The Complete Guide To Buying A Car Out Of State




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If you’re in the market for a new or used vehicle, you might consider buying a car out of state. While this is possible, the process is more complicated than going down to your local dealership.

Here’s how buying a car out of state works and what you should know before you decide to do it.

Can You Buy a Car Out of State?

Yes, you can buy a car out of state. Just keep in mind that while you might find a good deal on an out-of-state vehicle, buying it might be a little tricky—especially if you’re purchasing from a private seller rather than a dealership.

How to Buy a Car Out of State

If you’re set on buying a car out of state, here are the steps to follow, depending on if you’re working with a dealer or a private seller.

Buying From a Dealer

In some cases, dealers in other states could have a larger inventory than what’s available on your local lots. Or maybe they simply offer a better price on the car you want.

Whatever your situation, you might end up having an easier time buying from a dealership compared to working with a private seller for an out-of-state purchase. This is because dealers are generally more experienced with the Department of Motor Vehicles (DMV) and can help you navigate the paperwork requirements.

If you decide to buy from a dealership, follow these steps:

  1. Make sure you want the car. It’s critical to be certain that the vehicle you’re eying is the car you want and worth making a round trip for—or shipping to your location if you buy it online. This way, you won’t waste your time with a complicated buying process if you end up changing your mind.
  2. Know the price. Double-check what the bottom-line cost of the vehicle is. This is the off-the-lot or out-the-door price, which includes the sale price, destination fees, sales tax and dealer fees as well as title and registration fees. Note that when you buy a vehicle out of state, you’ll generally have to pay sales tax in the state where you register the car, not where you purchase it.
  3. Place the car on hold. If you’re going to travel to the dealership, reach out to the dealer first and ask for the car to be placed on hold. It’s a good idea to get confirmation of the hold before you set off (in writing, if possible). This way, you won’t make the trip and find someone else already bought or is in the process of buying the car you want. The dealer can also verify what paperwork you might need to bring with you for an out-of-state purchase.
  4. Verify the requirements. Contact your local DMV to see what’s needed for an out-of-state vehicle purchase. For example, you’ll need to know what the smog and emissions standards are for your state as well as if a safety check is necessary.
  5. Check the car’s history. If you’re considering a used vehicle, be sure to look into the car’s history to know what you’re walking into. You can visit the National Motor Vehicle Title Information System (NMVTIS) to find a reputable provider for a car history report.
  6. Get the car insured. Before you can register the car, you’ll typically need to provide proof of insurance. It’s a good idea to discuss your situation with an insurance agent to see whether your existing policy (if you have one) will cover a new car for a short period of time or if you need to set up a new policy immediately. They can also let you know if you can drive your new car to your home state before registering it and what steps to take to avoid any legal violations.
  7. Complete the transaction. Either travel to the dealership or arrange for the car to be shipped to you to finish your purchase.

Buying From a Private Seller

Purchasing an out-of-state vehicle from a private seller will likely require more legwork compared to working through a dealership since you’ll need to consult with the DMV and complete the required paperwork on your own. However, you might be able to get a better price from a private party compared to a dealer, which could make the convoluted process worth it.

If you’re ready to buy from a private seller, follow these steps:

  1. Make sure you want the car. Just like buying from a dealer, purchasing from an out-of-state private seller comes with extra work—so it’s important to know for sure that you actually want the car before starting.
  2. Know the price. Resources like the Kelley Blue Book and the National Automobiles Dealer Association (NADA) can help you determine what you should reasonably pay for the vehicle. Remember to consider your state’s sales tax as well as title and registration fees in the overall cost.
  3. Contact the seller. Reach out to the seller to let them know you want to buy the car.
  4. Verify the requirements. Contact your local DMV to see what paperwork is required to buy a vehicle from out of state. At minimum, you’ll need the seller to sign over the title and fill out a bill of sale to show that you now own the car. You may also need to apply for temporary registration before you travel to see the vehicle. Additionally, some older or classic vehicles might not comply with air quality standards—so check to see what the safety and emissions requirements are for your state.
  5. Check the car’s history. If you’re buying from a private seller, it’s even more critical to do your research and look into the vehicle’s history. Visit the NMVTIS to locate a trusted vehicle history provider. It’s also a good idea to have a mechanic inspect the car before you buy it to see if there are any issues the seller didn’t mention.
  6. Get the car insured. Be prepared to set up an insurance policy for your new car before you can register it with the DMV. Remember to check with an insurance agent to see if you can drive the car across state lines before it’s registered in your state.
  7. Complete the transaction. If you’ve come to an agreement with the seller and arranged the necessary paperwork with the DMV, you’re ready to seal the deal and pick up your new car.

