Not All About The Money: What To Do When Selling A Car Privately
If you sell your car to a dealership, they'll help you with what to do regarding your title and registration, but when you sell your car in a person-to-person sale on your own, it's important to know what to do so that you and the new owner have all of the appropriate documents.
State laws vary, so it's important to check with your state's Department of Motor Vehicles or Secretary of State so that you know exactly what to do to comply with applicable state laws.
The Seller's Responsibilities
In many states, anyone selling a used car is required to provide the buyer with a state inspection certificate or a smog or emissions check before finalizing the sale. In states that require this, a check or certificate done within the past 90 days should suffice.
Many states have a place for information dealing with the sale of a vehicle on the back of the title. Make sure not to fill this out or sign it until the buyer is in your presence and the sale is being finalized so that you agree on the information, such as the purchase price and the odometer reading. Keep in mind that if more than one owner is listed on the title, all owners will have to sign off on the sale before the vehicle is considered the sole property of the buyer, including the signature of a lender if the car had a lien on it at any point.
It can be helpful to go with the buyer to the DMV or Secretary of State's office to complete the transaction, but it is not required of the seller in most states to do so.
Also, make sure to remove your license plates before you allow the buyer to drive off with your car. In some states, you may be able to transfer the plates to another vehicle you own, but this isn't as simple as simply attaching the license plates to another vehicle. Your state's DMV will be able to assist you with transferring them, along with your registration, if that's an option.
The Buyer's Responsibilities
It is the buyer's responsibility to acquire a new permanent title for the vehicle and to register the car in his own name. Some states require state taxes or state transfer fees, and these are also the responsibility of the buyer. In some states, selling a car to a relative exempts the buyer from these taxes and fees.
It will also be the buyer's responsibility to obtain insurance on the car, so once the sale is complete, make sure you, as the seller, contact your car insurance company to inform them of the sale so that you do not continue to pay insurance premiums on the vehicle. If you previously had a discount for having multiple vehicles with the same insurance company, make sure to ask how removing the sold vehicle will affect your premium.
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