Buying a new car is an exciting adventure, but if you’re planning to buy it in another state, you need to be prepared for it. Finding a good deal and buying a car out of state is one thing, but getting a new car to a garage is another. Buying a car isn’t easy, and buying a car in another state can be even more intimidating. According to Credit Karma, you might consider buying a car from a dealer or out-of-state owner if you’re looking for a vintage or rare make and model, can’t find the features you want from a local dealer, or found a lot from an out-of-state dealer.
Crossing state lines to buy a car can help you get a better deal, but the process may be different from buying a car in your state. However, if the purchase is made across the country, shipping the car may negate any potential savings you earn from buying a car out of state. If you plan to ship the vehicle back to your home state after making the purchase, most of the tax-free savings can be offset by the transfer fee. While buying a car in another state may seem like a hassle, you still have to pay these costs before you can register your car and own it in your home state.
In either case, you will be required to pay for the new ownership and registration of the vehicle, sometimes as long as 30 days after you deliver the vehicle to your hometown. Typically, you will need to pay the applicable state sales tax before you can register the vehicle. If you plan to drive your vehicle in your home state, you will need to obtain a provisional registration so you can drive your vehicle earlier.
Most states require you to prove that you have auto insurance or self-insurance before you can own and register and legally drive a vehicle. To legally drive an out-of-state vehicle, you must have auto insurance or self-insurance. When it comes to auto insurance, you may be able to transfer your current auto policy to the new car when you buy a new car out of state.
Because the cost of different cars can vary, it’s best to review your car policy, even if you’re buying a used car out of state. If you choose a state where cars are cheaper to buy, you have the option to test different cars and then complete the transaction when you return home. Buying an out-of-state car can involve some extra work, but shopping is also a great way to find the car that best suits your needs. A third reason to consider buying a car out of state is that online shopping services like Carvana, Vroom, and Shift make it a lot easier to find out of state cars you might want to buy.
If you live near a neighboring state and want more options, or are considering buying a car online and traveling to another state to pick it up, it’s important to understand what you might be faced with when returning a new car to your country of origin. Once you return to your home state, you will need to register your new vehicle with your local motor vehicle department.
Before buying, make sure the vehicle can pass your state’s emissions test and MOT. If you live in California or a state that uses its standards, you will need to prove your vehicle is pulling to get title and registration. If it doesn’t meet their standards, or if it says “49 State Certified” and you’re returning to California, you’ll need to have your vehicle tested at a smoke control station and pay for any necessary modifications before purchasing the vehicle can be certified . It can be very expensive. Speaking of vehicle registration, depending on the state in which the vehicle was purchased, it may be necessary to obtain a provisional registration for the vehicle in order to bring it home.
Make sure you don’t need temporary registration in the state where you bought the car before picking it up. Taxes and Registration In most jurisdictions, you must pay sales tax when you buy a car in the state in which you register the car, most often the state in which you live. Before you take the leap, find out if you can register a vehicle in your state.
You will have to pay to get title and registration of the car in your country of residence, and you will most likely need to show a “Statement of Purchase” and transfer of title to prove that you legally purchased the car. If you plan to return your vehicle to another state within a short period of time, you can avoid paying sales tax entirely and only pay the relevant tax when you are registered and own property in your state. You must weigh these factors against issues related to buying a car out of state, such as shipping, insurance, inspections, registration, and sales tax. Other financial issues can arise when buying a new or used car out of state, such as where you buy the vehicle and the impact of provincial taxes on your bottom line.
Buying a car out of state comes with financial risks, from fraud and local taxes to temporary registration and the cost of transporting the car home. Also, the paperwork required to buy a car out of state is usually more difficult than when buying a car in your state. Buying a car out of state can make the deal more difficult, but knowing what to expect before you start shopping can ease some of that stress. Buying out of state can be a big problem, as it’s more difficult to evaluate the car in person.
