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How to Sell your Car

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Last revision: June 11th, 2019
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Category: Daily Life
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Selling a car can be both a really fun thing to do and also a really stressful thing to do. Although most of us sell our old cars when we're ready to purchase or lease a new one, it can be a lot of work to prepare everything needed for the sale and find a good buyer. It can also be a little nerve-wracking to try to get the price we want, especially if it's critical for that new purchase or lease!

Before selling your car, it's helpful to decide what type of buyer you plan to sell to. For example, if you sell to a dealership, rather than a private, individual buyer, many of the initial steps are the same, but you likely won't have to advertise the sale and the dealership will likely provide great assistance to you in the closing. When you sell to an individual buyer, you'll have to manage all of that yourself.

In this guide, we'll discuss the most important steps for selling your vehicle - no matter what type of buyer you choose to sell it to. Before we get started, please keep in mind this guide is not meant to constitute legal advice and instead should be taken as purely informational.

Here are the steps you should take when selling your car.


1. Collect all of the important documents for your car.

The first step in selling your car happens much before the actual sale: gathering your documents. You won't be able to sell your car unless you have the specific documents needed to eventually close the sale and transfer ownership to the buyer.

The documents to gather at this stage include your car's title, any loan paperwork, if applicable, the car's service and inspection records, and the original sales documents. You'll also want to get a vehicle history report from a reputable company like CarFax.

The car's title is the most important and the most straightforward of these documents: it's the piece of paper that gives you legal ownership of the car.

If you still owe money on the vehicle, it will likely be more difficult to sell it, but either way, you should check with your lender for any documentation you may need.

These days, it's important to have the vehicle's service and inspection records during the time you owned the car to prove to any potential buyers (individual buyers or dealerships) that you took care of the car really well. A vehicle history report, which would show accidents the car has been in, would further bolster evidence of the condition of the car.

Finally, the original sales documents are good to get together, because they'll often show the specific features of the vehicle that you may not remember. You'll obviously know the year, make, and model of the car, but you may forget about its power features or engine or any other special notes the car has.

At this stage, it may also be a good idea to check in with the Department of Motor Vehicles (DMV) where the car is registered to find out what paperwork you'll need for the sale. At the DMV, you can also find out what to do with your plates after the sale or if they get transferred to the buyer.

At this point, you may wish to start thinking about a Vehicle Sales Agreement. This is a written document that will govern the terms of sale.

Although this seems like a lot of paperwork, this is a critical first step in selling your car.

Final takeaways

1. Get the car's title, service records, and original sales documents together.

2. Check on any loan paperwork needed.

3. Check in the with the DMV to see if additional documents are needed.


2. Obtain a valuation to set an asking price.

The next important step in selling your car is to get a good estimate on its value so that a proper asking price can be set.

Unlike real estate, generally, a car valuation isn't received from an individual that assess the car and sets a value. It can be done that way, especially if you are new to car selling and would like someone's assistance in setting the asking price, but most often, it's done through the Kelley Blue Book, which provides an estimate of how much your car should be worth based on several different factors.

You can also use Edmunds, which is a similar service. Many other online services also have similar valuation tools, like CarFax, discussed above.

If you do decide you want an individual to help you, generally you can find such assistance at your local mechanic shop. There, you can get an inspection of the car to figure out how much it is really worth.

Another good way to get an idea of what you can actually get for your car is to browse through local ads and see what comparable cars are being listed for.

Once you've figured out how much the car is worth, it's time to set the asking price. Set the price in a range where you make money, but it's not such a bad deal that no one will pay.

Final takeaways

1. Value the car from Kelley Blue Book or a similar service.

2. Consider taking it to a mechanic for an inspection.

3. Set the asking price.


3. Prepare your car for sale.

Now that some of the paperwork and accounting is out of the way, it's time to focus on getting the car itself ready for the sale. This means making it look as brand new as possible!

The first thing to do is take all of your personal belongings out of the car. Check everywhere, including the glove compartment and trunk, to make sure none of your items remain in the car.

After that, it's time to clean. Instead of just washing the car yourself, consider taking it to get detailed, to really ensure that it is as clean as possible in all the nooks and crannies. Simply giving it a wash probably won't do if you want to sell the vehicle.

