Are you buying a used car from a private party? Great choice! Private party car sales in Arizona allow you to bypass the hassle of dealership fees and avoid the infamous annoyance of a used car salesperson. However, without the structure of a traditional dealership, you might not know what to look for in terms of vehicle inspection and information.
Fortunately for you, you’ve come to the right place. Today, we’re walking you through how to buy a used car in AZ—carefully and in compliance with state law.
Steps for Buying a Used Car in Arizona
Purchasing a used car from a private seller doesn’t have to be a daunting task. However, the car buying process isn’t as easy as going online, spotting a vehicle you like, and adding it to your cart. Before buying a car, you must verify the seller and vehicle information, inspect the vehicle, and confirm any liens.
1. Verify the Seller’s Information and Vehicle Title
First, verify that the person selling the car is the same owner listed on the vehicle title. The title should contain the owner’s legal name and address, along with the car’s vehicle identification number (VIN), the current license plate, model details, and the mileage when the title was issued. A look over the seller’s photo ID and vehicle documentation, like the title and registration, should be enough to confirm the seller’s identity.
If someone other than the owner is selling the vehicle, he or she must have prior authorization, such as a notarized power of attorney or court order. If the seller’s name is not on the title and there’s no proof of authorization, run, don’t walk away from the deal. The car may be stolen, salvaged, or rebuilt.
If the car is salvaged or rebuilt, it should have a salvaged title or a rebuilt title, respectively. Salvaged cars are deemed a total loss by the insurance company due to a severe car accident.
Salvaged cars can be rebuilt using parts and materials from other cars. This turns a salvaged car into a rebuilt car, and rebuilt cars should have a rebuilt vehicle title.
If your used vehicle does not have a clean title, know that you are undertaking more risk with your purchase. Likewise, be sure to examine both sides of the vehicle title and look for any alterations that would suggest it’s been tampered with.
2. Verify the Vehicle Information and Vehicle History
Next, be sure to verify the vehicle information. Use the vehicle identification number (VIN) listed on the title to cross-check the VIN sticker placed on the car’s dashboard and the VIN in the driver’s door jamb. All three should have the same exact vehicle identification number.
It’s also in your best interest to record the VIN so you can research the vehicle history before purchasing it. Websites like Carfax.com or Vehiclehistory.gov provide a breakdown of the vehicle’s past owners, as well as any documented damage and accident history. Plus, you should verify that the vehicle description attached to the VIN matches the make and model of the car you’re interested in purchasing.
3. Inspect the Vehicle Condition
After you’ve verified that both the seller and car are legit, it’s time to take a look at the vehicle’s condition. Online photos or videos don’t do a vehicle justice, so you must view the car in person.
Visually inspect the vehicle for any discrepancies and ask for a test drive to confirm all key systems are operating well. Additionally, it’s best to err on the side of caution and have a reputable auto mechanic or repair facility complete a full inspection of the vehicle’s electrical and mechanical systems. This is especially true if the vehicle has a rebuilt title.
The inspection should cover:
- Water damage
- Outstanding recalls
- Weathered or damaged parts
- Poorly or improperly repaired collision damage
- Safety conditions, such as the airbags and brakes
- Tire tread and alignment
- Engine, radiator, and hose condition
- Fluid levels
4. Confirm any Vehicle Liens
Once the car has been properly inspected and okayed for purchase, you must confirm if there are any existing liens on the vehicle. A vehicle lien is a document that gives another party the right to keep possession of the car until a debt has been paid. It’s in your best interest to purchase vehicles without any vehicle liens. If the vehicle you wish to purchase does have liens, be sure to receive lien release documentation before transferring the title.
Vehicle liens are classified into two categories: financial liens and alternative liens.
A bank or lender places a financial lien on a vehicle when the owner needs to make payments for the vehicle. For instance, if the owner took out a loan to purchase the car, the bank or lender can legally keep possession of the car until the owner pays off or transfers the loan. Financial liens are typically set for a specific number of months or years, such as a 36-month payment plan.
These liens are documented on the front of the vehicle’s title and are released once the debt has been paid to the lienholder. Once the liens are paid, the owner should receive a new title without any liens.
