How to Buy a Car From a Private Seller

You can get a better deal—and avoid dealer fees—when you buy your next used car directly from a private seller. There’s only one problem: private-party transactions are notoriously cumbersome. Or at least they used to be.
We built PrivateAuto to make private deals easy. From secure communications to instant payments up to $1M, our self-serve technology stack gives you dealer-like convenience in the palm of your hand. Browse used vehicles for sale to get started—and experience the PrivateAuto difference.

What are the Steps to Buy a Used Car From a Private Seller?

Whether you’re shopping for an electric car, a work truck, or a minivan, you’ll need to go through the following sequence to complete the private-party deal:

1. Determine your budget and vehicle requirements
2. Have funds ready
3. Find the right vehicle
4. Research the car
5. Test drive the car
6. Get an inspection (optional but recommended)
7. Sign the bill of sale (required in some states, recommended for all)
8. Pay for the car
9. Seller signs over the title to you
10. Get car insurance
11. Register the car in your name (at the same time, you’ll complete the title transfer and get new license plates)

First, you need to know what you can afford and what type of car you need. Next, you need to have the money to pay for it. If you can’t afford to pay upfront, you’ll want to secure financing (PrivateAuto allows you to secure a used car loan from our app).

Once you know what you want and how to pay for it—it’s time to go shopping.
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Where to Find Private-Party Cars for Sale

The best way to find used cars for sale by owner: go online and start browsing any of the many car-listing websites. Here are just a few examples of websites with cars for sale.

Local classifieds websites (for example, KSL Cars in Salt Lake City)
National classifieds sites such as Craigslist
Auction sites such as eBay Motors or Bring a Trailer
Online marketplaces such as CarGurus or Autotrader
Social media marketplaces such as Facebook Marketplace

While these websites may have a lot of vehicles listed, they have serious shortcomings. Most of them mix dealer inventory with private sales, making it difficult for you to know whether you’re getting a private-party car or not. Even more importantly, all of them lack basic transactional infrastructure.

We call them "meetingplaces" because they introduce you to a private seller and leave the two of you to navigate all the complexities of the transaction on your own.

PrivateAuto is the world’s first and only fully transactional automotive marketplace, offering self-service technological solutions for every stage of the deal.

We have nothing against other listing sites. If you find the perfect car on one of them, good for you. But we want you to have the transactional security and convenience that our users enjoy.

That’s why we developed DealNow. DealNow allows you to start a deal anywhere and finish it on PrivateAuto. Our fast-track dealflow includes convenient scheduling, electronic docu-signing, and instantaneous fee-free payments. Just create your own private dealroom, invite the car seller, and get the deal done.

Research the Car

A smart buyer will try to find out as much as they can about the car they’re getting. A vehicle history report can help you avoid buying a lemon and help you make sure you’re getting a clean title.

PrivateAuto has partnered with AutoCheck, which delivers the best value for the price. AutoCheck gets its data from Experian and includes a host of data sources, such as the following:

State Departments of Motor Vehicles (DMVs).
Auto auctions
Salvage auctions
Collision repair shops
Service records from maintenance facilities
Insurance companies
OEM manufacturers
Car dealerships and extended warranty companies
Import and export companies
Rental and fleet companies
Vehicle inspection and state inspection stations

Collecting from all these sources, AutoCheck reveals a wealth of info about the car’s history.

Title history: salvage titles, junk titles, flood damage, hail damage, storm damage, fire damage, and more
Major repairs
Regular maintenance (or lack thereof)
Manufacturer buybacks or lemon titles
Odometer rollback or not actual miles
City and state of previous registration, number of owners
Accidents and damage reports, stolen vehicles
Rental, taxi, lease, or government use
Lien information, ownership transfers
Collision repair history
Structural or frame damage
Service, repair, and maintenance performed
Total loss and reason for the loss
Stolen vehicles
Open recalls
Emissions records
And a lot more

You could say we’re big proponents of buyers getting a vehicle history report.

Arrange the Test Drive

At PrivateAuto, we let you arrange the test drive safely, easily, and conveniently, never revealing your personal information to the seller.

1. Our in-app scheduler lets you pick from the time slots the seller has chosen—no awkward back-and-forth conversations.
2. You can opt to transact with verified sellers only, which will help weed out those who prefer to operate in the shadows.

You’ll schedule the test drive in a matter of minutes without ever needing to contact the seller. It’s just one of the many ways we streamline the private car buying process.

Inspect the Car

We recommend a pre-purchase inspection by a professional mechanic. At the least, make sure to inspect the car thoroughly yourself.

Here are some key things to look for in a pre-purchase inspection:

Fluids: check all fluid levels, including engine oil, transmission fluid, brake fluid, power steering fluid, coolant. Look for leaks and make sure the fluids look clean and at proper levels.
Tires: examine tire treads and make sure there is sufficient tread depth. Also look for any cracks, bulges or other tire damage. Check the spare as well.
Interior: make sure all controls, electronics, air conditioning, and heating work properly. Look for any warning lights on the dash when the car is started. Check for water damage, stains, or tears inside.
Body: check for obvious damage, body panel alignment, uneven gaps, mismatched paint, signs of damage repair. Look closely for any indications of collision repair. Check for rust underneath and around various body panels. Check headlights, brake lights, and other lights.
Undercarriage: inspect under the car for leaks, rust, damage. Look at brake lines, exhaust, suspension components.
Maintenance records: review the vehicle history report and check maintenance logs to understand repair and ownership history.
Test drive: drive the car under different conditions to test acceleration, braking, steering, transmission, and to feel and listen for any mechanical issues.

