How to Transfer a Car Title and Ownership After Selling a Car

You’ve found a buyer for your car and you have agreed on a price, now it’s time to close the deal. Closing the deal and transferring ownership is fairly straightforward, but you will need to do a bit of legwork in advance to ensure things go smoothly.

Start with the DMV
The first step in the process is to contact the Department of Motor Vehicles (DMV) for your state to see what it requires when transferring ownership of a car. A federal law now requires that in every state, the seller must provide the vehicle title and some form of odometer disclosure listing the vehicle’s current mileage at the time of the sale.

Since requirements and acceptable documents can vary from state to state, consult our list of State Motor Vehicle Websites to find the website for your state’s DMV and then review the process to transfer ownership on its site.

For more details on the documentation for transferring ownership, read Paperwork to Close the Deal.

If You Owe Money on Your Car
If you don’t own your car outright, you’ll need to contact the lienholder (usually a bank) to find out what you need to do. Typically it involves simply determining the payoff amount and arranging that transaction. Once complete, you will then be able to obtain the title.

If you are still in a lease, you’ll need to start with your leasing company to find out what your options are. They vary by company; be sure to get specifics in writing.

Once you have the title, you can proceed with the sale. If your buyer is paying by check, be sure to confirm with the issuing bank that the funds are available. If your lender isn’t local, use an escrow service to complete the transaction. Only use a service you are familiar with and have researched thoroughly, however, as some of these companies are running scams.

For more tips on preventing fraud while closing the deal, read Fraud: Protect Yourself.

If the Buyer Is Out of Town
While it’s not unheard of, be wary of any buyers who cannot meet you in person to transfer ownership, as there is a greater potential for fraud when there is a middleman, sometimes called a “buyer’s agent.”

In most states, it is possible to transfer ownership with a long-distance buyer. If you choose to do so, be sure to get any agreements notarized by both parties, and confirm the payment is secure before signing the title or giving the keys to a third party.

Closing the Deal
Once you’ve done your advance legwork and know what steps you need to take to transfer ownership, it’s time to meet with your buyer to close the deal. Bring along all the necessary paperwork to transfer ownership, as well as any maintenance records or warranty information that applies to the vehicle.

Make sure the payment for the car has been secured and then sign over the title and other documentation to complete the sale. Once the sale is complete and your buyer has left with the car, contact your insurance company to have the vehicle removed from the policy.

Tara Baukus Mello is a freelance automotive writer whose work has appeared in numerous publications including Woman’s Day and The New York Times.

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