State Regulations in Michigan

When you're in the market for a car, first on the agenda is a warning: Caveat emptor―let the buyer beware. A car―used or new―is one of the largest financial expenditures you'll ever make. And you've probably heard this ad nauseum: It can be a daunting experience.

That's why it's important to do your research.

First, know what you want before you start looking. Need cheap transport back and forth to work every day? Or are you looking to haul the kids around town, or loads of lumber to job sites? What you use your vehicle for and what you expect of it are the first things you need to determine.

What can you afford to pay? Are you going to pay cash or take out a loan? What's your credit history look like? Know that the better your credit history, the better deal you'll be able to make. Those "zero down, low interest" deals are meant for consumers with the best credit histories.

Check out used car prices at Kelley Blue Book or the National Automobile Dealers Association.

Once you have those bases covered, start looking. Check out dealers and newspaper or online classifieds, and don't forget to look at those cars on the street with "for sale" signs in the window.

When you find one you like, take it for a test drive.

If you decide to buy a used car, make sure you check out the Federal Trade Commission's Facts for Consumers guide to buying a used car. It's got plenty of straightforward advice on what to look for and what to look out for.

If you're buying new, remember that competition really does control cost. Make sure you check out your car at a couple of dealers, and don't be afraid to negotiate. The saying "knowledge is power" never rings so true as it does when you go to buy a new car.

So You've Made a Deal

What's next? You have a few hoops to jump through once you've purchased a car, but it's a pretty easy process that you can take care of at any Secretary of State branch office.

Buying From an Individual

OK, you've taken a test drive, have had your mechanic look it over, and have checked the VIN (vehicle identification number) and odometer reading against the title, right?

If you haven't, do it. A test drive and inspection by your mechanic are cheap insurance against any major woes that might not be readily apparent.

The title will have the names of all current owners―including liens―on the front. All named owners must sign the title when the car is being sold. (In some cases, it's possible to sell the vehicle without the title. We'll get to that in a moment.) Make sure the mileage, selling price, and both your address and that of the seller have been printed on the title. You'll also need to sign it.

If you're buying a vehicle from an estate, you'll need a copy of the death certificate and letter of authority if the deceased's estate is probated.

It's a good idea to actually complete the sale at a Secretary of State branch office. That way, should any questions arise, you can take care of them on the spot.

Title transfers must be filed with the Secretary of State within 15 days from the date of the sale to avoid a late fee. You can register the vehicle at the same time, provided you have obtained insurance.

Buying From a Dealer

Ah, life has just gotten a little simpler. When you buy a new or used car from a dealer, you also pay for a little extra service. Forget about the trip to the Secretary of State's office; the dealer will take care of it.

In fact, here's what you can expect the dealer to do:

• Provide you with all necessary forms and ownership documents.

• Collect any fees and taxes that are due.

• File your title application within 15 days.

• Buy or transfer your license plate for you.

• Give you copies of all the paperwork.

Selling Your Vehicle

It was bound to happen once the baby was born. After all, the car seat really doesn't fit all that securely into the back, and, well, it snows so much you can never put the top down anyway.

It's time to sell the Porsche. Within an hour of your ad appearing in the paper, a guy shows up with a big smile and cash in hand―a no-haggle, I-want-THAT-car buyer.

Here's what you need to do once you stop crying.

Head over to a Secretary of State branch office with the buyer, if you can arrange it. On your title, fill in:

• The vehicle mileage

• The selling date

• The selling price

• Your signature

If you co-own the car, both owners need to sign. If there's a lien on it, you'll need to pay off the loan and have the lienholder sign the title also, or attach a lien termination statement.

The buyer will fill in their name, address, and signature.

If you don't go to a Secretary of State branch office, make sure you keep a photocopy of the front of the title after it's been filled out. Then remove your license plates from the vehicle (the buyer can drive home without a plate), cancel your insurance on the vehicle―and start that college savings plan.

Buying or Selling a Vehicle Without a Title

Buying or selling a vehicle from a private party with the title is much easier than attempting the transaction without one. If you're the seller and you can't find the title, you can always apply for a duplicate title.

But you can buy or sell a vehicle without the title. However, you will need to meet all of the following conditions:

• The buyer and seller must go to a Secretary of State branch office together.

• The seller will need to provide proof of the vehicle identification number, or VIN (the vehicle's registration card is a good way to handle this).

• The title must be on file in the Secretary of State's database.

• The title must be free of any liens.

Buying or Selling Without a Registration

You don't need to show the registration at the time of the sale (unless the title isn't available and you need it to provide proof of the VIN). However, showing it to the buyer may facilitate the sale by demonstrating that you've kept up with your vehicle paperwork.

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