Sign the Bill of Sale

Some states require a bill of sale in private-party vehicle transactions, while others don’t. Regardless of whether your state mandates one or not, a bill of sale is a good idea. It protects buyer and seller alike by proving that both agreed to the purchase. It memorializes the current odometer reading, purchase price, and other key details.

Fortunately, PrivateAuto has the buyer and seller each e-sign an official state bill of sale within the PrivateAuto mobile app. Both parties then have a record they can forever refer to—securely stored in their PrivateAuto account.

Pay for the Car

Now that the seller has signed the bill of sale, it’s time to pay them. The problem is, all traditional payment options have drawbacks. From cash to payment apps to cashier’s checks to wire transfers, existing payment methods are one or more of the following:

1. Risky
2. Time-consuming
3. Inconvenient
4. Subject to funding limits (usually $5,000)
5. Expensive

To remove payment friction from buying or selling a used car privately, we developed PrivateAuto Pay. After you experience it, you’ll wonder where it’s been all your life.

Here are a few of the advantages of PrivateAuto Pay:

Instantaneous: you can close a deal in the Walmart parking lot when you meet for a test drive and the seller will get their funds immediately—even if it’s 11:55 on Christmas Eve.
Fee-free: PrivateAuto does not take a cut of the transaction.
Available in all US states: no matter where in the US you’re buying or selling a vehicle, PrivateAuto Pay will work for you.
Large fund transfers: PrivateAuto Pay allows you to send any amount of money.
Remote transactions: do an over-the-phone deal with a seller in another state via a third-party agent who can be on-site and verify the pertinent details
Act as your own escrow service with our escrow-like safeguards

Sounds great, right? Our only question: why hasn’t someone come up with this years ago? Better late than never—and here it is.

Signing the Title

Once you’ve paid for the car, it’s time for the seller to sign over the title to you. This is a critical process and must be done very carefully.

Make Sure the Title is Valid

A crafty counterfeiter can make a realistic-looking fake title, with the state seal, watermark and all.

Some criminals will present a valid title for a different car than the one you’re buying. You’ll need to look closely to make sure the title matches the car.

Make sure the title is for the same make and model, color, year model, and trim type as the car you’re considering.
Check the car’s Vehicle Identification Number (VIN). Make sure it matches the VIN on the title.
You can find a car’s VIN on a plate which is located far-forward on the driver’s side dashboard. It’s positioned so you can read it from outside looking through the windshield.
The VIN may appear on other parts of the vehicle. A decal on the driver’s side door jamb is a common location.
A vehicle history report can reveal title discrepancies. When you buy with PrivateAuto, you can get a vehicle history from AutoCheck.

Verify All Details On the Title

Vehicle titles differ by state in the information they require, but make sure your title is completely filled out and the seller has signed it.

Here are the fields that most states include in the title. You should doublecheck that each is correct.

Sale price
Seller name
Your name
Seller address
Your address
Mileage (in some states)
Signatures of both parties with dates

Odometer Disclosure

Federal law requires a mileage disclosure for vehicles less than 10 years old. Some states have an odometer disclosure field on the title. Other states require a specific odometer disclosure statement be filled out.

Check with your state’s Department of Motor Vehicles (DMV) to find out specifics of completing the odometer disclosure—and whether your state requires any additional paperwork.

Get Car Insurance

Before you drive your new-to-you car home, you’ll want to have insurance coverage. At a minimum, liability coverage is required by most states.

If you’ve recently sold a car, you can probably transfer your policy to the car you just bought. Talk to your insurance agent about options.

If you don’t have insurance, PrivateAuto allows you to compare rates and get a competitive insurance policy from our app. Super convenient.

Registration, Title Transfer, and License Plates

After the purchase, you’ll finalize everything with the Department of Motor Vehicles (DMV)—or the equivalent organization in your state.

Register the vehicle in your name. Present the certificate of title signed by the original owner, as well as the signed bill of sale and proof of insurance.
Transfer the title into your name in the state records. Our complete title transfer guide shows you what’s involved.
Get temporary license plates (or temporary tags) so that you can drive the car while you wait for your new license plates to arrive in the mail.
Order new license plates unless you’re in California or Minnesota (most states require the seller to remove the plates).
Pay taxes and fees. Unless you live in a state with no sales tax, you’ll need to pay tax on the purchase price of your recently-bought car. Used car sales taxes vary by state; for example, Alabama has a 2% car sales tax, Nevada charges 8.1%, California charges 7.25%, Oregon has no vehicle sales tax, and New York levies a 4% vehicle sales tax. Depending on your location, you may have to pay additional local taxes and fees levied by counties or municipalities.
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State-Specific Guides

Check out these car buying guides for each state!

Used Car FAQ

When I buy a used car from a private seller, can I drive it home?

Check with the DMV in your state. Most states allow a short window in which you can drive a private-party car home after purchase, without being in violation of the law. You’ll then need to register with the state and get temporary tags.

How do you know if a private car seller is legit?

Should I give someone my VIN number?

What is the most secure form of payment when selling a car?

Is it risky buying a car from a private seller?

What is the smartest way to pay for a car?

What should I ask for when buying a car from a private seller?