Selling a car in California involves more than just your pink slip (vehicle title) and vehicle registration. There are certain title transfer documents that you must also provide. When selling a vehicle, there are some strict laws and guidelines that need to be followed. Every state has laws regarding the purchase or sale of a vehicle and California is no exception. So it is important that you understand what your responsibilities are. If there is anything you are unsure of, you should research the Department of Motor Vehicles (DMV) website.
Documents and Paperwork
Your California Certificate of Title or a REG 227 Application for Duplicate Title are some of the required documents you will need to have in your possession when selling your vehicle. At the time of the sale, vendor fees and use tax may apply, so you want to be prepared to deal with that. You will also need to surrender your license plates. If there is a lien holder on the vehicle, their signature along with yours will be required as well as the transfer fee. Additionally, you must also provide a smog certificate to the buyer.
Within 5 business days, you are required by state law to notify the DMV and report the sale of your vehicle. You will need to complete the Notice of Transfer and Release of Liability and mail the form to:
Department of Motor Vehicles
P.O. Box 942859
Sacramento, CA 94259
The form must be filled out in its entirety. Plus, all information must be accurate and correct. The vehicle’s record will not be updated should any information on the form be incorrect. In that case, it will be updated at the point when the buyer turns in an application for a new title on the vehicle. Until this occurs, the seller could be held liable if the buyer wrecks the vehicle in an accident because the state will still consider you as the owner of it.
Proof of Smog Certification
If the vehicle you are selling is more than 4 years old, it is your responsibility to provide proof of current smog certification. However, if the vehicle’s registration was renewed or originally registered within the past 90 days, then providing proof will not be necessary. Additionally, if you are transferring the vehicle title to another immediate family member, the proof of smog certification will not be required.
There are some additional exceptions to that smog certification requirement. A smog inspection will not be required if your vehicle is:
• a 1975 or older gasoline powered vehicle
• a diesel powered vehicle that was manufactured prior to 1998 or a vehicle with a GVWR (gross vehicle weight rating) of 14,000 pounds or heavier
• a hybrid
• a motorcycle
• a natural gas-powered vehicle with a GVWR of over 14,000 pounds
• a trailer
• an electric vehicle
Insurance Requirements
Other than New Hampshire, California and every other state in the US require that a driver have their state’s minimum liability insurance coverage. So it follows that the seller of the vehicle would have that minimum coverage. However, they may have recently cancelled that coverage and parked the vehicle in anticipation of selling it. Once the vehicle becomes the property of the new owner, the responsibility to pay for minimum liability and any other coverage that is needed now falls on that person.
Depending on whether the vehicle was included in a multi-vehicle policy or was covered by a separate policy, you may or may not have to cancel your current insurance. Every insurer varies so be sure you discuss this with your agent. You still have to notify them in the event that you sell one of your vehicles. So if the vehicle was part of a multi-vehicle policy, your insurance company will have to remove it and rewrite your policy. If the vehicle was covered by its own separate policy, then talk to your agent about cancelling it. Just be sure that you discuss the sale of your vehicle with your insurance agent so they can advise you.
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