Buying a used car for a private party can lead to a lot of money saved in addition to plenty of potential pitfalls. One example would be if the seller doesn’t have the title to the car that you want to buy. But is that something that you should walk away from, or is it possible to buy a car without a title?
Why wouldn’t the seller have the title to the car?
If you’re unaware of what a car title is, also known as a “pink slip”, it’s a document that declares the vehicle’s legal owner. According to Autoblog, there are some cases where the car’s title may have been misplaced, damaged, or stolen – but it’s also possible that the vehicle itself is stolen. The issue with buying a car without a title is that you need the car’s title in order to register it in your state. And while buying a car without a title comes with extreme caution, it’s still possible.
How to buy a car if the seller doesn’t have the title
If you find a car that you really like online and the seller clearly states that it doesn’t have a title, then here are some steps that you can take before pulling the trigger:
- Obtain a vehicle history report: A vehicle history report from sites like Carfax or Autocheck can confirm the vehicle’s legal status. A vehicle history report can tell you pertinent information like the car’s odometer readings, its title status, as well as any previous accidents, so it’s a good first line of defense in figuring out if the car was stolen.
- Contact the DMV: You can also check with your local DMV office to find out more information on the car using its vehicle identification number (VIN).
- Check with the NICB: The National Insurance Crime Bureau (NICB) can tell you if the car was reported stolen or salvaged as well.
Autoblog notes that if the vehicle passes all these checks and there aren’t any red flags raised, then you can proceed with the sale. However, there are more steps to follow.
A ‘bill of sale’ can complete the purchase
When proceeding with a no-title sale, it’s important to write out a “bill of sale” with the seller in order to complete the transaction. You can do so by following these steps:
- Write the details of the sale: Include the car’s VIN, mileage, and the sale price of the car. Also include other information like if the car is being sold “as is” and if the seller will supply the title later on.
- Fill out the buyer’s and seller’s complete information: It’s important to include the both parties’ legal information including full addresses, phone numbers, and legal names on the bill of sale.
- Pay the seller: After getting a proper bill of sale filled out, be sure to pay the seller using form of payment that can be traced later on, if needed. Use a bank draft or check that you can refer to, or you can even makes a sales agreement that puts the money in escrow if the seller says they will give you the title later.
The seller can request a duplicate title
Another way to buy a car without a title is to have the seller request a duplicate title from the DMV. Autolist notes that they will need to provide the VIN for the car, the name and address of the titleholder, the car’s mileage, and proof of ownership. It can take a few days for the new title to arrive, but in this case, it’s important to not hand the seller any money until they have the car’s title in hand.
Get a surety bond
After you have procured a proper bill of sale, you’ll need to take it to the DMV, along with all of the other necessary documents. The DMV will then send you a letter stating the amount of the vehicle surety bond that you need to purchase from an insurance company. The surety bond ensures that the vehicle is clear of any liens so that you can be its new owner. Once you buy the surety bond, you can then apply for a bonded title that shows you as the new owner.
Is buying a car without a title worth it?
Cars that are sold without titles are usually a lot cheaper than those that come with them. However, the steps that you need to complete to legally buy one, in addition to the added cost of the fees, might not make it worth it in the end.
In any case, if you plan to buy a car without a title, you should ask yourself if you want to go through all of that hassle to get it legally registered. If the car seems worth it, then do it. But if not, then you might be better off buying a car with a title. It could save you a lot of headaches, and even some money, in the long run.