Buy cars without title can be tricky. You read reviews on-line, scouted car dealerships, went on several test drives, and finally found a car that suits your needs and your budget. Now, all that needs to be done is to reach an agreement regarding the payment method and price and transfer the ownership.
If the car in question does not have a title, it is important to know how to properly execute such a transaction in order to avoid unnecessary risks.
Why is it important to purchase a car with a title?
A car title is actually a formal document which proves ownership over the vehicle. Without a car title you will not be able to prove that you are in fact the owner of the car. Although many might believe that when buying a car, absence of a car title is a deal braker by using one of the following five approaches you will be able to purchase your new car and avoid any unnecessary risks.
First approach run a thorough checkup of the car’s background
Though in most of the cases a missing car tile should not cause any trouble, in some cases, a seller might tell you he lost the title in an attempt to conceal an unconvict truth like that the vehicle is stolen or a flood vehicle for example. A backup check can help you avoid such scenarios and can be done in three easy steps:
Check the vehicle’s history report
The first step is obtaining a report detailing the cars history. Such reports can be found online on designated VHR sites such as CarVHR, Carfax, AutoCheck etc. the report will list data about the car’s milage, title status, insurance claims and so on. If the data found on the report does not confirm what the seller told you about the vehicle it might be best to back off.
Compare information with the DMV office
after you checked the vehicle’s history report, contact the DMV office in your state. Use the vehicles VIN number in order to check the status of the car’s title and the history of the car as it was documented in the state.
Check if the car has been reported as stolen
You can do this by contacting the National Insurance Crime Bureau using the VIN number once again.
If after finishing those three steps no problems have occurred, you can proceed and purchase the vehicle. If you found out problems in the car’s history, it would be best to keep searching for a better option. If for some reason you could not complete all these steps, try using a different approach.
Second approach Obtain a proper bill of sale
Though filling out a bill of sale is an important part in any kind of vehicle transaction, when the car in question does not have a title, this part is especially crucial. This bill of sale should be filled out and signed before completing the payments for the car and should include:
Sales details
All the sales details including the vehicles VIN number, the type of the car, the milage of the car and the price of the car.
Personal information of the two parties
All the personal information of the two parties – the buyers and the sellers full name, address, and phone number.
Make sure to choose a payment method that can be confirmed later on in case there is a problem. Such payments methods include checks, or a bank transaction. Save a copy of this bill and make sure it is completed, signed and filled out correctly.
Third approach Have the seller obtain a replacement car title
If the car is registered at the DMV under the seller’s name, they can file a request and get a replacement vehicle title instead of the one they misplaced. It is important to note that this process might take a few days and if the information filed in the request are incorrect the request might be further delayed or even denied. Once the seller receives the new car title then you can proceed and purchase the car as you normally would.
Fourth approach locate the lost car title
All though this approach might be challenging at times, it is better to be safe than sorry, especially if the car is registered in a different state. To find the original title of ownership, go online and download the car’s history report using its VIN number. Using the record on the report, contact the DMV in the last state in which the car was registered and ask the contact information of the previous car owner, the one enlisted in the title of ownership. Call this owner and ask for their assistance in reissuing a title of ownership and transferring it on your name.
Fifth approach Find out if you can get a Surety Title Bond
Though this option is not available in all states, getting a Surety Bond is a great way to ensure your financial security when purchasing a car without a title. With a Surety Bond you can guarantee that the vehicle is yours and your money is not at risk. To get a Surety Title Bond contact the DMV and use the VIN number to check there is no lien on the vehicle. Once you made sure there is no lien on the car choose a Bond company that operates in your state. Usually, the Bond company will request a valuation of the car’s worth and other necessary details. After you submitted all the information the Bond company required you will be able to purchase the lost title bond through the company.
In conclusion, all though buying a car without a car title might be a bit more time consuming, it is not necessarily riskier then purchasing a vehicle with all the necessary documents. As long as you pay close attention to any red flags you might encounter and run a thorough back up check using the car’s VIN number, there is nothing to be concerned about.