Buying a Vehicle Out of State Means More Choices, More Considerations
1. It’s Legal to Buy Out of State
Buying a vehicle across state lines is very common and shouldn’t present a problem for most car shoppers. Many out-of-state car purchases occur in multi-state metro areas, such as New York City, Kansas City, or Washington, D.C., where crossing state borders is a daily occurrence.
2. More Cars to Choose From
Most people consider buying a car out of state because it gives them more cars to choose from. Online shopping tools such as Carfax Used Car Listings let you search nationwide. Your only limit is how far you’re willing to travel to pick up the car (although you can always have the car shipped).
3. May Be Cheaper Out of State
Manufacturer rebates, financing offers, and leasing incentives on new cars often vary by region. We’ve seen incentives on some models differ by as much as $1,500, depending on location. Check an automaker’s website to see whether the offers change based on location. A bigger rebate or zero-percent financing could make a longer trip worth the hassle.
Prices for specific types of used vehicles can also vary by region. For example, convertibles tend to be in greater demand – and command more money – in warmer climates than in colder ones. Conversely, 4-wheel-drive (4WD) trucks and SUVs tend to be more valuable in northern states than in the South.
4. You Still Have to Pay Your State’s Sales Taxes
It can be tempting to think you can save money by purchasing a car in a state with no sales tax, such as New Hampshire, and transporting it back home. However, you’ll need to pay sales tax in your home state. If you bought a car from a dealership, they will likely collect sales tax and pass it along to the proper agency in your state. You may also have to pay local sales taxes. If you’re buying a used car from a private party, you may have to pay taxes on the transaction price when it’s registered. Ask your local DMV rep.
5. Plan How to Get the Car Home
If you buy a car from a dealership, they should give you a temporary license plate.
If you buy from a private party, you’ll receive a signed title and a bill of sale from the seller that names you as the owner. Because you won’t have a license plate on the car, you could be stopped by law enforcement. Show them your ID, the title, and the bill of sale for the car.
Some states offer “trip permits” that let you drive an unregistered car for a few days – enough time to get it home and get it registered.
It’s a good idea to contact your insurance company immediately upon purchasing any car to be sure you’re covered for the ride home.
6. Register the Car Quickly
Each state allows a certain number of days to register a newly bought car at the local DMV. You’ll get a license plate and a new car title in your name, usually paying a fee. (If you are financing the car, the lender will be the title holder.) Bring along identification to the DMV: This typically includes a government-issued photo ID (your driver’s license should do), along with a utility or tax bill that proves your address. You’ll likely also have to show proof of insurance.
7. Make Sure It Can Pass Your State’s Inspections
In many states, an emissions test or smog check is required to register a car. To save you time and effort, it pays to check with your state DMV’s website beforehand to see what’s required. Have the seller provide proof that the car passed its last emissions test to avoid any surprises.
8. Be Careful & Get a Carfax Report
Be wary of out-of-town sellers who suggest a fund-transfer service. There’s a good chance the vehicle will never be delivered and you’ll never hear from the “seller” again.
Another growing problem is vehicle “cloning.” Here, thieves obtain a legitimate vehicle identification number (VIN) from a car matching the year, make, model, and color of a stolen vehicle, and then swap or duplicate the identifying digits. Be sure to check a VIN and decode its information.
Finally, watch out for “title washing.” This is where con artists illegally remove “salvage” or “flood” designations from vehicle documents to make wrecks look like problem-free models on paper.
To avoid issues such as these, get a Carfax Vehicle History Report before purchasing a vehicle. it will confirm the number of owners and the odometer reading, and it may also indicate if the car has ever been in a crash, flooded, or salvaged.
Next Steps
Yes, you can buy a car out of state. Car buyers do it all the time for a variety of reasons, especially in metro areas near state borders.
It can be cheaper to buy a car out of state. Regardless of where you buy a vehicle, you will need to pay taxes in your home state.
Registering an out-of-state car is easy. Bring along identification: This typically includes a government-issued photo ID (your driver’s license should do), along with a utility or tax bill that proves your address. You’ll probably have to show proof of insurance, as well.
If you have questions about this story, please contact us at Editors@carfax.com
