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How to Buy a Car Out of State

You’re looking into Buying a car, but the one you’ve got your eye on (which fits your needs perfectly) is out of state. If you’re willing to travel to pick out your perfect car, there’s nothing wrong with doing so. However, there are some additional steps to the transaction that you’ll need to be aware of and be prepared for. Namely, you’ll need to understand state regulations regarding emissions and safety testing, best practices for transferring the title and registration, as well as potential differences in state sales taxes and proper insurance coverage for an out of state vehicle.

Before you decide on any one car, it’s important that you know what you’re looking for and do some serious research. Decide on a budget, choose a car that is practical for your needs, and understand how much the car is really worth. In addition, get the car’s full history and be prepared to negotiate price with any Seller. These are topics we’ve discussed in detail with several of our other car buying guides, so make sure to thoroughly read those if you haven’t already.

Know Each State’s Requirements

Once you feel confident in the above points, it’s time to move on to the next stage in the car buying process. When you have selected a car, there are some extra steps that you need to be aware of before you sign any paperwork from the seller.

Emissions and Environmental Regulations

Before you agree to anything, make sure that you take a look at your state’s regulations regarding emission testing and any other environmental standards. Go to your state’s website and search for any limitations or standards they might have set for cars coming from out of state. If any information isn’t clear on the website, I suggest calling your DMV directly just to make sure.

It’s possible that you already know about these types of tests if you’ve had a car before. Many states require emissions testing, but the frequency of tests differs depending on where you live. You might be required to test your car once per year or once every few years. Just make sure that you’re clear about these standards because you’ll likely have to get the car’s emissions tested before you can legally drive it in your state.

Safety Inspections

Again, this is something that completely differs depending on your state of residence, but you may be required to have your car safety inspected once you’ve brought it home. This isn’t a bad idea anyway, just to make sure that the condition of the car aligns with what you were told by the seller. This might be a mandatory step before you can legally drive it in your state, so make sure that you know whether or it should be on your list.

Legalities and Paperwork

When you buy a car in your state there is a fairly smooth transfer of ownership papers from the seller to you. When you purchase from a dealer, they will usually take care of everything for you. If you buy from a private seller, you will gain ownership of the title and registration, which you’ll need to take to the DMV and have entered into their system so that they know you are the rightful owner of the vehicle. However, when you’re buying out of state there might be a few additional things to be aware of.

Title and Registration

If you’re buying from a dealer, they will still set you up with temporary information that will last you until you get the car back to your home state. Although, once you’ve completed your journey, you’ll have to take the temporary title and registration information from the dealer to your local DMV and register it yourself manually. Dealers don’t have the authority to get everything transferred for you when you’re crossing state lines.

As far as a private seller goes, you’ll still need to take in your title and registration to your local DMV, but you may be required to coordinate information from the seller’s DMV and yours. They’ll need to be aware that you’ve purchased the car in their state and you’re taking it back to yours. So, be prepared for a DMV visit in more than one state if you’re buying privately. It’s possible that a phone call might suffice, but each state’s DMV regulations are different, so it’s not a bad idea to plan on stopping in once the deal is done.

License Plates

You’ll be required to change the license plates on your new car once you get back home. However, if you’re making a trip into the DMV anyway for your title and registration, they’ll likely handle this part of the deal for you at the same time. You’ll need plates that identify your current state of residence as well as up to date registration stickers to put on them.

Remember, if you’re purchasing a car from a private seller, you might not be able to get new license plates until you get home. As such, it’s vitally important that you keep all documentation on you at all times. If you are pulled over for any reason, you need to be able to prove that this is your car that was sold legitimately. If you’re uncomfortable with that idea, maybe think about having the car shipped home instead.

Sales Taxes

You’re ready to sign on the dotted line and make it official, but something to keep in mind is the sales tax. You’ll pay sales tax relevant to whatever state you’re currently purchasing the car in. When you drive the car home, you may be required to pay more sales tax depending on the rate of your home state. Keep in mind that you are completely responsible for making sure that you pay the proper amount of tax on your sale. It isn’t the duty of the seller to make up for any losses in cross-state sales. As such, it might be a good idea to do some research before you are ready to buy just to see what kind of taxes you might have to pay.

Insurance

No matter how you plan on getting your car home, you need to make sure that your car is insured before you drive it. Driving without insurance is very risky and could cost you a hefty fine if you get pulled over without coverage. Not to mention, if you get in an accident, you won’t be covered, so make sure that you talk to your insurance company about your new car right away.

What’s more, your insurance company might offer you a special deal on a newly purchased car. You might get a better rate for a certain period of time or they could even offer you free coverage briefly after you’ve purchased the vehicle. Give them a call before you purchase your car to see what kind of options they might be able to offer you.

Buying a Car Out of State and Having It Shipped Home

After the deal is done, you have two options for getting your car home — you can ship it or you can drive it. If you choose to ship it, you won’t have any issues with documentation (like we discussed earlier) if you get pulled over, but you will have to pay a significant fee for the transfer of your car. Shipping long distances and quickly can cost a couple thousand dollars. Although, you will likely have a few options depending on the company you choose to go with.

You might decide to allow the shipping to take a bit longer to get to you or purchase from a state that is a bit closer. Either of these options might lower the cost of shipment, but you’ve also got to consider how you’ll get there and home. Do some research of flights maybe even a rental car to see what is the most affordable option. Add all of these calculation to your total budget for the car and your travel. Likely, all of this information will help you make a decision about shipping or driving your new car home.

Buying a Car Out of State and Driving It Home

Now, if all of that seems like it’s simply going to be too costly, think about driving your car home instead. As I said before, if you go with this option it’s imperative that you have every piece of documentation readily available to you. You should be able to verify the sale at a moment’s notice if you are pulled over. Every state’s regulations are different so you should be aware that laws in one state may not be the same in another. This might be another point of research before you drive your new car home. As long as all of these bases are covered, you’ll be cruising home in no time.

A little bit of research and preparation is all it takes in order to coordinate a smooth car sale. Make sure that you understand the rules and regulations of your state and the one you are visiting and always obey and respect these statutes. With this in mind, you should have no problem getting the car you want across state lines safely.


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The post How to Buy a Car Out of State appeared first on Fiscal Tiger | A Resource for Personal Finance and Credit Card.



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