5 Questions Answered: How Do I Sell My Used Car in Houston, Texas?

Every state has different rules and regulations when it comes to the purchase and sale of vehicles. If you have just relocated from out-of-state and looking to sell a used car there are a few things of which you should be aware. The following questions probably have different answers than those of your previous state. In the long run, failure to complete all the steps involved in transferring a title out of your name could end up costing you time, energy and money.

man shaking hands with used car buyer

1. How do I transfer a vehicle to an individual?

When you sell your used car to another private individual, you must be sure the title is transferred. First and foremost, this step protects you following the sale. Without a full transfer of ownership with your state’s department of motor vehicles, you can be held liable for toll violations, registration penalties, or tickets. You may even be held responsible if your former vehicle is used in the commission of a crime.

You should also note that all vehicle titles must be transferred within 30 days of being sold. To start this process simply fill out the “Title Assignment” form located on the back of the car’s title. However, it is further recommended that you accompany the buyer to your county tax office so you can be sure the transfer has been filed fully and completely.

2. How do I transfer my used car when I sell it to a dealer?

If you’re thinking, “I want to sell my used car to a dealer and use it toward a purchasing a newer vehicle”, then you should know that the transfer rules are a little different. Unlike a private party transaction, a licensed motor vehicle dealer is not required to title the car in their business’s name. This means that the vehicle’s title will remain in your name until which time another party buys the car from the dealer to which it was sold.

In order to protect yourself from any unforeseen circumstances, it is best to file a vehicle transfer notification with the DMV. This will tell your state office that you are no longer in control of, or liable for, anything that may happen with the car before or after it is sold to a new buyer.

3. What paperwork is required to sell a car?

When you sell a car, the DMV will require some specific paperwork to complete the transfer of ownership. You must provide the buyer with the signed title which will include the car’s odometer reading and the date of sale. In addition, you must also complete and sign an Application for Title and/or Registration form that needs to have the sale price clearly stated.

Other paperwork you may, but are not required to provide, may consist of warranty documents, copies of maintenance records for the vehicle. To ensure a good price for selling your used car, having the vehicle history report can help you assure the buyer of its reliability.

4. Who pays the transfer and registration fees?

Luckily, the hard-earned cash you receive for selling your used car will not be taxed and all the associated fees will need to be paid by the buyer. Depending on their county of residence, the buyer may need to have the vehicle inspected, and pay both the auto repair shop and the state’s DMV for a Certificate of Inspection.

Additionally, the buyer will pay the sales tax as well as the transfer, registration, and local county fees. The state will charge 6.25 percent of the vehicle’s value, not the purchase price, for the sales tax. Registration fees will cost the buyer anywhere from $30 to $50 depending on the type and weight of the vehicle. They will need to check with their county for an accurate calculation of those fees as they vary from one county to the next.

5. Do I need to keep copies of anything related to the sale?

Again, to protect yourself in the future, there are some pieces of information connected to the sale of your used car that you should retain for your own records. Keeping these records is recommended as there is not much of a paper trail in private party auto sales. You may even need this information if you ever have to prove that you are no longer liable for the vehicle.

The easiest way to keep complete records of your sale is to fill out a Bill of Sale and have the buyer review and sign the document. This simple piece of paper will record the buyer’s contact information, vehicle identification number, a description of the car, any known ownership history, the transaction date, and the purchase price.

Sometimes, as-is purchases of goods come with “buyer beware” warnings, but this can easily shift when you are selling a car. You are liable for a host of fees and legal complications upon selling your car if ownership is not transferred in a timely and complete manner.