What to Consider Before Buying a Car Out of State

Knowing what to expect from an out-of-state vehicle purchase can help make the process less overwhelming. Here are some important points to research beforehand:

Your Home State’s Requirements

Each state has its own requirements when it comes to buying and registering a car. Be sure to reach out to your local DMV to get a good idea of what the rules are and what paperwork you’ll need to complete.

Safety, Emissions and Smog Requirements

Depending on your state, you might need a safety inspection for your car. While a dealer will typically take care of this for you, a private seller won’t—so if you need one, you’ll have to take the vehicle to an authorized mechanic. Even if a safety inspection isn’t required, it’s a good idea to have a mechanic look over the car just in case.

You’ll also have to make sure the vehicle meets the emissions and smog requirements for your state.

Vehicle History

If you’re considering a used car, it’s important to do your homework and look up the vehicle history through one of the NMVTIS sources. This will give you a comprehensive look at where the car has been—from the number of owners to any accidents to whether it has a salvage title.

Also double-check to see if the car has a loan on it and, if so, whether you buying the vehicle will satisfy the lien placed on it by the lender.

Taxes

Don’t think you can get out of paying sales tax by purchasing a car in a state that doesn’t charge it. You’re required to pay taxes in the state in which you register the car, not where you buy it.

Title and Registration

If you’re purchasing a vehicle from an out-of-state dealership, they’ll generally handle the title and registration paperwork as a routine part of the transaction. You can typically expect to be given a temporary registration that will allow the vehicle to be driven back to your home state.

However, if you’re buying from a private seller, you’ll need to work with both your local DMV as well as the DMV of the state where you’re purchasing the vehicle. You should expect to get at least a bill of sale and signed title from the seller, which you’ll take to the DMV to show you’re the new owner.

If you’d rather not deal with the hassle of driving the car back to your state, shipping the vehicle could also be an option—but this also comes with additional expenses. You can expect to pay anywhere from $500 to $1,700 in fees, depending on where the car is shipped.

Insurance

It’s best to check with your current car insurance company (if you have one) before you buy an out-of-state vehicle. In some cases, your existing coverage will extend to a new car purchase for a short period of time. If not, an insurance agent can help you set up a new policy as well as explain whether you can drive the vehicle back to your state before it’s registered.

Pros and Cons of Buying a Car Out of State

While buying a car out of state can be a hassle, it could also be worth it in some cases. Here are some pros and cons to keep in mind as you weigh your options:

Pros of Buying a Car Out of State

  • Wider selection: In some cases, it might be hard to find the exact car you want at your local dealerships, such as if you’re looking for a rare or antique model. By widening your search to out-of-state dealers and sellers, you could have an easier time finding what you’re looking for.
  • Could save you money: There are multiple factors that can impact a car’s selling price, such as location and demand. In some cases, you might be able to buy a car for less money by purchasing out of state—though remember that you’ll have to pay sales tax based on where you register the vehicle.

Cons of Buying a Car Out of State

  • More complicated: You’ll have to jump through more hoops to buy a car out of state—especially if you opt to purchase a car from a private, out-of-state seller. This can include working with your local DMV, researching paperwork and more. Additionally, you’ll have to figure out how to transport the car back home, whether by making a round trip or shipping it.
  • More time consuming: You’ll need to do plenty of research before buying a car out of state, which will be much more demanding compared to working with a local dealership.
  • Might be more expensive: If you choose to ship the vehicle back to your home, you’ll have to pay shipping fees, which can range from $500 to $1,700.

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