Laws for selling a car (US Law)

by Legal Author on January 4, 2012

Below is a blog post from Sean Gray in respect of the US laws applicable to the sale of cars. Sean is an avid blogger, who is exceptionally knowledgeable when it comes to cars. He currently blogs at a company that offers junk car removal. 

Selling a car can be a tricky undertaking. After all, no federal laws regulate the sale. State laws govern car sales and each state creates its own code. Accordingly, it’s difficult to provide advice that will be reliable across all states. Nonetheless, some components of the transaction are almost universal and this helps to lessen the complexity. Check with the local DMV to ensure compliance with state laws.

If the vehicle title has a lien against it, then it will be necessary to obtain a release before beginning the sale of the vehicle. This release is usually a letter that originates from the lien holder and asserts that the seller has the legal right to the title and, therefore, to sell the car. It may also be helpful or necessary to have a bill of sale from the previous purchase of the car or a receipt from the earlier sale. These documents clearly establish the seller’s legal ownership of the car and can remove complications from the transaction.

Although a handshake may suffice for certain business deals it may not hurt to have a written contract when selling a car. The document does not need to be complex, nor does it have to be drawn up by an attorney. Instead, the seller should simply state the details of the transaction on a piece of paper that is signed by both the buyer and the seller. The sellers lists their full legal name and address and designates that he or she is selling the car to the buyer. The contract will list this individual’s legal name and address as well. It should also stipulate how payment will be made, the exact amount of the payment and the date on which the transaction takes place.

The contract’s main purpose is to protect both buyer and seller in the event of a disagreement. It should clearly state that the vehicle is sold in “as is” condition and that the condition of the car is entirely the buyer’s responsibility after the sale.

Once the contract is signed the vehicle is legally the possession of the buyer. At this point it will be necessary to file transfer of title paperwork with the DMV. This process varies by state. Occasionally this paperwork must be completed by both buyer and seller. As always, check with the DMV to find out which laws apply.

Legal Author

Legal Author

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