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My question is about the basic legalities of buying a car in the United States, not anywhere else in the world.

I have never bought a car before in my life.

I was looking at some used cars for sale on Craig's list.

I do not know what documents a buyer should ask for when the buyer contacts someone to buy a car.

I have heard people bandy about terms such as:

  • Vehicle identification number (VIN)
  • bill of sale
  • vehicle history

I do not even know what a legal "title" is.

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It's possible that things may vary by state, but in most places all you need is the vehicle title certificate (AKA "pink slip"). This is a document issued by the state Department of Motor Vehicles (or whatever it's called in your state). That is the "legal title".

Now the title certificate may show the seller as owner of the vehicle ("clear title"), or it may also show a bank or finance company as "lienholder". This means that the seller has an outstanding auto loan, which needs to be paid off when you buy the vehicle.

The vehicle identification number (VIN) is a unique serial number assigned to the vehicle when it was manufactured. Generally it can be seen by looking through the windshield from outside, at the front driver's side corner of the dash. It can also be on the driver's door jamb: https://www.carmd.com/where-to-find-vin-number/ The number will also be on the title certificate (and of course they should match :-))

You might also get a bill of sale showing the price paid, though often the price will be lower than what's actually paid, in hopes of paying less sales tax - which in many states you have to pay to register a vehicle. (Though some states get around this by charging a fixed amount...)

Vehicle history is something that (AFAIK) you have to pay for to get from companies like CarFax. The theory is that it will tell you something useful about the car's condition. Personally, I think it's something of a scam, like the extended warranties that telemarketers try to sell you.

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I have never bought a car before in my life.

I was looking at some used cars for sale on Craig's list.

This is potentially a problem. The person at the other end of the deal may be equally inexperienced. Or they may be very experienced or they may be shady.

The idea of paying thousands of dollars for a used vehicle is nerve wracking enough without the complexity of determining if the person in front of you is trying to scam you, and making sure that all the required documents are legal.

The first issue when buying any used car is making sure the price you negotiate is a fair price. You can research how much cars of that year, make , and model are going for. But you need to know how that particular one you are looking at compares to the average. Buying a used vehicle is time sensitive because that particular car might not be there tomorrow.

Getting past the price issue you need to see all the required paperwork:

  • Title: this shows ownership. Check the DMV website in your state to see what an official one in your state looks like. This should show the people and if there is a loan this should also include the lender. The VIN will also be listed.

    If there is a lender listed walk away from the deal. It is much more complex to complete the transaction. You need to make sure the lender is paid their portion of the proceeds to pay off the loan or they still own the car.

If there is a second person listed on the title they need to be there too. All the owners will need to sign the paperwork during this process.

If the title is from another state you have additional complexity. I would avoid this.

  • VIN: the vehicle Identification number. Every vehicle has one. They are in multiple places. One can be seen through the vehicle windshield. another can be seen on the door jamb. If they don't match the ones of the paperwork, that is a warning sign.

  • Registration. That is issued with the license plate. It will also have VIN, it should be current, and the names and addresses should match the owners. You should also check their drivers licenses to see if they are the owners.

  • Vehicle history. Is provided by a 3rd party. They can provide valuable information. sometimes the seller has one in advance. It should match the VIN. Some things it can provide: a list of previous owners; Estimated mileage' if there have been major repairs; if the vehicle was previously declared totaled by an insurance company. Getting vehicle history can save you from a scam. You will want to do this once you see the VIN, and you are thinking of buying the car.

  • The bill of sale. You will need to document to the state/DMV that you are the owner. This tells them what you paid, and is also signed by the seller. They may also have to sign the title and registration. This is legal document and must be accurate. Don't let the seller agree to put down a lower number. They may be trying to pocket some of the extra, and you will be committing fraud.

All these paperwork issues go away if you go to a legitimate used car dealer. Yes you may pay more, but the risk of finding out six months from now that you only think you own the car is eliminated.

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  • 1) It is not necessarily much more complicated to complete the transaction with a lender, if the lender has a local office. 2) There is no inherent problem with buying a car that isn't currently registered. 3) If I was selling a car, and a potential buyer asked to see my driver's license, I would tell them no. – jamesqf Oct 4 '20 at 16:13

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