Most people’s first car was or is usually an older one that they bought used. Buying used cars saves you a lot of money and gives you the chance to own luxury cars that would have been too expensive to buy when they were new. But there’s a catch: it’s not ready to drive right away like a brand-new car.
To buy a used car, you have to do a lot more than find someone who wants to sell their car, give them money for it, and drive it home. In addition to the transfer of funds, there is the transfer of the title, registration, insurance, inspection, and more. If you don’t know what to do after buying a used car, this article will be a great guide.
Follow along with this article to find out what to do after buying a used car.
What to Do After Buying a Used Car: Do this!
Title Transfer and Registration
If your “new” car is not properly registered with your local Department of Motor Vehicles, it is against the law to drive it on public roads (DMV). But if you buy a used car from a dealer, they will usually help you with the paperwork and fees from the DMV. By doing this, you can be sure that you have at least a temporary registration before you drive the car off the dealer’s lot.
In some states, you can get your permanent (metal) plates and finish the registration process at the dealer. If someone else fills out the paperwork for you, you will get the tags in the mail in about two to three weeks. In the meantime, they’ll give you a paper licence plate that you can put in the front or back window of your car. Still, some dealerships will tell you to go to the DMV and finish the process yourself.
A private seller is another way to get a used car. If you decide to go this route, you will have to go to the DMV to transfer the car title and register the car. You should also be ready to spend a few hundred dollars on the whole thing. Check your state’s laws or DMV rules to see what you need to do.
Warning: If you don’t have the right licence, registration, and insurance in or on your car, local police CAN give you a ticket while you’re driving home from a public or private sale.
Bonus Tip: Many states offer a “temporary plate” or permit that lets you drive for 1-3 days without official plates. You can buy it on the website for the DMV. You can print these out and put them in the car’s front or back window until you do the right paperwork.
To register your car, you will need:
Your name on the title or loan papers if you got the car through a financing company and the dealer is holding on to the title.
Proof that the car you bought is insured (call an insurance company and have them email you proof or have it faxed to the car dealership before you leave)
A report on a vehicle’s inspection (check local laws)
Test for pollution done (check local laws)
Multiple forms of ID, including one photo ID from the government
Proof of address, like a bank statement or a bill from a utility company
If you are paying for the car with a loan, the original title stays with the lender or dealer until the loan is paid off in full. You should be listed as a co-owner on the title. The finance company is listed as a lienholder on the title. The name of the lienholder stays on the title until the loan is paid off in full. Once the loan is paid off, the title is transferred to your name alone and a new original title is sent to you. If you buy a car outright, the dealer usually takes care of all the DMV paperwork and gives you the original title.
But some dealers and private sellers let you take care of the paperwork, which means you’ll have to go to the DMV. To go to the DMV, you will need a copy of the original title. You and the lienholder are both listed as co-owners on this copy. This tells the state that you are not the only owner.
This also protects the person who has a lien on the car in case you try to sell it without telling them. You wouldn’t buy a used car from a private sale if the title already had a lienholder on it. If there is still a balance on the original car loan, the lienholder, who is also a co-owner, could come and take the car from you.
After you pay off your loan in full, you need to transfer the title because as long as the title is in the seller’s name, he or she is still a co-owner of the car. This means that the only legal owner of a car is the person whose name is on the title. Most companies that lend money for cars want you to have full coverage insurance for the whole time you have a loan. This keeps them safe in case you get in an accident. Insurance with full coverage costs a lot more than insurance with only liability coverage. Once you pay off the loan, you can save money by getting limited liability insurance. But you can’t do this until you pay off the loan and get the title in your name only.
To transfer the title, you will need:
If the car has been owned and titled before, or if it is a used car, the current title.
A fully filled out bill of sale. It is proof that you bought something, so it protects you legally.
For cars less than 10 years old, the odometer must be shown.
Smog certification (check local laws)
You, as the buyer, pay the transfer fees.
A completed damage disclosure statement
Each state has its own rules about registering a car and transferring the title, as well as fees and taxes. Visit your state’s DMV office or the DMV website to confirm these details. You should always keep your registration information in the car after you get it. Or, just remember to put it in your car every time you drive.
Auto insurance premiums are a big part of how much a car costs to own. Still, almost every state requires that you have car insurance. Only New Hampshire and Virginia don’t have to do this. After getting their registration information, people who live in these areas can drive right away.
But it’s important to have car insurance before you leave the dealership, whether it’s required or not. If you don’t have proof of insurance, most dealers won’t even let you drive off the lot. So, it’s a good idea to get the car’s VIN (vehicle identification number) before you buy it and give it to your insurance company so that you’re covered when you drive it off the lot.
Talking to your insurance company ahead of time also lets you know how much collision, comprehensive, property liability, and bodily injury liability coverages cost. Having this information will help you better plan for all of your car costs. The budget for car maintenance should include money for insurance.
There are different types of car insurance coverage, and some of them may be required by law where you live. The cost of each varies depending on the type of car you buy, its value, your age, your credit score, your driving record, where you live, how high your deductible is, and so on. Most state laws require you to have coverage for both injuries to people and damage to property.
Maintenance and Repairs
Some sellers keep their cars in great shape, but others will drive them for many miles without doing the right things to keep them in good shape. So, skipping a post-purchase inspection could cost you in the long run when worn parts start to break. So, after buying the car, take it to a good mechanic to make sure it keeps running well.