At this point, you should also consider fixing any lagging items that you may not have gotten to yet. If you received a total inspection from a mechanic in the prior step, you should have a good idea of what needs to be fixed prior to sale. Usually, not fixing an item causes a greater dip in price than it would cost to fix it, so it's always a good idea to fix any items that need repair.

Final takeaways

1. Clean the car of your personal belongings.

2. Get the car detailed.

3. Fix any lingering issues.


4. Advertise the sale.

This step might not be necessary if you've decided to sell your car to a dealership or big company. In that case, you'd simply go to the dealership or website and talk through the options for sale.

If, however, you've decided you'd like to sell your car to a private buyer, it's now that you should think about advertising. Think outside the box here, as advertising doesn't have to mean putting an ad in the local paper. Advertising can mean telling friends and family and asking them to spread the word, using online consumer marketplaces like Craigslist or Facebook, and even posting on local bulletin boards around your community.

Whether you decide on a printed ad or online advertising, it's a good idea to have high-quality photographs to go along with the text, so that people know what to expect before they contact you. You may also wish to use a phone number other than your own, like a temporary virtual phone number, to ensure you stay safe.

Final takeaways

1. If you haven't already, decide where you'll be selling the car.

2. Take some photos of the car for the advertisements.

3. Advertise through many different means.


5. Meet with potential buyers.

Hopefully, by now, you've received at least a few contacts. Now, you'll want to meet with and screen the potential buyers. This step can be disregarded if you've decided to sell to a dealership.

The first step in meeting buyers is usually just to chat with several of them on the phone to see who sounds like they would be a real buyer, rather than just someone looking to waste your time. After you've screened potential buyers this way, you may want to set up a time to meet them and have them see and potentially drive the car. For safety reasons, it's usually a good idea to meet any potential buyers in a public place, instead of inviting them to your home or going to theirs. If you allow a potential buyer to drive your car as a test, it's not a good idea to let them go off with the keys - instead, go with them and sit in the passenger seat. Consider having friends or family come with you to this meeting to stay as safe as possible.

Hopefully, through this process, you'll be able to narrow it down to one buyer ready to purchase the vehicle.

Final takeaways

1. Talk to your potential buyers to get a sense of them on the phone.

2. Set up a meeting, in a public place.

3. Consider allowing a test drive, but make sure you go with the potential buyer.


6. Close the sale.

You've found a buyer, congratulations! Now it's time to close the sale. Since you have all the documents ready, this step will involve completing the Vehicle Sale Agreement with all of the details of the sale and then getting the money from the buyer before you transfer ownership.

The Vehicle Sale Agreement should cover all of the relevant details of sale and be signed by both parties. After that, you're nearly done!

If you've decided to sell to a dealership, they will likely have their own agreement.

For the safety of both yourself and the potential buyer, when the buyer is an individual, you may wish to use a vehicle escrow account where the buyer can deposit the money and you can transfer title. Vehicle escrow accounts allow a neutral third party, like a bank, to be the safe keeper between you and the buyer. The buyer can be sure they aren't giving their money to someone that will scam them and you can be sure the funds are secure before you transfer ownership.

Final takeaways

1. Discuss the closing with the potential buyer.

2. Consider using a vehicle escrow account to keep you and the buyer safe.

3. Ensure the money has been put in the account before you take any steps.


7. Transfer the ownership.

The last and final step is to transfer the ownership of the car. Usually, this is done by signing and transferring the title. It's then up to the buyer to properly register the car.

Your state may require additional documentation and if so, you can find that out at the DMV.

You should also ensure that you cancel your car insurance at this stage.

Final takeaways

1. Transfer title.

2. Check and make sure the DMV doesn't require you to do anymore.

3. Cancel your insurance for the vehicle.


Final takeaways

Selling your car can be a stressful experience, but it doesn't have to be. By following these steps, you'll ensure you have a smooth, productive, and safe experience selling your vehicle:

1. Be as safe as possible throughout the process, especially when dealing with finances or potential buyers.

2. Make sure you have your documents properly organized and ready to go.

3. After the car is sold, finalize any lingering issues, like closing the vehicle escrow account and canceling the insurance.


About the Author: Anjali Nowakowski is a Legal Templates Programmer at Wonder.Legal and is based in the U.S.A.


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