Believe it or not, completing the paperwork for a car sale might be the easiest part of the entire car-selling process. Preparing all necessary paperwork on your own when selling your vehicle privately is more complicated than the actual completion of the sale and signing of documents. 

Certain circumstances make completing car sale paperwork easier or harder, though, and it is important to understand the situation you are in prior to sitting down at the table to complete the deal. The easiest paperwork to complete is for car sales where you (the seller) own the vehicle outright and have the title in your possession.

How to Complete Paperwork for a Car Sale
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This is true in every U.S. state although title transfer requirements vary around the nation.

If you are uncertain of state laws pursuant to transferring your automobile title to a new buyer, call your state DMV for up to date information and guidance.

If you have the title, fill out a bill of sale with your buyer. A bill of sale includes the vehicle identification number (VIN), sale price, odometer reading and relevant personal information for you and the buyer.

The next process is to accept the buyer’s payment. A bank-issued cashier’s check and an escrow service are the two best options for accepting payment. 

Avoid money wires. Cyber-based criminal activity is highly active in 2021 and a wire transfer opens you up to possible fraud/identity theft. Sign the title over to the buyer only after his or her payment is accepted/cleared. Next, you must contact the DMV within five subsequent days of the sale to clear yourself of any residual liabilities and responsibilities pertaining to your former vehicle.

If you still owe money on the vehicle your lender will also still have the title in its possession. The buyer either has to pay off the rest of your car loan on the day of signing to take possession of the title, or you will both have to sign a notarized bill of sale protecting the buyer from possible fraud until the car loan balance is settled. In the latter scenario the buyer takes the notarized bill of sale to the DMV and obtains a temporary operating permit. 

Once the car loan is paid in full, the lender sends you the title, which you must then send to the buyer immediately.

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