What to know about buying a car out of state from a private seller
There was a time when car buyers were often limited to local inventory. Thanks to technology, however, present-day car lovers can sort through listings from all around the country and find the deal that’s right for them. Buying a car out of state from a private seller isn’t radically different from buying a car locally, but there are some additional considerations. Let’s start with the general process of buying a car out of state:
- Find a car.
- Calculate total costs, including sales tax and transportation costs.
- Gather funds for the purchase.
- Get a vehicle history report.
- Ensure the vehicle meets your home state’s safety and emissions standards.
- Have the vehicle inspected by a trusted mechanic.
- Register and insure the car.
- Obtain the title.
Reasons for buying a vehicle out of state
Perhaps you’re wondering why someone would go forward with buying a vehicle out of state. Some common reasons include:
- Rare or classic cars: Collectible cars are often sold out of state and attract a specific type of buyer who’s uniquely interested in that car. In addition, collectors tend to be less daunted by distance or shipping costs.
- Regional supply and demand: Regional differences in supply and demand might mean you’ll find a tempting deal outside your home state. A private seller out of state may offer a better price, or you may just find more models of the car you’re looking for.
- Special circumstances: Sometimes, special circumstances might motivate someone to buy a vehicle out of state. Perhaps your uncle is willing to sell you his car at a steep family discount, or a friend tipped you off to an especially attractive deal.
How to buy a car out of state from a private seller
As you can see, there are several reasons why people might buy a car out of state. Whatever your reasons may be, here’s an overview of the process if you decide to move forward:
1. Find a car
Your out-of-state vehicle purchase begins with finding a desirable car. Maybe you’re looking for a particular make or model, a certain price range, or you found a deal you just can’t resist.
Once you have an idea of what you might want, there are numerous online resources available to search listings. Many of these are nationwide and allow you to filter results according to your preference.
2. Calculate total costs including sales tax and transportation costs
Once you’ve found a car you like, it may be useful to add up other costs you expect to incur on the purchase. It’s helpful to double-check with relevant authorities from each state before finalizing a purchase to determine any requirements such as taxes, fees, registration, etc.
If you’re having the car transported to you, then shipping is another expense to account for. If you opt to drive it home yourself, there are fuel costs, food costs, toll costs and possibly even hotel costs to think about. Once everything is factored in, you'll have a clearer picture of whether this out-of-state deal is still worth it.
3. Gather funds for the purchase
After determining what your final purchase cost will be, you’ll need to figure out how you’ll be paying for it. Note that lenders sometimes don’t offer financing for private auto sales, so you may have difficulty getting an auto loan. If you’ve got the cash saved up for the purchase, that could help simplify matters.
4. Get a vehicle history report
If you’ve found a car and, after factoring in all the costs, it’s still a deal you’re willing to make, it’s time to dig a little deeper into the vehicle history report to make sure it’s still in good shape.
There are plenty of online sites for vehicle history reports, and you may find it helpful to look up any accident reports that could support your negotiations. The Department of Motor Vehicles (DMV) is another great resource to look up title information. If there’s a lien on the car, for instance, the current owner will likely need to resolve this and secure a lien release before you can bring it home.
5. Ensure the vehicle meets home state’s safety and emissions standards
Regardless of where the car is purchased, it must adhere to the regulations of the state you'll be driving in. If the car you want doesn’t meet these regulations, then you’ll likely be responsible for the necessary modifications.
6. Have the vehicle inspected by a trusted mechanic
Using a trusted mechanic to inspect a car before purchase can help you avoid headaches down the line, especially when buying a used car from a private seller. If the car is several states away, it’s possible to find a local mechanic that inspects it on your behalf before you make a long trip to see the car. This could save time and travel costs if the mechanic finds serious problems.
The inspection process can serve for more than just your own peace of mind. Some states require car inspections during the transaction as a safety measure for buyers. Your local DMV should be able to provide more information on this.
7. Register and insure the car
As with any car purchase, you’ll need to register your new vehicle in the state you’ll be driving it in. In many states, you usually have about 30 days to complete registration. If the vehicle is under any special title type, it must be registered in compliance with your state’s regulations.
A car should never be taken out onto the road without proper insurance coverage. If you intend to purchase a vehicle out of state, speak to your insurance company and explain the situation to them. They can advise you on available options to ensure your new car has coverage before you drive home.
8. Obtain the title
In certain circumstances, the seller may provide the title when you pay for the car and take possession of it. However, this may not always be the case. Depending on the specifics of the sale, it may take up to a few weeks before you receive a title. In this case, it’s best practice to check the status of the transfer periodically.
Buying a car out of state from a private seller vs. dealer
The steps above apply to any car bought out of state, whether it's from a private seller or a dealership. At a dealership, they’ll typically help process and file many of the taxes and paperwork mentioned earlier. In private sales, you’ll likely have to handle that on your own with the seller.
Additional considerations
If you’re planning on buying a car out of state and driving it home, it may be helpful to review the laws of all states involved. For example, some states require the vehicle’s plates to stay with the vehicle, while other states may require the plates be removed and returned to the DMV (unless they’re being transferred to another vehicle). As a new owner, you may be required to get temporary plates for the drive home. Temporary plates are usually valid for a set amount of time, which varies state-to-state. It's best practice to check with the DMVs in each state for more information.
In summary
If you find a compelling car deal across state lines, understanding how the buying process works can help make the transaction as smooth as possible. While buying a car out of state from a private seller will typically require a little more research and planning, you might just end up with a deal you may not have found otherwise.
