Transferring a car title may appear to be a difficult procedure, but it does not have to be. You may simply and efficiently sign over a car title to a new owner by following a few simple steps.
We'll walk you through the process of transferring a car title, including what you need to know about taxes, fees, and paperwork, in this article.
These 10 simple steps will make the procedure a breeze. We'll cover everything from understanding your state's legislation to providing the essential papers and recommendations when purchasing a vehicle. So, get ready to confidently say goodbye to your old car and hello to a new owner.
Table of Contents
- What is a Car Title?
- When To Sign Over The Car Title
- 10 Steps For Signing Over a Car Title
- 6 Different Situations When Signing Over a Car Title
- Which Documents Do I Need to Transfer a Car Title?
- Tips For Signing Over a Car Title
- FAQs About Signing Over a Car Title
What Is a Car Title?
A car title is a legal document that shows vehicle ownership. It usually includes vital information including the vehicle's brand and model, VIN, and current owner's name. When a vehicle is sold, the title must usually be transferred to the new owner. The process of transferring the title varies depending on where you live.
When To Sign Over The Car Title
If you decide to sell your vehicle, you'll need to know how to sign a car title. That is, once the new owner has paid you for the vehicle and you've both agreed that the transaction is complete. It's also a good idea to double-check with your state to ensure you're doing everything correctly. It is critical to sign over your vehicle title because the buyer will need it to register the vehicle at their local DMV office.
The car title serves as a confirmation of ownership and contains the following information:
- Name of the owner
- Vehicle identification number (VIN)
- Model and year of the vehicle
The Department of Motor Vehicles will provide you with the original title. When selling to a private buyer or a dealer, the vehicle must have an official title. If you don't have or can't find your vehicle title, you must request a new registration from the DMV. This paperwork acts as verification that you are the registered owner of the vehicle and have the authority to sell it.
10 Steps For Signing Over a Car Title
Step 1: Locate The Current Title Or Apply For a Duplicate
To sign over a car title, find the original or apply for a duplicate from the DMV, gather the necessary documents, remove the license plates, cancel insurance, fill out the transfer of ownership section with the new owner's information, sign the title, give the new owner a bill of sale, notify the DMV, keep a copy of the title, and remove any personal belongings from the car before handing it over to the new owner, but always check with your local DMV for specific laws and regulations.
Step 2: Draft a Bill Of Sale
Because the bill of sale specifies the transaction date, it might provide legal protection to the seller if they are accused of violating laws they did not violate. This document is also crucial for tax purposes, particularly if the car is considered a capital gain. Even if you lost money on the sale, maintain a copy of this information just in case.
The following information should be included on the bill of sale:
- Date of purchase.
- The seller's and buyer's legal names, postal addresses, and physical addresses.
- The EXACT purchasing cost.
- Description of the vehicle (make, model, year, body style)
- Mileage (and/or odometer declaration form) for a vehicle.
- VIN is an abbreviation for Vehicle Identification Number (VIN)
- a formal disclosure document stating that the vehicle is free of claims, liens, and offsets.
- Warranty information.
- Signatures of both the seller and the buyer.
- Furthermore, several states require a notary public or two witnesses to sign.
Check with your local DMV for any unique laws and requirements. If the sales price reported on the bill of sale is less than the amount paid, the seller may face legal action. Putting a false price on the bill of sale is a typical scam employed by greedy sellers to avoid paying high taxes.
Step 3: Exchange Payment
The buyer pays the seller for the car. This can be done in a variety of methods, including cash, cheque, or online. As a seller, make certain that the buyer has paid you in full before signing over the title and handing over the keys.
Regardless of whether you received payment or not, the buyer is the legal owner of the car once the title transfer is completed. Cash is dangerous; cashier's checks take longer to clear and are not guaranteed; Venmo has transaction limits, and each payment option has substantial disadvantages.
Step 4: Release Liens
If someone else loaned you money to acquire the car and has a legal claim on it, they must permit you to sell it. This is known as a "lien," and they will be required to sign a document stating that they are no longer claiming the car. This must occur before the new owner can register the vehicle in their name. So, before you sell the car, make sure you don't owe any money on it, and double-check that there are no liens on the title.
