How do I transfer legal ownership of a car or recreational vehicle?
Title documents for vehicles often include everything you need to transfer ownership. It will usually have an area to fill out, sign and give to the buyer, and also have a detachable section for the seller to fill out and send in to the Department of Motor Vehicles.
To transfer a car title, you must first sign the title to release ownership. Then, give the signed title to the new owner, who will take it to the Department of Motor Vehicles to get a new title issued in their name. The state will then issue a new title and registration document to the new owner of the vehicle completing the process. Some states may have additional steps to take, such as inspections or emissions testing, before finalizing the new owner's registration.
Can I sell a car or other vehicle without having the title in hand?
Having the title in hand is always best, but if it got lost along the way, you can still sell your vehicle. You may want to contact the DMV to get a replacement title, as not having the title in hand will reduce the number of interested buyers. Some buyers will be willing to wait for you to do so. If getting a replacement is not possible due to the age of the car or other circumstances, then be honest with the buyer. If the buyer wants you to get a new title, but does not want to wait, you can complete the sale using an Affidavit of Ownership along with a Bill of Sale.
This happens frequently for parts cars, inherited vehicles, RVs, and boats. To sell an untitled vehicle, making an Affidavit of Ownership to give to the buyer can help by providing certainty that you can legally sell it.
How do I protect myself when selling a car or boat?
The first thing to do when it comes to the actual sale of a vehicle is to make a Bill of Sale. This is a legal contract between you and the buyer that sets the terms of the agreement, including the price, what's included, and whether there is a warranty.
Once an agreement is in writing, sellers still need to be careful. Selling a car usually means accepting payment from a complete stranger, which is an opportunity for fraud. Buyers with bad checks or counterfeit bills can rob you not only of your car, but also of your money. You could also wind up in legal trouble of your own if you use the counterfeit cash you received. You can protect yourself by being careful about how and where you conduct the transaction.
For checks, don't release the car until it clears. If that is not possible, at least get the issuing bank to confirm the check will not bounce, but be mindful that scammers may have a fake phone number listed on a check that goes to an accomplice's phone. You may want to verify the buyer's ID with a driver's license and a second form of ID that has a name and address as well.
To be safe, if you can, complete the transaction at the buyer's bank. That way, before turning over the keys, you can cash the check rather than depositing it in your bank, then request that their bank issue a new cashier's check to you or wire the funds to your account directly. If the buyer will pay cash, you can complete the transaction at your bank. This will allow you to easily have the cash counted quickly and accurately, and provide assurance that the cash is legitimate.
Never take a check payment that is for more than the car is worth with the request to give the buyer the difference back in cash. This is a very common scam. In these scenarios, it is very likely that the check will not clear, and the buyer will be demanding their money back before the check even has a chance to clear. Finally, be extra cautious if someone wants to buy your car or boat without actually seeing and driving it.
What does it mean to sell a vehicle "as is"?
Selling a vehicle "as is" means you are selling a vehicle without any guarantee or warranty. This is commonly done if the vehicle is used, or has a known or supposed mechanical or cosmetic problem. This typically releases a seller from any liability should the vehicle break down just a few miles down the road.
However, sellers that know about a problem may not lie about or conceal it. An "as is" sale will generally only protect sellers when it comes to known issues that are disclosed or obvious, and unknown issues.
Do I have to get the vehicle tested or inspected before selling?
Most states do not have a pre-sale inspection requirement. However, in some states, including California, Alabama and Maryland, a seller may be required to get a smog or safety check for their vehicle before it can be legally sold or transferred to a new owner.
Many buyers may want to take your vehicle to a mechanic they trust. For sellers, allowing buyers to get the car inspected before the purchase is a good idea. Doing so can help protect you from liability if something goes wrong after the sale, particularly when a vehicle is sold "as is."
Am I liable for the car or boat after I sell it?
A seller should not delay notifying the DMV about the sale. In most states, once the title is signed over and the seller mails in their portion, the seller is no longer liable unless they provided a guarantee or warranty, or lied to the buyer.
Also, make sure to remove the license plates from the car before letting the buyer drive away. If you don't, then you could be on the hook for what happens while those plates are on it. That could include red light camera tickets, parking tickets, or other violations that rely on the license plate to identify the owner or driver. Only Alaska, California, Delaware, Hawaii and Minnesota require sellers to leave license plates on a car after selling it, so long as it is not a customized or vanity license plate.
Additionally, lemon laws may apply when you sell a car or boat privately. Lemon laws protect buyers deceived by sellers who know their vehicle is about to break down, or is a lemon that's going to require frequent repairs, but don't tell the buyer. In most states, lemon laws only apply to vehicles purchased from a manufacturer or dealership.
If you're selling a vehicle, you will need to check your state's laws to see what applies. You can usually find the information you need to know on your state's DMV or Secretary of State website. For additional help with buying or selling a used car, check out the Rocket Lawyer mobile app. If you have questions, a Rocket Lawyer network attorney can help you figure out the laws in your area.
This article contains general legal information and does not contain legal advice. Rocket Lawyer is not a law firm or a substitute for an attorney or law firm. The law is complex and changes often. For legal advice, please ask a lawyer.
