How to Buy and Sell a Car Privately

Selling Your Car
In most cases, you can sell your car on your own for more than you will receive by trading it in. However, prepping your vehicle for sale will take time and depending on its condition may also cost you some money. Assess the car’s condition, and then decide how much you want to spend on minor repairs, always remembering the liability involved with a private-party sale. These steps will help you get the maximum sale price for your vehicle:

1. Make sure it is washed, waxed and detailed.
2. Make sure it is mechanically sound and free from dents, dings and scrapes.
3. Make all repairs yourself rather than selling it “as is”.
4. Have your mechanic check out your car and issue a report about its condition.
5. Remove all of your personal items from inside the car, trunk and glove compartment.
6. Have all of your maintenance records ready to show.

Once the vehicle has been cleaned and repaired, you’ll need to determine what it’s worth. To research the wholesale value of your car (the price the dealers are paying), access the NADA Guide for trade-in and retail values on SCCU.com. Also check your local newspaper’s classified ads and newsstand publications to determine local market pricing. Using multiple sources helps assure that you arrive at a fair and realistic asking price. With this information, you’ll be able to come up with a price that should be lower than the dealer’s suggested retail price but higher than the price a dealer would pay for a trade-in. Your beginning price should be higher than the price for which you really want to sell the car. Leave room for negotiation.

The next step is to advertise. Start by placing ads in local classifieds or used-car publications and be prepared to advertise in multiple sources. Calculate the costs involved and make sure you can afford to run ads for an extended period of time if necessary.

Set aside time to field phone calls and meet interested parties for test drives. Prepare yourself for possible scheduling hassles like multiple buyers who want to see the car at the same time, and for negotiating in general. How low a price will you really accept? How will you handle competing offers and other dilemmas? Also check that your insurance will cover someone test-driving your car.

Of course, the prospective buyer will want to take your car for a test drive. First ask to see a driver’s license and insist on going with them on the test drive. For the sake of safety, let your family and friends know of your arrangements.

It’s always wise to put the sale and terms of the agreement in writing. A sample “Motor Vehicle Bill of Sale” can be found at the end of this article.

The laws governing the sale of motor vehicles vary somewhat from state to state. Check with your local Department of Motor Vehicles.

Once the vehicle is sold ask for a bank check/certified check. Have all owners listed on the title sign the title over to the buyer and remove the plates and registration tags. In some states, the license plates go along with the car. A new title will be issued and mailed to the new owner. This step may be a bit more complicated if you are still paying down a loan on the vehicle. If you can afford to pay off the loan and obtain clear title to the vehicle, then do so. If you need the funds from the sale of the vehicle to pay off the loan, you must contact the lender and ask how that can be arranged. If you still owe on the vehicle and your loan is with Space Coast Credit Union, simply call Express Services and explain your situation. The Express Services Representative will provide you with the information you need and set a time for you and the prospective buyer to meet at one of our convenient branches. The bank check can then be deposited into your account and you can then transfer the money over to cover the remaining due on the loan. The title will then be retrieved and can be signed over to the new owner. Once the title has been transferred, don’t forget to cancel your insurance on the vehicle.

Buying a Used Car
Used cars average 20 to 30 percent cheaper than new cars. You can get a car that’s as good as a brand-new car, without suffering the depreciation that hits new car buyers. But there are other good reasons as well to buy used:

• Used cars are more reliable than ever before.
• Many are still under the factory warranty.
• The history of a used car can easily be traced using the VIN (Vehicle Identification Number).
• Financing used cars has never been easier.

The initial stage of purchasing a used car from a private dealer involves deciding on how much money you have to spend. This requires researching what make and model car you want and can afford, and decide on what options you require. You’ll also need to check on dependability reports on the used cars you’re considering. These reports are published annually in Consumer Reports and are available at your local library. Set a target price or price range in which you think you can get the used car you are considering. This can be determined using the NADA Guides located on SCCU.com.

Once you’ve found the car your interested in via a newspaper ad, online source or friend/relative, call the party selling the car and get as much information as possible over the phone. The following questions will get you started:

1. Why are you selling the vehicle?
2. How many miles are on the odometer?
3. What’s the condition of the vehicle?
4. Does it have any special features?
5. Are you the original owner?
6. Was the vehicle ever involved in an accident?
7. Do you have service records for it?
8. How much are you asking for it?

Eliminate cars that have excessive mileage or a salvage title.
What is a salvage title? Effective May 1, 1991, if an insurance company made a total loss settlement on a vehicle, owners were required to apply for a Salvage title. A salvage vehicle is any title bearing vehicle that has been declared a total loss from Fire, Vandalism, Collision, Theft or Flood. Passenger vehicles over ten (10) years old are exempt from the Salvage title law. Please note, the salvage classification is permanent and remains part of the vehicle history. Many financial institutions will not lend against a salvaged vehicle, including Space Coast Credit Union.

If you’re still interested at this point, set an appointment to see the car in person and inspect the car carefully, looking for evidence that the car may have been in an accident or for excessive rust which is difficult and expensive to repair. Test-drive the car and verify that all the controls are working and ask if the factory warranty is still in effect. You may also want to consider taking the car to your mechanic to have it inspected more thoroughly.

While you have the car in front of you, ask to see the title, and compare the VIN on the title to the one on the car to be sure they’re the same. The VIN is located at the front of the dashboard along the windshield on the driver’s side, or on the driver’s doorjamb. You want to be sure the seller really owns the car. Confirm that the name on the title is the same as the name of the seller. Prior to making an offer, visit SCCU.com and run the vehicle’s VIN through our Carfax Lemon Check link. This is an easy, no charge way to get a vehicle history report on the auto. More in-depth reports are available at a discounted fee for all Space Coast Credit Union members.

Before you begin negotiations, determine what you want to pay for the car. Make your opening offer. If your offer is based on mechanical problems you found in the car, state the problems first, then make your offer. The offer should be high enough to be attractive to the owner, but leave room for you to increase your offer and still get a good deal. Be prepared for a counter offer. Once you reach an agreement on the price, get the sale and terms of the agreement in writing. A sample “Motor Vehicle Bill of Sale” can be found at the end of this article. The laws governing the sale of motor vehicles vary somewhat from state to state. Check with your local Department of Motor Vehicles.

Once the vehicle is sold, you may be asked to supply the previous owner with a bank check vs. a personalized check. Bank checks are available at any SCCU branch, and should be made out to the previous owner(s). It is vital that you verify that the person(s) transferring the title to you are those listed on the title. If there is more than one owner on the title, they all must sign for the transfer.

This step may be a bit more complicated if the seller is still paying down a loan on the vehicle. If the seller needs the funds from the sale of the vehicle to pay off the loan, the lender must be contacted and asked how that can be arranged. If the vehicle’s loan is with Space Coast Credit Union, simply call Express Services and explain the situation. The Express Services Representative will provide the information needed and set a time for the seller and you to meet at one of our convenient branches. Once the loan is paid off, the title will then be retrieved and can be signed over to the new owner.

If the seller is hesitant to meet with you at his or her financial institution to pay off the loan and transfer title, be prepared to walk away from the deal.

Once the sale is complete, take the transferred title to your local Department of Motor Vehicles to be assigned a new title and tags. When you are registering a used car you bought from a private person be prepared to pay the state sales tax.

Don’t forget to notify your insurance agent of your new purchase.

The information on this page is for educational purposes only. SCCU is not engaged in providing estate planning or other advice. Please consult with a competent estate planning professional regarding any specific estate planning questions.