Further, buying an out-of-state car at Balise Mazda is actually pretty easy, because we take care of all of the tough stuff for you. Receive full access to our market insights, commentary, newsletters, breaking news alerts, and more. One great reason to buy a car out of state is if you find a nearby dealership who is offering a knockout deal on a particular vehicle or a special for first-time customers. If you’re buying a used car from a private party, you may have to pay taxes on the transaction price when it’s registered. In many states, an emissions test or smog check will be required to get a car registered, and that could delay your registration process. Once you have found the car of your dreams, assuming it is a new vehicle, it’s always a good idea to ask for a copy of the window sticker. If you are hoping to save some tax dollars by buying your car out of state, think again. See who has the best deals this month! Alabama … One-time purchase costs: $25. Maybe you’ve found a dealership that advertises great rates for first-time customers. If I buy a car in PA, will I have to drive it to Alabama to register it and get plates? There’s nothing to stop a buyer from crossing state borders to buy either a new or a used car. Crossing state lines is a challenging part of buying a new or used vehicle. Once you've decided that it's worth buying a car out of state, it's important to be prepared for some of the common pitfalls and obstacles you may face. Buying a car out of state - and I can't figure out the tax, title, and license fees for AL (Huntsville: sales) User Name: Remember Me: Password ... a cash purchase (mine was a new vehicle if that makes a difference I don't know). At a minimum, make sure you have the title of the vehicle and proof of insurance. They will usually help you with all of the necessary paperwork. If you plan to move from a state without sales taxes to one with sales taxes, you should buy the car and register it about three months before your move. Sometimes, when a person buys a car without doing enough research, being reasonable about finances, or comparing prices, he wants to return the car. It would be best if you tried to find a car you can afford that is located in your state or, at the very least, in one nearby. Also, do not forget to consider the sales tax rate. It's important to familiarize yourself with the regulations in your specific state. A new car is often the second largest purchase (after a house) that a person will make in a lifetime. If you’ve bought a car from a dealership, they will likely collect sales tax and pass it along to the proper agency in your state. Generally, when you're buying a car from an out-of-state dealership, the dealer handles all title and registration paperwork for you. Your registration process will be delayed if your state requires emissions tests. It pays to check with your state DMV’s website beforehand to see what’s required to save you time and effort. When you buy your car from a dealership in another state, they may have the authority to collect state sales tax and send it to your state along with other paperwork for the title and registration. This will help you prove that the car belongs to you if you get pulled over. Steps to Buying a Car Out of State First, obtain a vehicle history report for the car you plan to purchase. Ask preliminary questions before going to see the car. Research the car thoroughly. Use Carfax’s Service Shop Directory to Find Top-Rated Mechanics in Your Area. The Carfax Report may also indicate if the car has ever been in a crash, flooded, or salvaged. If the car you want is difficult to find or you have found it at a significantly cheaper price point, then it might be worth the trouble of buying it out of state. Carfax Used Car Listings Make it Easy to Find Your Next Car. You need to make sure your new or used car financing is worked out early on. You’ll receive a signed title from the seller that names you as the current owner, but you will have to transfer the title to your home state, and register the car there as well. Some insurance policies provide automatic coverage for a limited amount of time for new purchases. Call your insurance company before making the sale to ensure that you are covered in this scenario. Thinking about buying a new vehicle from another state in the hopes of avoiding taxes? Our expert team staffs DMV buffs who know all of the ins and outs of car registration, taxes, titling, and more. It's important to familiarize yourself with your area's emissions regulations before committing to a vehicle. You might live close to a state border. Typically, if you are buying your car from a private seller, the sales taxes will be collected after the actual sale. My weekly “Wheel Deals” newspaper articles are syndicated by CTW Features. No matter what your situation is, buying a car from a different state requires a couple more steps to help you avoid any issues along the way. However, there are a few things to consider. If you want to buy a car out of state, plan to see the car in person before you make your decision. Another growing problem is vehicle “cloning.” Here, thieves obtain a legitimate vehicle identification number (VIN) from a car matching the year, make, model, and color of a stolen vehicle and swap or duplicate the identifying digits. This will cost you some money up front, but it is money well spent. You may also have to pay any applicable local sales taxes. If you have questions about this story, please contact us at Editors@carfax.com. Discounts for volume sales are not taxable. You might have to pay the difference if the seller’s state sales tax is lower than your state’s. 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