If you have recently purchased or are about to purchase a car from a private seller, there are several steps to take to properly transfer ownership. Follow this checklist to cover all your bases:
| Step | Description |
|---|---|
| 1. Title Transfer | Ensure the title is clear, get it signed over by the seller, and check for notarization needs. |
| 2. Lien Check | Verify there are no liens on the vehicle by examining the title. |
| 3. Insurance | Immediately contact your insurer to add the vehicle to your policy or obtain new insurance. |
| 4. Payment | Preferably use cash, a cashier’s check, or electronic transfer for payment, ensuring safety. |
| 5. Vehicle Inspection | Have the vehicle inspected by a trusted mechanic even after a pre-purchase inspection. |
| 6. Registration | Register the car in your name with the required documents and fees at the state office. |
| 7. Keep Records | Save all sale-related paperwork like the title, bill of sale, and inspection reports. |
Related Articles To Read:
- When I Buy a Car From a Private Seller Can I Drive It Home
- How Long Can I Drive Without Registration
- Will Insurance Cover an Unregistered Car
- How to Buy a Car from a Private Seller
- How To Sign Over A Car Title
Table of Contents
1. Transfer the Title
The first thing you need to do after buying a car from a private seller is to make sure the title is clear and that you will be able to transfer it to yourself.
Before paying the seller, make sure they sign over the title to you (Properly) by completing the transfer of ownership section. This involves:
- Seller printing and signing their name
- Printing your name as the buyer
- Noting the sale price
- Recording the current mileage (Unless it is exempt from mileage)
Some states require the seller’s signature to be notarized, so check your local laws. Don’t take possession until the title is properly transferred.
2. Check for Liens
Examine the title carefully to ensure there are no active liens from previous lenders.
If there is a lienholder listed, that means there is an outstanding loan on the vehicle and the seller needs to pay off that loan and have the lien released before ownership can be transferred.
To be clear: If the loan is not paid off, you will not get a title or registration for the car.
Related Article: Can You Get a Title on a Car That Is Not Paid Off
3. Get the Vehicle Insured
Contact your insurance provider right away to get the used car added to your policy. Most insurers allow a short grace period, but you’ll want coverage as soon as possible after purchase. If you don’t have an existing auto policy, shop around for new insurance before driving your newly-acquired vehicle.
4. Arrange Payment
The majority of private sellers prefer cash, but a cashier’s check or electronic transfer can provide more security for larger transactions. Never go alone to pay a stranger with cash. Have the seller meet you at your bank or police station parking lot if paying with a cashier’s check.
5. Inspect the Vehicle
Even if you had a pre-purchase inspection done, it’s wise to take the car to a trusted mechanic within a few days for a more thorough look.
6. Register the Car
After successful payment and title transfer, you’ll need to register the vehicle in your name. This process varies by state but usually involves:
- Providing proof of insurance
- Submitting the signed title
- Paying any applicable taxes/fees
- Getting new license plates if required
Many states give you a temporary registration to allow driving while the permanent one is processed.
7. Keep Records
Just like I did at my dealership, hold onto all paperwork related to the sale – the title, bill of sale, inspection reports, etc.
You’ll need these for registration and they establish a paper trail documenting your ownership from day one should there be any problems.
