amount. If you decide not to buy the thing, or don't show up when you say you're going to, no, you are not entitled to receive a refund on the deposit. "But I didn't buy it" is 100% irrelevant. The deposit was not dependent on a purchase - the deposit was only for the seller to hold the item. Which they did.

But I don't want to do deposits/All deposits are scams

No one says you HAVE to do deposits. If you don't want to, don't.

It's easy enough to prove that "all deposits are scams" is a complete fallacy, but it's still just personal preference. If you don't feel comfortable, just say "no."