Step 5: Transfer The Title
After the sale is completed, the new owner requires a piece of paper that confirms they now own the car; this piece of paper is known as the "title," and the way to give it may differ depending on where you live. This is the vital part in which ownership of the car is transferred from the seller to the buyer. The buyer will want the title certificate document for registration and insurance requirements.
The vehicle owner/seller must bring a title certificate. This could be a duplicate or the original title. All fields on the title must be completed by both the seller and the buyer. The buyer should check the vehicle identification number and compare it to the one given on the vehicle title.
VINs are sometimes faked as part of a fraudulent operation. In other instances, a clerical error that was never corrected results in the wrong VIN being put on the title.
Step 6: You May Need To Provide Proof Of Insurance For The Vehicle
Depending on where you live, you may be required to present the new owner proof of insurance before issuing the title. This is to ensure that the car is insured until the new owner can obtain their insurance. A copy of the insurance paperwork or a letter from the insurance company could suffice.
Check with your state to see if this step is required. Also, remember to cancel your insurance on the car once you've delivered it to the new owner, as you're no longer the owner and will no longer be driving it.
Step 7: Notice Of Release Of Liability
When you sell your car, you must notify the government that you are no longer the owner. This is done by completing a special form known as a "Notice of Release of Liability" and submitting it to your state's Department of Motor Vehicles (DMV). This informs the DMV that you are not liable for anything that happens to the car after you have sold it. The form often requests the vehicle's unique identification number, the date you sold it, and the new owner's name and address.
Make sure you do this as soon as possible because if you don't, you could be held liable for accidents or parking citations that occur after you've sold the car. It's also a good idea to check with your state's DMV to determine if any special rules apply to this process.
Step 8: DMV Title Transfer Paperwork
Now that the new owner has purchased the vehicle, they must notify the government that they are the new owner. They accomplish this by completing certain paperwork and submitting it to their state's Department of Motor Vehicles (DMV). They may also be required to pay more money, such as taxes or fees.
They will also need to provide proof that the vehicle is insured. The process may differ depending on where you reside, so the new owner should check with their state's DMV to see what they need to do and what documents they need to bring.
Step 9: License Plates
The new owner will require new license plates now that the vehicle has been registered in their name. This is the metal or plastic piece that is attached to the car and contains the numbers and letters. They'll have to get rid of the old ones and replace them with new ones that have their name on them. They can generally accomplish this at the DMV or a specific location.
They may have to pay a fee for the new license plates. Check with your state's DMV to discover if there are any particular requirements for license plates, such as the color or expiration date.
Step 10: Register The Car
Now that the new owner gets new license plates, they must register the vehicle with the authorities. This implies they'll have to offer the government some documents, such as the title and proof of insurance, as well as pay a charge. They may also need to have the car inspected to ensure that it is safe to drive and fulfills pollution requirements.
This process may differ depending on where you live, so the new owner should check with their state's DMV to see what they need to do. Remember that they must renew their registration every year to avoid getting in trouble.
6 Different Situations When Signing Over a Car Title
When Buying From a Dealership
When purchasing a vehicle from a dealership, the dealership will handle the majority of the paperwork, such as the purchase agreement, title transfer, registration, new license plates, and submitting a notice of release of liability with the DMV. The customer must pay for the vehicle and check the purchase agreement as well as any other documentation provided by the dealership.
When Buying From a Private Seller
When purchasing a car from a private seller, the buyer is responsible for the majority of the paperwork, including the purchase agreement, title transfer, DMV filing of a notice of release of liability, registration, and getting new license plates. The buyer will pay the seller and go over the purchase agreement, as well as any other documentation provided by the seller. It is critical to verify with the local DMV for any special laws and regulations about the purchasing process.
However, we understand that not every vehicle can be resold to a private buyer as a used vehicle. Some cars are destined to be sold to a junkyard to end their useful life. Yes. You can junk or sell a car without a title to earn some cash. An average car without a title may fetch you between $250 and $500. Get your instant free quote here!