Bonus Tip: A reputable car dealership should let you have your own mechanic check out the car before you buy it. Most auto repair shops will inspect your car and give you a list of what they find for less than $100. Think of this as a great investment that will help you buy a good car.
Most service packages for used cars include:
All filters, including the oil, transmission, air, and fuel filters, should be replaced, even if they look fine.
If you buy a used car, the fluids may need to be flushed, bled, or topped off. Some of these fluids are brake fluid, oil for the engine, transmission fluid, fluid for the power steering, coolant for the radiator, and windshield washer fluid. You should also check to see if any part is leaking fluid. Checking the fluids in your car and fixing any leaks as soon as possible can help keep systems from breaking down.
A brake system that works well helps make sure that a vehicle can be driven and controlled safely in a variety of situations. Repairing or replacing rotors and brake pads can also be very expensive. So, if you buy a used car, you should always change the brake fluid to avoid brake failure, noises from the brakes, and expensive repairs.
If you check the tread depth, sidewall surfaces, and air pressure of your tyres, you can fix any problems that might keep them from working at their safest level. When you have bald tyres or tyres with little tread left, they can blow out and leave you stranded. Make sure there is still a lot of tread on the tyre and that it is worn evenly. If your tyres are wearing unevenly, it could mean that they are out of alignment or that there are other problems.
When you buy a used car, you have to clean it inside and out. After all, you wouldn’t want to drive around in someone else’s dirty, soiled, trash-filled, and sweaty car, would you? So, if you want the inside and outside of your car to look like it came from a car show, have a professional clean it.
Before you bought the car, if you negotiated for other things, like an oil change or a longer warranty, make sure you have everything in writing. Also, if you negotiated for extras like seat covers, floor mats, a stereo system, or tinted windows, make sure these things are in the car, installed, or on it before you drive it home.
Don’t forget that the dealer doesn’t have to give you anything that wasn’t promised or written down. So, if you want to negotiate something, make sure you talk to the salesperson, the manager of the dealership, or the private seller before you buy the car, and then put your agreement in writing.
Read the Owner’s Manual
Yes, it’s not fun to read the manual. If anything, it is boring and a waste of time. Still, it helps to know when the car needs to be serviced, what the best tyre pressure is, how to use the different gadgets, how much fuel the car can hold, etc. By keeping up with your car’s maintenance schedule, you can keep it running at its best, keep or increase its resale value, and keep it reliable.
Without regular maintenance, your car’s operating systems and other parts will start to wear out and break down early, which will cost you a lot to fix. Checking the oil level, tyre pressure, and windshield washer fluid yourself takes only a few minutes and doesn’t cost much. But some car maintenance tasks can only be done by people who are licenced, trained, and have special tools.
Now, some people just use their car to get from A to B, but quite a few want it to feel like their own. And there’s no better way to do this than to add your own touches. But you might need professional help to make some of your ideas happen.
You can customise your car in many ways, such as with a custom paint job, personalised licence plates, custom car seat covers, new floor mats, a new dashboard, a reversing camera, a Bluetooth hands-free car kit, custom wheels, and so on. Make sure that the changes you make to your car follow the rules and standards for legal changes in your state.
Benefits of Buying a Used Car
A used car doesn’t have to be an old clunker with rusty wheels and chipped paint just because it’s used. There are some rust buckets for sale, but many used car lots have certified cars that look brand new. There are many good things about buying a used car, such as:
A lower price tag
Used cars are a lot cheaper than new ones. According to Edmunds, the price difference between a new car and a 3-year-old used car was 62 percent in 2018. This meant that, on average, you could save more than $14,000. So, you could pay off a used car much faster, saving you money on financing fees.
The bulk of the depreciation has already occurred
You may have heard that a brand-new car loses thousands of dollars in value as soon as you drive it off the lot. Yes, that’s right. On the way home from the dealership, the value of a brand-new car can drop by 11 percent. This means that your brand-new $25,000 car is now only worth $22,250.
It’s not over yet. As weeks, months, and years go by, the value of the car keeps going down. Some new cars lose as much as 40 percent of their value in the first year. On the other hand, a used car doesn’t lose value as soon as you drive it off the lot. Even though a used car will still lose value, it will do so more slowly.
When a car loses value quickly, the need for GAP coverage goes up. This is an extra cost. GAP coverage is optional insurance that covers the difference between how much you still owe on your car and how much it is worth right now. This is another reason why you should call your insurance company before you buy a used car. Find out what they think the car is worth and compare it to what the seller says it is worth.
No exaggerated fees
Dealers charge crazy, hidden fees like processing, shipping, destination, dealer prep, and advertising fees to people who buy new cars. These fees can cost as much as several hundred dollars! If you buy from a private seller, you can avoid many of these odd fees.
Dealers usually put on expensive extras, but a third-party installer can do it for a lot less money. You might not get all the features you want in a used car, but you won’t pay for anything you didn’t ask for. Also, putting in the features you want will be cheaper than buying a new car.
Lower registration fees
In most states, your annual registration fee is based on how much your car is worth and when it was made. It usually goes up the most in the first three years, then stays about the same for the next five. If your state has similar rules, buying a car that is at least three years old can save you about a thousand dollars because you won’t have to pay the fees for registering a new car.
Lastly, have fun with your new car. Take it on road trips, make it your own, and don’t forget to read the owner’s manual so you can keep it in good shape. We hope this article, “What to Do After Buying a Used Car,” was helpful.
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