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How To Sell A Car To A Family Member – Is It Better To Sell Or Gift A Car To A Family Member?

Selling A Car To A Family Member

You have a car to sell, and you have a family member who has his or her eye on it. So, do you sell your vehicle to that family member? When it comes to how to sell a car to a family member, we have the information you need now! 

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Is It Better To Sell Or Gift A Car To A Family Member?

Regardless of if your Aunt Betty, Uncle Sam or Cousin Lynne is buying your car, that family member is now a buyer. Therefore, that buyer is now responsible for sales tax on the actual sale value of the car. Additionally, you as the seller are not liable for penalties even if the family member/vehicle buyer never pays. Perhaps this makes selling a vehicle a better choice than giving it to that cousin, aunt or other family member- which can bring in the gift tax into play. 


Selling A Car To A Family Member

When you decide to sell a car to a family member, it’s no different than selling that car to a dealership or a stranger that you find online. But the emotion behind it can make the sale a bit more complicated- particularly if you have loaned the vehicle to that particular family member. Sure, we love our family members (or at least most of them!) Furthermore, we are more prone to trust them when they say that they will make payments or pay for gas for the car, after they borrow it. But you protect yourself as well as the family member, if you treat the sale of your car as a business. You want a sales contract in place so that you are given a cushion- just in case something goes wrong. Your family member will see that you are a serious business person and take you very seriously as you sell them a vehicle. So, check out these steps as you prepare to sell your vehicle to that loving family member! 


Know the Value of Your Vehicle 

The first order of business for you to take care of, is to obtain a value for your car. You can visit the Edmunds or the Kelley Blue Book sites so that you know the approximate value of your car. This knowledge will help you to price your car fairly and accurately. After you have the value of your car, you can then discuss the price with your family member early in the game. Then, you can decide if you want to offer “family discount” on the car as well as who will finance the sale of the vehicle. Many car sellers choose to give a discount to family members who are interested in purchasing the car- while also taking care of the financing.   

Create An Agreement and Put in On Paper 

OK- So, now Cousin Kyle wants to purchase your great pickup truck. Great! Now is the time to form an agreement with Cousin Kyle and place that agreement on paper. This protects you as well as Cousin Kyle. 

You can also negotiate the terms of the car deal with your family member. You may want to take the time to discuss if a down payment on the truck will be required and how Cousin Kyrie will make monthly payments to you. Does Cousin Kyle have ALL of the money for the vehicle? Then there is no monthly payment that needs to be made.  But if you are financing the sale of the vehicle, you want to outline the interest you’re going to charge Cousin Kyle. You don’t have to create a complex or a wordy contract either. Just put in writing the terms, the amount of the monthly payments and be sure that you and your cousin agree to the terms. Be sure that both of you all sign the contract and each of you have a copy of the contract for your records. Are you going to charge your family member penalties for late payments? Outline that in the contract. What if Cousin Kyle misses two or three payments? Are you going to repossess the car? You want to outline all of the terms of your contract so that both of you are clear, and there isn’t fighting, arguing or court cases brought in the mix. One of the worst things in the world, is to sue a family member and have to appear in court for the disagreement. 


Make Sure That You “Seal the Deal” 

After you agree to the sale, it is now time to collect the payment or down payment for the car. Then as the seller, you must surrender the title over to your family member. After you sign over the title, your family member is the legal owner of the vehicle. Be sure that you take the time to record a precise odometer reading on the title too. In many states, you have to complete a bill of sale. So, make sure that you contact your state’s DMV or department of motor vehicle to see what is required in your particular state. 


Surrender the License Plate 

Don’t forget to remove your license plate from the vehicle. It will be the job of your family member to either register for new plates or just transfer your plates to the car that was sold. Your family member also has to have insurance on the vehicle too. No, you will not get into trouble if there is no insurance on the car, but you just want to look out for that beloved family member. 


“Tell Me More About Transferring A Car Title to a Family Member”

Transferring a car title to a family member, after the sale- is not a difficult process. You just have to follow your state’s rules and guidelines. Thankfully, things are done online, making the process a bit more streamlined these days.  Allow us to enlighten you and help make the process a bit better. 

What’s Required For a Transfer?

First, it is important to note that any certified paper or document that displays the legal owner of a vehicle is known as the vehicle title. You as the car seller have to have this title so that you can give it to the new owner of the car. If you don’t have the title, you have to go and get a duplicate car title. 


In order to successfully transfer a car title, you will have to officially change some details of the official possessor. The basic requirement for a transfer of car title is making the change of the name of the owner.  Two parties are involved with a title transfer. They include: 1. The person who is transferring the title, and 2. The family member who is taking possession of the car. 


