Buying a used car from a private seller can get you a great deal, but can also leave you holding the bag if you haven’t done your due diligence.
This page will first cover the advantages and disadvantages of buying a used car from a private seller.
Then, we’ll go over the steps to buying a car from a private party and what you’ll need to do once the transaction is complete.
Still in the research and shopping phase? Be sure to check out our free VIN decoder for any vehicles you may be interested in.
Pros and Cons of Buying a Used Car from a Private Party
There are some advantages and disadvantages to consider when purchasing a car through a private seller versus a dealership.
Whether it’s the right choice for you will depend on the specific vehicle, the price, and your own circumstances.
Before we get into the steps to buying a used car in a private sale, we’ll cover the pros and cons.
The advantages to buying from a private seller include:
- Lower prices than the dealership.
- Not having to deal with a pro negotiator.
- Avoiding upsells and add ons that a dealership will try to throw in.
- A generally quick transaction.
- Most used vehicles are sold as-is.
Some of the disadvantages include:
- Having to do more of your own research before making the purchase.
- No dealer warranties or financing.
- Having to take care of all the paperwork yourself.
- No consumer protection laws or lemon law protection.
As long as you do your homework upfront, the advantages of buying from a private party can outweigh the disadvantages in many cases.
If it’s the right choice for you, continue reading to learn what you’ll need to do.
Steps to Buying a Car From a Private Seller
The first step to buying a used vehicle from a private seller is doing the research.
Start by searching local listings, car sale websites, and classifieds for the vehicle you’re looking for.
As you start to find what you’re interested in, you can begin by running the VIN through some free VIN decoders and the NICB VIN Check for stolen and damaged vehicles.
Look at KBB, NADA, or Edmunds to get a sense of the fair market value for that particular vehicle in your area.
If you find something you’re ready to move forward with, it’s time to contact the seller.
Use the email address of the phone number from the listing to start a conversation with the seller about the car.
Be ready with some questions that will help you decide whether or not you’d like to move forward. Check out some sample questions to ask when buying a used car below.
Be sure to get a vehicle history report for the vehicle so that you can check for any potential red flags.
If the vehicle history report comes back clean, you can arrange to see the car in person.
It’s recommended to meet the seller in a safe, public place where you can visually inspect and test drive the vehicle.
Additionally, you should arrange for a pre-purchase inspection conducted by a certified mechanic.
If everything goes well, you’re ready to negotiate the sale price. Once you and the seller agree on a number, you can pay and complete the paperwork.
Here are the documents involved in a used car sale through a private seller:
- Bill of Sale.
- Signed over title.
- Odometer Disclosure Statement.
In some states, the license plates will stay with the vehicle, while others will stay with the seller.
Sometimes it can be easier to complete the transaction in person at the DMV with the seller there.
If the seller claims they have lost the title, ask them to apply for a duplicate. It is unwise to purchase a vehicle without a title.
Questions to Ask When Buying a Used Car
Some good questions to ask when shopping for a used car include:
- Why are you selling the car?
- What is the vehicle’s maintenance history?
- Where do you get the vehicle serviced?
- How was the vehicle used?
- Any issues you notice about the car?
- Any notable repairs or damage?
- Were any parts replaced on the vehicle?
- When was the last vehicle inspection?
- Do you have the title?
- Do you still owe any money on the vehicle?
Avoiding Scams When Buying a Used Car
Unfortunately, private car sales are a common place where scams can occur.
Used car scams, especially on classifieds like Craigslist or Ebay, are more common than you may think.
You’ll want to do your due diligence up front to avoid getting scammed when buying a used car.
Some good ways to do that include:
- Running a VIN lookup to confirm that the vehicle is what the listing claims it is.
- Ordering a vehicle history report.
- Making sure the car isn’t stolen with a VIN check.
Some common used car scams to watch out for include:
- Someone trying to sell a stolen vehicle.
- Wire transfer scams.
- Gift card scams.
- Odometer fraud or odometer rollbacks.
- VIN cloning.
- Title washing.
- Undisclosed major repairs necessary.
What to do after you buy a used car from a private seller?
Once the transaction is complete and you’ve got your signed copies of the necessary paperwork, you’re ready to start the process of transferring ownership and getting the vehicle registered in your name.
One of the first things you should do after buying a used car is purchase a new car insurance policy.
Next, you’ll need to submit an application and the necessary documents to your state DMV.
The general process involves:
- Completing an application for a new registration and title.
- Providing the signed over title.
- Providing any other supporting documents such as the Bill of Sale and Odometer Disclosure Statement, if applicable.
- Paying the application fee, registration and title fees, and taxes.
Once this process is complete, the vehicle will now be titled and registered in your name.
Check the exact requirements with your state DMV.
When you buy a car from a private seller, can you drive it home?
Before you drive a used car you just purchased from a private seller, you should make sure you have an insurance policy for it.
The rules for driving the car after the sale will vary slightly depending on your state.
In many states, you’ll be able to drive the car to your house or to the DMV in order to get it titled and registered within the set time frame.
In some states, you’ll need to apply for a temporary registration that will allow you to legally drive the vehicle.
Be sure to check with your state Department of Motor Vehicles first.