How to Sell a Car Out of State: Vital Information to Make it Legal

May 24, 2013

If you hope to sell a car out of state to a prospective buyer, there is some important information to have before completing the transaction. With state laws regarding motor vehicle registrations varying significantly from one state to another, it can be difficult to know you are making the right decisions when selling a vehicle. Although used car buyers normally come from near your home, with the advent of advertising on the Internet, the likelihood you will sell a car to an out of state buyer has increased significantly. While each state has its own rules that are imperative to check, the guide below is an important checklist to follow so you get the proper information.

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Step 1: Only Accept Cash or Equivalent

When selling a car out of state, you should accept cash or an equivalent, like a cashiers check, for payment. With online sales perpetuating many types of scams, accepting only cash is an easy way to avoid being caught up in a fraudulent transaction. In fact, depending on your time constraints, it may be worthwhile to take the buyer with you to the bank, so you may confirm that the funds are authentic, and they can be deposited directly in your account.

Step 2: Photocopy Driver's License

Make sure you have a photocopy of buyer's license on file, so you can confirm the vehicle was sold to a licensed driver. This is also helpful because some states require the buyer's license number to be listed on the reassigned title.

Step 3: Photocopy Insurance Card

In most states, a vehicle just purchased is covered under a driver's other policies. If this is the case, make a copy of any valid insurance card possessed by the buyer so their insurance coverage is verified. If your state requires insurance to be specific to the new vehicle, make sure the card identifies the vehicle being purchased.

Step 4: Go to the DMV

Even if the buyer is from out of state, it is still advantageous to take them to your local Department of Motor Vehicles office. This is because a temporary registration and temporary license plates may be required in your state, even if the vehicle is being driven to another state. In order to keep the vehicle on the road legally after selling it to an out of state buyer, the DMV can issue a temporary plate and registration to be used until the driver visits a DMV office in their own state. Remember, when you sell a car out of state, the buyer must get plates and transfer the title as soon as possible after they arrive home. Otherwise, moving and parking violations, as well as an abandoned vehicle towing fees, could be billed back to you.

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Step 5: Draft a Bill of Sale

A photocopy of the reassigned title, front and back, is sufficient as a bill of sale. Make sure that the buyer's information on the title is correct, so that it can be transferred without hassles. If you prefer to have a more detailed bill of sale to record the transaction, you may handwrite or print one from your computer. Be sure to include the buyer's contact information, the VIN number and the cash selling price.

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