Oftentimes you may find yourself in a situation where you don’t know what to do. Imagine this. You’ve gone to a car dealer and found a car that’s perfect for you. You’ve checked that it works fine, the engine is roaring and the wheels are moving. You’ve gone through the interior and are satisfied with it. You’ve even asked for the price and negotiated the rates. At the time of the payment or even after that, you are told by the car dealer that there is no title available for the car. Now you’re in a situation where you’ve bought or are buying a car with no title. So, What do you do?

Why is title important when purchasing a vehicle?

In a nutshell, the vehicle title proves the ownership of the car. So if you have a vehicle already, you must have its title lying around somewhere which would state that you own the vehicle. The title is not a deed but a certificate or a statement that contains information about the vehicle like its model, make, year, engine, and more. This type of information is essential in determining how much tax and registration cost is applicable to your vehicle.

A title is not only important for the buyer or seller as well. It contains information about when you purchased the vehicle among the many times it changed hands. As a seller, you need to keep the title of a vehicle for 18 months after you’ve sold the vehicle as proof of purchase. You need to take care of the vehicle’s title as upon losing it, the process of applying for a copy of the title from your local DMV can be a hassle.

Buying a car with no title can be a dodgy sale as in many cases, stolen vehicles or flooded cars are usually sold to unsuspecting buyers or those who have no idea of the importance of a title.

So now that you know the importance of vehicle title, what to do when you’re buying a car with no title?

What to do when you’re buying a car with no title?

Yep, the situation you’re in can happen to anyone. You’re at the buyer, select your vehicle and later you realize there is no vehicle title for it. In such cases, do what we do, follow the guidelines below.

Do you research

It’s always important to do your research before buying anything. In this case, before buying a car with no title, you can start your research by looking at the vehicle’s car history. A car’s legal status and history can easily be ordered from online registered companies like Carfax. A vehicle history report or VHR is important to find out whether the vehicle is clean, stolen, or salvaged.

VHR has information like when the car was purchased, who the owner was, when it was sold, was the vehicle involved in an accident, and more. If the VHR is not positive at all or feels like something shady might be going on, then follow your instincts and walk away. You’ll find another vehicle later, just as good if not better.

Get a bill of sale

Okay, so this is pretty straightforward. Since you know that you won’t be getting a vehicle title upon purchase, you need a document to prove your ownership of the vehicle in the future. Ask the seller to make a bill of sale before buying a car with no title or before making full payment.

The bill of sale should include VIN, odometer reading, sale price, and the items included with the vehicle. Make sure other terms and conditions are mentioned on the bill of sale. Personal information like buyers’ details and seller details (legal names, legal addresses, and phone numbers) should also be mentioned on the bill of sale.

Do note that when buying things, always pay in the form of a cheque or bank draft with an agreement. If the seller has promised to provide the title or any other documents after a few days, then you need some security to protect yourself. Paying cash would simply close the transaction with the seller not obliged to give you the remaining documents. Always have an agreement with the seller in place.

Get a duplicate copy

We mentioned earlier about getting a duplicate from a DMV. Although it can be a hassle, it is another option that individuals can choose to go for if they’re buying a car with no title. You can apply for a duplicate copy of the title or ask the seller to arrange it for you. It might take a few weeks before the DMV gets back with a copy of the title. Once the title arrives, then you can purchase the vehicle without any worries.

If you have a vehicle without a title and are looking to sell? Let us know. Click here to find out how to sell cars to car buyers.