Expect the best, but prepare for the worst. That’s a good rule to keep in mind, as most people are good and simply want to live the best life possible, but a few are set on breaking the rules for their own benefit. While it’s very rare, some car shoppers may try to take advantage of the situation by choosing not to register a car after purchasing it, saving them not just the cost of the registration, but also potentially from the penalties of parking tickets, traffic tickets, and possibly other crimes.
So, what can you do? Selling a car can be a profitable venture, but it can also provide an opportunity for unscrupulous humans to use the seller’s good name in a crime. It’s rare, but it can happen. Here’s everything you need to know if you transfer ownership of your car to a shopper who then fails to register it with the DMV.
Make Sure the Buyer Knows to Register the Car
Sometimes, the best course of action is to provide clear instructions to the shopper. Who knows? Maybe this is the new owner's first vehicle purchase, and they genuinely don’t realize they need to get it registered.
When a shopper buys a car privately from you, they need to take the transferred title to their local DMV office and register the car in their own name. This information might not be evident to the shopper, as all the paperwork would be taken care of for them if they were to buy from a dealer.
Unfortunately, if the new owner never registered the car in their own name, any parking tickets or driving infractions caught on camera will be under the seller’s name. If any crime is committed in the car, it’ll be the seller in the crosshairs of law enforcement.
Make Sure It Doesn’t Happen to You
Many states require private sellers to sign the back of the car’s existing title—along with the date, sale price, and exact odometer reading—before handing it over to the buyer. The buyer would then take the title with this information and register it. Unfortunately, short of conducting the sale at a DMV office, a buyer can’t be forced to register the car.
Be sure to make a copy of both sides of the signed title for your records. Also, make sure that the odometer reading is exact; it should document the moment ownership transferred from your name to the buyer’s name. If you round the odometer reading up to the next zero, and the buyer gets into an accident 5 miles later, they could claim you are responsible.
It’s also a good idea to complete a bill of sale. Have both parties sign it, create a copy, and then send the bill of sale to the DMV. If anything happens and the buyer fails to register the car, you’ll have the proof needed to say the car's ownership has been transferred and it is no longer in your name.
Some states require that the license plates be turned in upon sale, which is an extra step of protection and cancels the registration in the seller’s name.