Getting a new car is an exciting adventure, but if you’re planning on buying one in another state, you need to be prepared.
Why Buy Out of State?
Buying a car out of state is not for the faint of heart or the undecided. Maybe you’ve found a dealership that advertises great rates for first-time customers. Or maybe you see a car in the make or model you’ve been coveting listed online. You probably shouldn’t travel out of state if you aren’t certain that you want to buy the car in question, but if you’ve done your research and truly believe that your perfect car is worth the trip, continuing that thorough preparation will help make the experience easier, though it’s definitely not a breeze! Whatever your reasons for going the extra miles, sometimes the perfect car is worth the work.
Don’t Make the Trip for Nothing
Buying a car out of state takes a lot of time and effort. You don’t want to spend time researching and preparing only to see that someone else has already made moves to purchase the vehicle. But even worse than that would be driving across the country only to find out that someone got there before you. Before you get your show on the road, confirm (preferably in writing) that the dealership or seller is holding the car for you and that you have the necessary paperwork to make the purchase.
Know Your Home State’s Requirements
It makes sense: the state where you’re going to be driving your car is the state in which you should worry about the rules governing that car! You should contact the DMV in your state for the complete list of requirements.
Know Your History
If you’re looking to buy a used vehicle, before you ever leave the house or get your hopes up, it’s imperative to order a vehicle history report from a reputable company like CARFAX. Discuss any potential red flags with the seller before taking any steps towards making a purchase. In addition to things that impact the potential safety of driving the vehicle, such as crash or repair history, pay attention to shady issues that could cause financial trouble, like any liens that might be out against the vehicle. Wouldn't you be disappointed to drive your new car across the country, only to be chased by a repo man for someone else’s mistakes?
Keep It Clean
When it comes to acceptable emissions and smog levels for vehicles, different states have different requirements. It’s very important to know exactly what your state requires. If you don’t, and you bring home a car that doesn’t fit your state’s standards, you won’t be allowed to get a title and registration in your state!
Some of the cars you may be looking to buy may have an emissions inspection sticker. But don’t celebrate prematurely: make sure the state that did the inspection has the same or stricter requirements than your home state. If there’s no inspection sticker or the state that the inspection was performed in isn’t on your state’s approved list, you will need to bring your vehicle in for an inspection before you are allowed to get your title and registration. Check with your state’s DMV for the most accurate list of requirements.
California has the country’s toughest smog and emissions standards. Governed by the California Air Resources Board, these strict rules apply differently to new and used cars, but be careful: a car is considered “new” if it has fewer than 7,500 miles on it. If you live in California or a state that uses their standards, you will have to prove that your car passes muster in order to get your title and registration. It’s usually a simple process: in many cars, you can just lift up the hood and review the attached emissions label. Sometimes it is located on the inside of the door jam instead (check the owner’s manual if you can’t locate it). If the plaque or sticker says it’s 50-State or California Certified, you’re in luck! If it doesn’t meet these standards, or if it says 49-State Certified, and you’re headed home to California, you will have to have the vehicle tested by a smog station and pay for any necessary modifications before your vehicle can be certified, which can be very expensive.
There are some exceptions: used vehicles are generally only required to go through a smog inspection. Electric cars are exempt entirely for obvious reasons. If you took ownership of your car because of a divorce, because you inherited it, or if you’re buying it to replace a vehicle stolen or damaged while out of state, then you’re also off the hook.
Not all states require a specific safety check in order for your vehicle to be titled and registered, but many do. If you’re purchasing from an authorized dealer in such a state, they will often have already taken care of this for you. But all vehicles purchased out of state should have a pre-purchase inspection performed on them. You can find authorized mechanics all across the country, and while it may seem like a hassle, consider it a relatively cheap first line of defense against buying a vehicle that will have major problems a little down the road.
Title and Registration
If you’re purchasing your vehicle from a dealership, they will generally handle the paperwork required for securing a temporary title and registration that will allow you to legally drive your new vehicle home. If you’re buying from a private seller, you’ll need to do this complicated dance of working with the DMV in both your home state and the state in which you’re purchasing the vehicle largely on your own.
The private seller should, at minimum, give you a signed title and bill of sale so that you can prove that you are the vehicle’s rightful owner. Either way, you’re going to need to pay for a new title and registration for your vehicle, sometimes as few as 30 days after you bring the car to your home state.
If you’re purchasing a salvage title vehicle or rebuilt vehicle, the process will be even more complicated. A vehicle that doesn’t require the salvage branding on the title in one state might require it in another, so be especially sure to do your homework if that’s the type of vehicle you’re looking to purchase.
Pay Your Taxes
Although shopping for a car in a different state can feel taxing enough on its own, you’re still going to have to pony up for this expense before you can register your car and get a title in your home state. While you might think you can cheat the system by purchasing a vehicle in another state, you will owe sales tax on your new ride in your home state. As with the title and registration, many dealerships will handle part of this process for you. Just keep in mind that they’ll probably charge you the amount you’d owe if you lived in the state and that you’ll have to pay any difference between this and your home state’s rate once you arrive home.
Make sure to keep a record showing exactly what you pay and when you paid it—you’ll likely need this documentation at the DMV. Otherwise, you’ll likely have to make this payment at the time you attempt to register your vehicle.
Get Your Car Insured
Most states require that you prove you’ve purchased car insurance or are self-insured before you can get your title and registration and legally drive the vehicle at all. This is one of the most complicated steps, and you should highly consider talking to a trusted insurance agent well before your actual purchase of the car. Sometimes, your existing policy will cover a newly purchased vehicle for a short period of time, and sometimes it won’t. If you don’t currently have a car, you should take steps to make sure that you will be insured when you drive the vehicle off the lot. That is all the more imperative if you’re planning to take out a loan to finance your purchase or lease the vehicle.
Frequently Asked Questions (FAQs)
Is it legal to buy a car in another state?
Yes, but you must follow the laws of the state where you live for vehicle inspection, registration, and insurance.
Can I drive a car across state lines before registering it in the new state?
The laws vary for each state, so it's best to ask your insurance agent what applies in your case so you won't get caught with a violation.