Regardless if your vehicle has broken down or no longer fits your lifestyle, at some point you will need to purchase a new vehicle. But instead of purchasing a brand new car, why not consider buying a used vehicle?
Believe it or not, there are several good reasons why. For starters, between minimizing depreciation and reduced insurance costs and registration fees, it’s more cost-effective. And, thanks to companies like AutoCheck and CarFax, you can be certain that there’s nothing wrong with the vehicle because they can provide a history of the vehicle to make sure it wasn’t in an accident.
So now that you’re convinced that it’s worth your time and money to consider a used car, what do you do after you’ve made the purchase?
Here are the steps that you need to take immediately after buying a new car.
Title Transfer and Registration
You are not legally permitted to drive your new vehicle if it has not been properly registered. If you purchased the used vehicle at a dealership, the dealer will typically assist you with all the DMV-related paperwork and fees. This typically includes title transfers and registration. You’ll then receive your plates in the mail within 2-3 weeks. This ultimately means that you don’t have to make a trip to your local DMV branch.
But this isn’t a free service. So expect the dealer to charge you a documentation fee, or doc fee, for the time that they spent on the paperwork.
However, if you purchased a used car from a private seller, then plan on making a trip to the DMV. Also, expect to pay several hundred dollars to get the vehicle transferred and registered. This amount varies from state to state, so visit your state’s DMV website to see how much it costs to register your vehicle for the first time.
Before heading to the DMV to register your car, you will need the following:
- The title in your name
- A completed smog and emissions test
- A completed vehicle safety inspection
- Proof of insurance
- Multiple forms of ID
- Proof of address
Again, this varies from state to state. Make sure that you visit your state’s DMV website so that you can know the exact documents needed to register your vehicle.
As for the title, if you’re financing or lending the vehicle from a dealer, they’ll often hold on to the title until the loan is paid off. Once the loan has been paid in full, the title will be transferred to your name and mailed to you.
If you are not financing, the dealer will take care of all the DMV paperwork on the title to transfer the vehicle into your name.
If you purchased the vehicle from a private seller or a dealer, then you’ll have to visit the DMV and handle this on your own. In this case, you will need:
- The Manufacturer’s Certificate of Origin (MCO) (only if the car is brand new and hasn’t received a title)
- The current title from the previous owner — in most states you and the seller need to sign the back of the title so it can be transferred.
- Dealership invoice/bill of sale, odometer reading, and vehicle identification number (VIN)
Once you have the registration, keep that with your insurance cards in your vehicle, like in the glove box. But your title should be placed in a secure location, such as a fireproof lockbox in your home.
Used Car Sales Tax
If the vehicle was purchased at a dealership, then they will determine how much your used car sales tax will be. They’ll then include it in the final bill of sale. If you bought the vehicle from a private seller, then you’ll have to figure out this amount on your own.
If you’re stuck, then visit your state’s DMV website. Most of them provide fee calculators.
You cannot drive without insurance — even if you’re just driving the vehicle around the block. Before making a purchase, you should have your car insurance figured out. Talk to your provider and discuss your options — used vehicles usually only require just liability. This way as soon as you complete the purchase you can contact your insurance company, give them the VIN, and get the vehicle on your policy ASAP. If you don’t want to use your current car insurance provider or don’t have one, compare car insurance quotes online to find the best deal.
You may have to wait a few days for the cards to arrive in the mail, but at least your car is now insured. In fact, you can’t leave a dealership’s lot without proof of insurance.
Bill of Sale
The bill of sale is presented after the sale has been completed. It’s essentially a receipt that displays the purchase price, buyer’s name, seller’s name, and any related fees, taxes, and terms.
You’ll most likely need this document when registering the vehicle. It’s also used when the state agency calculates your used car sales tax. If you purchased the vehicle at a dealership, the registration and sales tax will probably be taken care of for you.
This only applies if you purchased the vehicle at a dealership. In this case, the dealership will provide you with temporary 30-day tags. This gives you a grace period until you’re able to register your vehicle.
Maintenance & Repairs
Finally, make sure that you read the owner’s manual. Not only will this tell you how to properly use your vehicle, it also should contain a maintenance schedule and warranty information. This way you can keep the vehicle’s regular maintenance schedule. Doing so will prevent you from having to pay for expensive repairs. And, more importantly, ensures that the vehicle remains in tip-top shape — which means it should have no problem passing inspection.