If you found your dream car for sale, but it has no title, should you still buy it? All cars have to have a title or title equivalent, this proves ownership and is a requirement for auto insurance. Without an owner and insurance, it can’t be legally operated on the road. So, why are some cars sold with no title?
Reason #1: The last title wasn’t signed over properly
Many cars are sold without a title because the last title was not signed over properly. If the seller bought the car, but the owner didn’t sign over the title properly, by purchasing the car you are receiving a skipped title. This means that the ownership assignment has improperly jumped owners—the chain of title has just been broken for no good reason. The seller of such a car is technically an “owner” and is supposed to have a title for it, but they don’t actually have one.
The bad news doesn’t stop there: A skipped title can also indicate other problems with your car. When someone fails to sign over their title correctly, they may have also failed to pay off all their loans on the vehicle, giving you unexpected debt on top of whatever money they’re asking for it. It’s also possible that they have failed to make certain legally-required disclosures about accidents or damage that may not have been properly repaired.
Reason #2: The vehicle was reported stolen
This is unfortunately an equally common scenario as a skipped title. If the vehicle was stolen, it’s likely that the seller has no title on hand. Most people do not keep their car title stored inside their cars for this reason. If the seller has the title in hand, you’d be able to see by checking their ID that they are in fact not the owner listed on the title certificate. Additionally, if they had the title in hand for you, you could run the VIN history to see if the vehicle had been stolen. By not providing you with the title, the scammer is hoping you won’t go through the trouble of requesting the VIN history.
Reason #4: The title has a permanent brand
A car may come with no title if it has a permanent title brand. It’s extremely important to know if the car you’re buying has a permanent title brand because it will impact your car’s eligibility to receive a title. If you decide to buy a car that has a permanent brand, you should be aware of its implications.
In certain situations, a car with a salvage title brand may be able to go back on the road. However, the inspection and repair processes for salvage vehicles may end up being more costly than the vehicle is worth. On the other hand, title brands such as junk, parts-only, or certificate of destruction are not eligible to receive a title and must be disposed of or sold for parts.
It may be difficult to identify a salvage vehicle or junk vehicle versus a clean title vehicle because not all branded vehicles will look damaged at first glance. Oftentimes the damage is under the hood or has been cosmetically fixed to look in mint condition.
Reason #5: The seller lost the title or it was damaged
Sometimes the answer is as simple as the seller lost the title or it was recently damaged and they need a new one. Assuming they were the last titled owner, this is usually an easy fix. If the seller has no title because the title was lost or damaged and they were the last titled owner, they can simply apply for a duplicate title in their state. Once they have received their duplicate title, then they can sign it over to you in a proper car title transfer.
Sometimes after the transaction is complete, the seller has no interest in helping the buyer. If you’ve already bought the car and the seller needs to obtain a duplicate title to sign over to you, remind them that until they do, the vehicle is legally in their name. Until they sign over the title to your name, they are responsible for taxes, fines, and fees on this vehicle.
Should you buy a car with no title?
Ultimately it’s your choice, but we do not recommend buying a car with no title. Even though there are many methods of title recovery, your money is at risk when you buy a car with no title. Until you have the title in your hand, signed over to you from the last titled owner, the car isn’t legally yours, you’ve just spent money on it. If the car is not eligible for a title, you’ll be out of the amount of money you paid for it. If you purchased the vehicle from a dealer, there will be resources you can use, but if you purchased from a private seller with no title, the recovery process may be much more difficult.
Not every car is eligible for a title, don’t accidentally buy a car that can never go on the road.