FAQ on Buying a Used Car From Owner

Buying a car from a dealer can be expensive and time consuming.  Sometimes you can get a better deal on a car if you buy it directly from the owner; however, you need to use caution and make sure you are doing what is required for the sale.  You also want to make sure that you are protected in the sale.  When you buy a used car from an owner, you can’t return it to the store.

How do I find used cars for sale by an owner?

Look at the autos listed for sale in your local newspaper or browse the listings on Craigslist.  This website will have cars for sale by dealers and by owners.  Be sure to select “by owners” when searching for a used car on Craigslist.

What if the owner doesn’t have a title?

Having the title to the car is essential for your transaction.  You should never buy a car from an owner without a title.  If the owner does not have the title, it may mean that the car has been stolen or it is owned by another person.

Can I test drive the car that I want to buy if it is sold by an owner?

You should always ask to test drive the car before you buy it.  If the owner will not allow you to drive it, you may want to reconsider purchasing it.  Be prepared to allow the owner to ride with you or ask to see your driver’s license and proof of insurance.

Will I need to pay taxes on the vehicle that I purchase from an owner?

Depending on your state of residency, you may or may not need to pay sales tax for your purchase.  You will need to contact the Driver and Motor Vehicle Department for your state to find out about the tax laws.

How do I get the title in my name?

Once you have given the owner money for the vehicle, he or she will sign the title.  You will also need to sign and date the title.  The bottom portion of the title is perforated and will need to be torn off and sent in to the state by the seller.  You will need to take the title to a licensing office in your area.  Professional license services can be found by searching the listings on MerchantCircle.  You need to pay a fee and the company will have the title reissued in your name.  You should receive a new title within six to eight weeks.

Can I use the seller’s license plate until I get a new one?

No.  The seller should remove the license plate from the vehicle before you take it with you.  Keep the title and sales information in the glove box of the car until you can get to the licensing service.  You will receive a temporary license to put on the car until your new one arrives.

Is there anything I should do before buying the vehicle?

If possible, have a mechanic look at the vehicle.  Most reputable mechanics can give it a quick inspection and let you know if there are any major issues with the vehicle.  Getting another opinion on the car can help you determine if this is the vehicle for you.