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Every week we sit down with our customer service representatives and our sales staff and ask them “what are the most unusual questions that we’ve heard from callers or inquiries to our company?” And this week one of the ones that came up was what do you do about notifying a sale or forcing a sale of a vehicle that you sold but the buyer does not transfer the title.
This comes up a lot when you sell a car on Craigslist or eBay or some other private sale and you give the title to the buyer. If they don’t put it in their name right away some sellers worry that they have liability or they can get in trouble if the car is used in a crime or gets in an accident or gets parking tickets. So it is important that you want to get that transfer done. Now, the buyer by law is supposed to apply for a new title in their name within a certain period of time, but what if they don’t do it? What if they don’t follow through on what they’re required to do? How does that affect you? Do you have liability? Can you get in trouble? Because technically, as far as the DMV and the police are concerned, it’s on you, right?
Here are some suggestions on how to make sure that your vehicle transfer doesn’t come back to haunt you.
First of all, when you sell a vehicle, in most states the license plate does not go with the vehicle. So you want to take the license plates off the vehicle. The title and registration are two different things. The title is who the owner(s) are, and the registration or the license plate is what allows you to drive it. So if you’re in a state where the license plates don’t stay with the vehicle make sure you take them off. Don’t let the person just say Hey, I want to use it to drive home and I’ll send them back to you because now you’re giving that person your license plate to drive around with. If they get tickets if they go through red lights if they go through toll booths, the ticket is going to come back to you. So take off your license plates. In a few states, the license plate goes with the car.
The second thing to do is to make sure that you actually sign the back of the title and put the name of the buyer. Do not sign an open title. A lot of times the buyer will say Well, I’ll just sign it and I’ll put the name in later cause I might put it in somebody else’s name. Don’t sign an open title. Put the name of the buyer on that title. In fact, most states require that you do this it’ll say right on the title you have to put the name you can’t sign it blank. In addition, look at the ID of the person that’s buying it, and make sure you write down their name and address so you know who actually is buying the car from you. You want to have a record of that transaction. Prepare a bill of sale for the transfer. You sign it and have the buyer sign it. Keep a copy, maybe make two. You keep one they keep one, or if you only make one, take a picture of it and make a photocopy or whatever you want to do. And make sure you have a copy of the front and back of your title at the time of transfer, that’s all you can do: license plate, bill of sale, copy of the title, and write down their ID.
Now, once the sale’s completed you next want to go to your state’s DMV and get a notice of sale or notice of transfer or affidavit of transfer. Every state or most states have a form like this that you can submit this form to get the vehicle on notice that it’s no longer yours. So God forbid anything happens with that vehicle, if somebody uses it in a drive-by or a bank robbery, the police or the DMV are not going to come looking for you because they’ve already been made aware that the vehicle is not yours. So what says right here is if you sell a transfer of a motor vehicle you must submit this notice within 30 days. Well, guess what? In this state it’s required, whether the buyer puts it in their name or not as a seller you’re required to make a notification. Complete the section and sign the notice. Mail it to the address at the bottom. Keep a copy for your records. Failure to complete the required blocks will result in the notice not being processed.
The reason you want to do that is that first of all in some states it’s required by law. But more importantly, it puts the department of motor vehicles or in this case, the DOR department of revenue whoever issues titles, on notice that you are no longer the owner of that vehicle. You sold it. If the new owner puts it in their name or applies for a title or not, not your problem. Sometimes buyers don’t even get a title. They go out of state. Maybe your buyer is moving to another state or they go to another state. If you don’t file this notice your home state will never know you sold the vehicle. So find that notice of transfer. Make a copy of your bill of sale. Submit that with it. If you can’t find a form for your state, go down to the department of motor vehicles in person. Don’t try to do it by phone. Don’t try to do it by email. Go in person with your photo ID, the bill of sale with your VIN number, and tell them, look, I sold this vehicle, how do I get out of my name? Because you want to avoid liability.
If you’re concerned about what your liability might be you may want to contact an attorney. We can’t give you legal advice or give legal-type instructions, but you do want to make sure that any vehicle ownership is disclaimed by you. Once you don’t have control of the vehicle, you don’t know where it’s been where it’s going or what it’s doing what liability or costs it’s incurring. So you want to make that notice public and put it with the DMV. That’s the most common question for this week. Look for future videos and put your comments below. If you have questions about unusual title scenarios we can answer them for you.
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