When There’s a Lienholder
When purchasing a car with a lienholder, the buyer must pay off any outstanding loans, acquire a lien release from the lienholder, transfer the title in their name, file a notice of release of liability with the DMV, register the vehicle, and obtain new license plates. The process may be more complicated than when purchasing from a private seller, however, the buyer should check with their local DMV for any unique laws and regulations involving the purchase process when a lienholder is involved.
Between Family Members
The process of transferring an automobile title between family members is similar to that of a private party transfer but may differ based on state legislation. A purchase agreement is signed by the buyer and seller, the title is transferred to the buyer, a notice of release of liability is submitted to the DMV, the car is registered, and new license plates are obtained. Verify with your state's rules and regulations, as certain jurisdictions may have different criteria for when a vehicle is passed between family members.
After Paying Off a Loan
When paying off a car loan, the borrower must first pay off any outstanding debt to the lender and acquire a release of lien, after which the title is transferred to their name, a notice of release of liability is filed with the DMV, the vehicle is registered, and new license plates are obtained. Depending on the type of loan and state restrictions, the process may differ. Any specific laws and restrictions should be checked with the local DMV.
When The Current Owner Is Deceased
When the existing owner of a vehicle dies, the process of transferring the title will be handled through probate court and may differ based on state legislation. The legal heir must obtain a copy of the will or probate documents, inform the DMV, transfer the title to their name, register the vehicle, and obtain new license plates. The process may differ according to state legislation, so check with your local DMV for any special restrictions and requirements.
Which Documents Do I Need to Transfer a Car Title?
You'll need to acquire a few key documents when changing a car title. These could include:
- A picture ID is required.
- Evidence of a name change
- A completed and signed title and registration application
- A car title that has been signed and notarized
- Other papers, such as personal representative papers or powers of attorney
- If a lien is required, it must be released.
- Fees for registration and title
- Insurance proof of the buyer
You should also visit the DMV page for your state to get the complete list of documents required.
Tips For Signing Over a Car Title
Signing over a car title without signing in the appropriate spot or having all of the information your state demands can cause the procedure to be slowed. Here are some tips for signing over a car title:
- Check your signature: Make sure the current owner(s) of the car signs the title in the correct locations to avoid confusion later on.
- Keep an eye on the odometer: Many states need the current odometer reading to be included on the title when it is transferred, so keep it available.
- Please, no surprises: Check for any outstanding liens on the vehicle before signing over the title. You don't want any unpleasant surprises down the road.
- Include the date of sale on the title: Including the date of sale on the title will help ensure that the title transfer occurs smoothly and on time.
- Make a duplicate for yourself: Keep a copy of the title for your records once it has been signed.
- Understand the rules: Each state has distinct laws, regulations, and procedures for transferring a car title, so consult your local DMV for a complete list of required paperwork and procedures.
- Double-Check the Vehicle's Information: Before submitting the title and all other relevant documents to the DMV, double-check that you've filled out all of the appropriate fields and that all of the information is correct.
FAQs About Signing Over a Car Title
How Much Does It Cost To Transfer a Car Title?
The cost of transferring a car title varies based on where you live, but it is usually not too expensive. For the most current and up-to-date information on prices and regulations in your area, contact your state's Department of Motor Vehicles (DMV). But overall, transferring your car title shouldn't be too much of a burden.
Can I Just Sign a Car Title For Someone?
To transfer a car title to someone else, you must complete the proper forms and supply the necessary documentation. This often involves signing over the title to the new owner, delivering a bill of sale, and paying any applicable fees or taxes.
However, because laws and regulations differ from state to state, it's essential to check with your state's DMV for exact guidelines. Oh, and if the vehicle is still financed, the lender must approve the transfer of ownership. So it's a simple process that you can do; just make sure to check with your state's DMV for specific criteria.
Can You Transfer The Title Of a Financed Car?
Yes, you can transfer the title of a financed vehicle. However, because the lender must first approve the title transfer, the process might be difficult. In many circumstances, the lender will insist that the debt be paid off in full before allowing the title to be transferred. They may also request additional paperwork and documents before approving the move.