Buy a Car Without a Title
In many states, even if you pay for a car you do not legally own the car without a title. If someone is offering to sell you a car without a title, you should take certain steps to ensure that you are legally purchasing a car, without a lien, and one that has not been considered salvage by an insurance company. Before purchasing the car, you should attempt to secure the title by reaching out to previously registered owners. If you still want to purchase the car without a title, you should take steps to minimize the risk, such as drafting a bill of sale.
Determining Existing Problems with the Car
- Inspect the car in person and meet the seller. Before purchasing a car without a title, you should inspect the car in person. This gives you an opportunity to not only examine the car but also the seller. You are looking for a reputable seller who will help you secure a title, if possible. If the seller is pressuring you into buying the car, you should consider walking away from the purchase.
- Ask the seller whether they ever had the title and how they came into possession of the car. Explain to them that you are trying to determine whether or not you can obtain the title for the car.
- If they seem unwilling to help you or uncomfortable answering questions about how they got the car, you should seriously consider not buying the car. Without the title, you have no way of knowing whether the seller has the legal right to sell you the car. If they don’t have the legal right to sell the car, you could be purchasing stolen merchandise.
- Identify the VIN number and take a picture. While you are inspecting the car, be sure to photograph or copy down the car’s vehicle identification number (VIN). Every car is assigned a 17-digit number that identifies the place the car was manufactured, the year, model and make of the car, as well as other identifying features. You can find the VIN number in the following places:
- Below the windshield on the driver’s side of the car
- In a car’s engine bay on the firewall, which is the wall located between the engine and the passenger compartment.
- On a sticker or metal plate located on the doorjamb on the driver’s side of the car.
- Run a free VIN number check. The National Insurance Crime Bureau (NICB) allows people to run a free VIN check in order to determine whether a car has been reported as stolen but not recovered or if a NICB member insurance company listed it as salvage.
- You can conduct a VIN search here: https://www.nicb.org/theft_and_fraud_awareness/vincheck. This website allows you to run up to five free VIN searches in a 24-hour period.
- A car that is listed as salvage may have been in an accident, have serious structural problems or be expensive to repair. Many insurance companies will not insure a salvage-title car, which means that you would not be able to register the car in your state.
- Decide whether to walk away from the sale or attempt to secure a title. If the car has been listed as salvage, you should strongly consider not buying the car unless you are looking to purchase it for parts. If the car has not been listed as salvage or reported as stolen, and they seller seems like a reputable person, you should take steps to acquire the title.
Identifying Previous Owners
- Ask the seller whether they ever had the title. If the seller seems willing to help you secure the title to the car, state by asking them whether they ever had the title. If they did, in most states you can easily request a duplicate title for a small fee. You can check the state-by-state requirements for replacing a lost title at: http://www.dmv.org/replacing-a-lost-title.php.
- Run a more extensive vehicle report. If the seller is not sure whether they ever had the title, you can use the VIN number to run a more extensive vehicle information report, which may help you locate the previous title holder. While you will have to pay a fee for this report from companies such as CARFAX, the report provides the following useful information:
- Number of owners and the states where the car was registered.
- Information regarding liens on the car.
- Accident reports.
- Maintenance on the vehicle.
- Accident history.
- Car title check.
- Other damage to the car.
- Whether the car was salvaged.
- Ask the seller for a bill of sale from previous owner. If the seller does not have a title but did get a bill of sale when he or she purchased the car then you may be able to use the bill of sale to track down the previous owner.
- You should check whether the information on the bill of sale matches the information on your vehicle report. Specifically, check if the car was sold in the same state where the car was registered and titled.
- Identify the previous owner and try to locate the person using an internet white pages search at whitepages.com. This allows you to search people by name and location in an attempt to locate their phone number.
- If you locate the previous owner, call them and ask whether they would be willing to assist you in getting title for the car. You can offer to pay for any fees that they may incur as a way of encouraging them to fill out the online paperwork and transfer title.
- Contact that last DMV where the car was registered. If you are unable to locate the previous owner, you should contact the DMV for that state and explain that you are looking to secure a proper title to the car and give them the name of the seller and the VIN number for the car and the bill of sale. The DMV may be able to help you or explain what, if any, additional steps you need to take.
- You can find contact information for motor vehicle departments in the United States at: http://www.dmvnv.com/50_state_dmv_list.html.
- Consider hiring a title company. If you are unable to get the title for the car, you should consider hiring a title company to try and get the proper title for you. You can do this before you purchase the car or if you already purchased the car without a title. You can find businesses that help you get titles by conducting an internet search for “title recovery services.”
- Before hiring a title recovery company, check with the Better Business Bureau at https://www.bbb.org, to see whether there have been any complaints filed against the company.
Drafting a Bill of Sale
- Draft a bill of sale. If you decide to purchase the car with or without the title you should draft a bill of sale. A bill of sale is a sales agreement between two parties. Some states require that you have a bill of sale in order to transfer title. Even if it is not required, you should still get a bill of sale for your own records to document proof of purchase. You should have the bill of sale notarized and it should include the following information:
- The name and address of the seller(s).
- The name and address of the buyer(s).
- Information on the car being bought/sold, including the make, model, body type, year and VIN number.
- List any additional items that the sale includes, if applicable, such as snow tires.
- The current odometer reading.
- The full purchase price.
- A warranty from the seller stating that he or she is the legal owner and that the vehicle is free from all liens or encumbrances.
- Whether the vehicle has been inspected by a mechanic prior to purchase.
- Information identifying the condition of the vehicle and whether it is being sold “as is.”
- Identify whether the vehicle was a salvage vehicle, deemed a total loss by an insurance company, or whether the vehicle was repaired under “lemon law.”
- Identify any additional terms of sale.
- Signatures by all parties to the sale of the car in front of a notary.
- Get proof of payment. In addition to the bill of sale, you should purchase the car with a check or bank check where you can demonstrate that you paid the funds to the seller.
- Transfer title. If you were able to assist the seller in replacing a lost title or having a previous owner transfer title to the seller, you should make sure that the seller transfers the title to you when you are exchanging payment for the car.
- Register your vehicle. Some states, such as New York, will allow you to register your vehicle with the state without the title. After completing your state’s required paperwork, the state may issue you a non-transferable registration, which means that the car is registered in the state, that you can use the car but that you cannot sell it to another person.
- To locate registration requirements in your state visit: http://www.dmv.org/car-registration.php
- If a seller refuses to meet you at his or her home, refuses to show you their driver’s license and demands cash for the car, you should not purchase the car. The seller’s behavior should raise a number of concerns, one of which is that they do not own the car.
- If you purchase a car without a title, you should consider hiring a company to try and get you a perfected title. This will allow you to more easily sell the car in the future, register the car with your state’s DMV and get car insurance.
- Buy a Used Car
- Buy a Used Car Off Craigslist
- Register a Car
- Re Title a Vehicle to Another State
- Get a Title to an Abandoned Vehicle
Sources and Citations
- http://titlerecovery.com/video.html; https://www.youtube.com/watch?v=beIp-8XHexI