You CANNOT sell a car to a family member unless you have the title or the lienholder. So, be sure to obtain one or the other. 

Selling A Car in Various States 

Let’s take a look at a few states and check out what’s required to sell a car in that particular state. 

How To Sell a Car in California 

In the state of California, once you sell your car to a family member, that family member has ten days after buying the car, to transfer ownership from the seller to their own hands. Additionally, sellers have five days after the sale, to report the sale to the California DMV. Additional steps include: 

  1. Read and gather your California DMV forms. 
  2. Obtain a smog certificate if your car is not exempt. 
  3. Allow your family member to inspect the car. 
  4. Gather your money to pay for any fees, transfer fees and other fees that are required. 
  5. Fill out all forms, sign them and submit them to the California DMV. 
  6. After you submit the forms, be sure to report the sale to the DMV. 

Click here to obtain more information! 


How To Sell a Car in Texas 

Texas states that a vehicle must be titled in the buyer's name within 30 days from the date of the vehicle. If you fail to properly transfer a vehicle into the family member’s name, then the seller risks facing penalties for toll violations, tickets or even any crimes that may be committed with the vehicle. Therefore, it is to your advantage to accompany your family member to the local Texas tax office so that this doesn’t happen, and a proper title application is filed.  Click here to read more! 

How To Sell A Car in Michigan 

Do you live in Michigan and are selling your car to a family member there? The state of Michigan requires that you accompany the family member or the purchaser of the vehicle, to a Michigan Secretary of State branch to ensure that the title is transferred into your purchaser's name.  Are you unable to do this? Then Michigan does allow a record of the sale that is no less than 18 months old.  Michigan also allows a record of vehicle sale to be a photocopy or a document that includes the following information: 

  1. The year, make and model of the car, 
  2. The VIN or the vehicle identification number 
  3. The address, name, driver license number and signature of the person to whom the car is sold
  4. The exact purchase price of the vehicle 
  5. And the date of the sale. 

Michigan law also states that the car seller isn’t liable for any damage that comes from the use of ownership of the vehicle by the family member/ vehicle purchaser- as long as the owner maintains proof of sale. Click here to learn more! 


How To Sell A Car in Ohio 

If you live in Ohio, then all vehicles are required to have a title which shows the current owner. Additionally, as you prepare to sell your car to your family member, you should do the following:  

  1. Let your family member look over the car. 
  2. Gather all documents and organize them. 
  3. Obtain and fill out an odometer disclosure statement. 
  4. Complete a bill of sale. 
  5. Transfer the title and get it notarized. 
  6. Remove your license plates and cancel your car insurance. 

You can also click here to read our complete guide! 


Can You Sell A Car To A Family Member For $1?

Yes, it can be done. When you sell the car to your family member for a dollar or any amount, you must follow a process that produces the required documents for your particular state.  You can also call or visit your state’s DMV or department of motor vehicles. There, you can find out what’s needed for a successful sale. We also wrote a great article on this subject that you can read by clicking here


Sell That Car To Cash Cars Buyer Instead! 

OK- So you have read our detailed article on how to sell a car to a family member and now you have decided to sell the car online. But wait. You can also sell your car to trusted, reliable and experienced car buyers, who pay fair market value! Sell that car to Cash Cars Buyer

We take the hassle out of selling your car to a family member, by offering you a quick, easy and streamlined process that puts cash in your pocket, FAST! With over a decade of vehicle buying experience, we buy cars, trucks, vans, crossovers and more! 

Selling Your Car Has Never Been Easier! 

Selling your car to Cash Cars Buyer has never been easier. Our process is fast, easy and free! 

  1. Review your offer. Once you have your offer, you can look at it and decide if you want to continue on with our easy and fast process. Once you love what you see, call us! 
  2. Contact us for a guaranteed offer. Give us a call so that we can ask you some additional questions about your car. After we complete our conversation with you, you will have a guaranteed offer on that car. Love what we just offered you? It’s time to get that car sold! 
  3. Once we have your approval, we are on the way! When you approve your offer, we will make our way to your location, to appraise your car, and then pay you on the spot! 
  4. We pay without hesitation! No need for you to wonder where your money is, once we appraise your car. We pay you on the spot!

Yes, it’s possible to sell a car to a family member. But for the fastest way to sell your car, you can count on and call Cash Cars Buyer! Leave the family car sale aside. Let’s turn that car into fantastic cash, fast! Click here to get started! 


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