People buy almost 40 million pre-owned vehicles yearly — that number is three times higher than that of new cars being driven off of lots worldwide. Despite the considerable market for used vehicles, though, finding a buyer can prove tedious if you don’t know what you’re doing. Creating an ad in the internet age couldn’t be simpler, but finding a serious buyer on the internet platforms can be a little more complicated. Learn how to sell a car privately and successfully with the steps below.

The 7 Documents You May Need to Sell Your Car Privately

The first step in learning how to sell a car privately is to learn how to sell it legally. Most states require these seven documents to sell a car to a private party.

1. Title

Transferring ownership of an automobile without a title is illegal almost everywhere in the United States. You can easily replace lost, stolen or severely damaged titles by filling out the necessary paperwork in person at your local DMV office or through its website. There is usually a small fee (around $25) for the replacement copy. You’ll need your ID, VIN, registration and possibly an odometer disclosure form to apply.

According to Kelley Blue Book (KBB), “In many states, the seller signs the back of the existing title along with the date, sale price and exact odometer reading before handing it over to the buyer. You should also make a copy of the signed title (both sides) for your records.”

In some states, older makes and models (at least 15 to 25 years or older depending on the state) do not legally need a title. If this is the case, you’ll need only a bill of sale to make the sale official. Check with your local DMV to see if your car falls under this exemption clause before transferring ownership without a title.

2. Warranty Documents

A transferable warranty can add to the value of the car, but you’ll need the documentation to prove its existence. It’s a good idea to write out the contact info for the company that issued the warranty so the buyer can have it transferred into their name after you close the deal.

Signing over a transferable warranty on a car

3. Records of Upkeep

Track down the paperwork and receipts for any car maintenance or services performed during the life of the vehicle. Potential buyers will want proof that you have properly cared for the car. Keep receipts of oil changes, tire rotation, brake pad replacement, engine repair and any other automotive work. Having detailed records of automotive maintenance may also increase the resale value of your car.

4. Certificate of Inspection

In Maryland and Alabama, you must obtain a certificate of inspection before selling a used vehicle. For this certificate, a state-approved inspector will look over the car to ensure it’s safe to drive and then sign a document stating that it’s operational and complies with regulations. Some states require periodic inspections for all cars regardless of transferred ownership. You can get a detailed listing of those laws from a reputable third-party source.

5. Odometer Disclosure Form

Per the federal Truth in Mileage Act, sellers must reveal in writing the exact mileage of the car at the moment of transferred ownership. Never round up or estimate when filling out this document. Both the buyer and seller will need to sign this at the time of sale. There are some exemptions for this form; you can read more about odometer disclosure forms on a Department of Transportation website.

6. Bill of Sale

Many states require a Bill of Sale when you legally relinquish ownership of a vehicle to another person. A Bill of Sale protects both the buyer and the seller. This document will list the VIN, selling price, vehicle mileage and the names and signatures of both parties. If you use the PrivateAuto listing service, you can find information about Bills of Sale, state documents and other title transfer information.

7. Release of Liability Form

Filing a release of liability form is incredibly important when finalizing the sale of your vehicle. This releases you from responsibility if the vehicle is damaged or involved in an accident after you close the sale. In most areas of the U.S., you’ll need to contact the DMV to file the release of liability, but in some locales you may need to file with the Department of Revenue or the Motor Vehicle Administration.

Set Your Asking Price

People in the market for a new ride will typically haggle in large increments, so it’s best to set your asking price about $1,000 to $1,500 higher than what you expect to receive. Appraisal tools like Kelley Blue Book are the easiest and most efficient way to find the going price for your specific vehicle. KBB takes into consideration your car’s make, model, condition, special features and any aftermarket add-ons when estimating the worth of your vehicle.

If you’ve browsed any online marketplace, you're probably familiar with lingo such as “OBO,” “OBRO” and “firm price” — but you may not be aware of their possible implications if you're just learning how to sell a car privately. OBO (Or Best Offer) gives the impression that you’re willing to haggle substantially and may attract people who aren’t ready to commit. This wording also makes it seem like you’re in a rush to be rid of the vehicle at any cost.

“OBRO” (Or Best REASONABLE Offer) gives the impression that you’ll allow a little wiggle room in the price, but you will not take less than the vehicle is worth. This lingo is more likely to attract people who are currently in the market for a vehicle and have the means to buy one.

Stating that your price is firm is pretty straight-forward. You know what the car is worth and you will not settle for less, even if it takes more time to find a buyer.

Holding a lot of cash in hand after selling your car privately

Consider Allowing Financing

Even if you already know how to sell a car privately, it’s natural to be wary of entering the world of financing. Allowing your buyer to finance a private car sale can open up opportunities for more potential buyers though. PrivateAuto makes it easy to accept approved financing, and a secure direct banking transfer of funds ensures you get paid in full.

Make Your Car Look Good

Besides adding to its appeal, detailing your car can also increase how much buyers are willing to pay for it. The most obvious way to spruce up the appearance of your used car is to give it a thorough wash and wax.

You can erase shallow scratches with an artist brush and a small vial of matching body paint, which you can purchase fairly cheap at most dealerships. You may also be able to pop out small dents and dings with inexpensive at-home repair kits. Make sure you read the instructions or watch an instructional video before you attempt to use these tools, as using them incorrectly can sometimes make matters worse.

Last but not least, don’t forget the air freshener. Scent-marketing is a very real thing, and studies show that the “new car smell” increases sales of vehicles.

Choose the Right Advertising Strategy

Many people advertise on social networking sites, but this isn’t always the best avenue when you're selling a high-ticket item such as an automobile. The problem with social media advertising is that it targets a large audience, which makes it difficult to weed out unserious buyers. You may get tons of messages asking if you’ll trade or accept a small percentage of your asking price — maybe even at 2 a.m. Not cool.

Choosing an online marketplace specifically geared towards selling cars privately is likely your best bet. Generally, people who browse these websites are in the market to buy a vehicle at that moment and are less likely to waste your time. Some of these online marketplaces charge a fee to post ads; this can range from $20 to upwards of $100 for “premium” features that claim to boost your ad to the top of the listings.

Interested in Selling Your Car? Try PrivateAuto

PrivateAuto knows how to sell a car privately and makes it easy for you to close the sale on your own. Avoid scams on other listing services thanks to the following safety features:

  • Instantly transfer funds to your personal bank through direct banking integration
  • Receive offers and messages only from verified buyers
  • Convenient financing options available for buyers

Protect your property and your identity with a secure selling service. Create a listing on PrivateAuto now that you know how to sell a car privately.