How to Transfer a Car Title to the New Owner

It is vital when selling a car that you transfer the title, or certificate of ownership, to the new owner. If the title is not transferred in a timely manner, you can be held liable for the vehicle.

Difficulty: Moderate

Instructions

Things You'll Need:

• Vehicle application form (different in each state)
• Proof of insurance of seller and buyer
• Driver's license of seller and buyer
• Bill of sale

1. Maintain insurance on the vehicle until the sale takes place. Make sure the new owner will insure the car immediately after taking possession. The DMV requires proof of this insurance to transfer the title.

2. Find your title. If you have misplaced your title, contact the lending institution for another copy. If the lending institution no longer exists, the Federal Deposit Insurance Corporation can help you obtain a copy.

3. Visit the DMV with the buyer of the car to ensure you both complete the necessary paperwork. While the requirements may be slightly different in your state, you may be asked to show your driver's license, proof of insurance, a bill of sale with the purchase price, the title paperwork, the VIN number and the current odometer reading.

4. Remit a transfer fee, which can range from $20-$300 depending on the state in which you reside.

5. Check with your state's Department of Motor Vehicles (DMV) for additional guidelines, since the process of transfering a title varies from state to state.

Tips & Warnings

• Some states require a bill of sale. It is a good idea to have this on file even if it is not a requirement in your state. Fill out a bill of sale even though it does not legally transfer ownership. This document lists the car's VIN number, description, date of sale, purchase price and the names of both parties involved in the transaction.
• If the buyer does not fulfill his portion of the transfer, the title will remain in your name. This leaves you liable for parking tickets or toll violations incurred by the new owner. Authorities could even seize your property if the vehicle was used to commit a crime.

Resources

• Department of Motor Vehicles for your state's guidelines.
• Federal Deposit Insurance Corporation for help obtaining your title if the lending institution no longer exists.