An alternative lien is placed on a vehicle when the owner has unpaid financial obligations that are not relevant to the car. The most common instances of alternative liens include unpaid taxes or child support. These liens are not lifted until the owner pays his or her respective debts to the lienholder.
Alternative liens are added electronically to the vehicle’s record and are not documented on the physical vehicle title. However, you can check both alternative and financial liens through the Arizona DMV’s Lien Motor Vehicle Inquiry and VIN database.
5. Transfer the Vehicle Title
If you’ve completed steps one through four and have decided to purchase the vehicle, Arizona law states you must apply for a new title within 15 days to avoid penalty charges. You and the seller can go to the Arizona Department of Transportation (ADOT) or an Authorized Third Party office together to transfer the title.
Alternatively, you can visit the ADOT alone, only if you have a complete bill of sale and the owner has completely filled out and signed the transfer section of the title.
If you have questions about either of those documents, we’ve got you covered in the next section.
Necessary Paperwork for Buying a Used Car in Arizona
Once you’ve completed a private car sale in Arizona, you’ll need to visit your local Motor Vehicle Division (DMV) to complete your registration. The documents needed to receive a new registration include the vehicle’s bill of sale, a completed title, a title and registration application form, and any lien-release documents if they apply.
What’s a Bill of Sale?
A bill of sale is essentially like your receipt for purchasing the vehicle. It must include:
- The name of the car buyer
- The name of the car seller
- The purchase price of the vehicle
- The VIN of the vehicle
Your bill of sale legally establishes you as the new owner of the vehicle, so it’s crucial you receive one with all of the above details. Registering and insuring a privately purchased vehicle with the MVD may prove difficult without a bill of sale to confirm your purchase.
How Do You Complete the Vehicle Title?
The bottom half of every vehicle title includes a section to “release interest in the vehicle.” This area of the title is where the previous owner will transfer ownership of the vehicle to you. The seller must sign and date this section, as well as list your full legal name and the current odometer reading at the time of purchase. Once the seller signs to release the vehicle to you, you must take this completed title to the MVD to receive a new title in your name.
Are There Fees for Private Party Car Sales in Arizona?
There is no additional charge for private party car sales in Arizona. However, you will need to pay a variety of fees to transfer the title to your name, register your new vehicle, and receive your license plates.
Typical fees for registering your new car in Arizona include:
- Title transfer fee: $4
- Vehicle registration fee: $8
- Public safety fee: $32
- Air quality research fee: $1.50
- Vehicle license tax (VLT): Varies depending on the assessed value and age of the vehicle
Be Wary of These Common Tricks
Unfortunately, when a used car is way too good to be true, it’s likely because there’s a bit of funny business going on behind the scenes. And while the above steps are incredibly helpful in weeding out potential duds, there are several common tricks to be wary of before purchasing a used car from a private seller instead of a car dealership.
Flood-Damaged Vehicles: Some cars appear to be in good condition, but water and debris have corroded, clogged, and/or damaged the engine and transmission. It’s wise to include water damage in your vehicle inspection before purchasing.
Improperly Repaired Vehicles
These automobiles have been seriously damaged in an accident and were poorly or incorrectly repaired, such that the mechanical system or parts of the body are now faulty. This is another reason why inspections are so important, especially for cars with rebuilt vehicle titles.
While a car might look great, it may have been illegally taken from the previous owner, and if the original VIN is intact, you could be held liable. Be sure to double-check a seller’s personal information and the vehicle title before agreeing to buy the car.
Manipulated Odometer Reading
Abnormally low mileage, like 10,000 miles for a 10-year-old vehicle, is a major red flag. You may need an odometer inspection from a trustworthy mechanic.
The “Lemon Law”
If you buy a defective vehicle, the car dealership you purchased from is responsible for your repairs under the Arizona Lemon Law. However, this law does not apply to private purchases or vehicles sold at a public auction. So, do not be swayed if a potential seller mentions the Lemon Law in your discussion.
Confidently Complete Your Private Car Sale in Arizona
From Phoenix to Scottsdale, thousands of Arizona residents ditch car dealerships to privately purchase a used car each year. It’s essential you have a basic understanding of how this car buying process works and what’s legally required from both parties before beginning the title transfer process. By knowing what to look for in a used vehicle and how to legally transfer the title, you can be cruising in your new (used!) car in no time.