To sell a vehicle in Massachusetts, sellers must follow the specific laws and regulations set by the Massachusetts Registry of Motor Vehicles (RMV). One example is the Massachusetts General Laws (MGL) Chapter 90, Section 2, which outlines the requirements for the transfer of ownership of a motor vehicle, including the need for a properly executed certificate of title.
Sellers are responsible for providing the buyer with a signed vehicle title and accurately disclosing the odometer reading. Sellers may be required to complete a bill of sale, which documents the transaction details. Failure to adhere to these requirements can result in legal consequences.
Moreover, Massachusetts has implemented a law that grants buyers the right to void the sale within seven days if the vehicle fails inspection and the necessary repairs exceed 10% of the purchase price. In such instances, the seller must accept the vehicle's return and refund the buyer.
Legal Requirements Before Selling a Vehicle in Massachusetts
Before selling a vehicle in Massachusetts, there are specific legal requirements and documents that both the seller and buyer must complete to transfer ownership properly. These steps and legal requirements include the following:
Duplicating a Title
A certificate of title is necessary before selling a vehicle in Massachusetts. The title is a legal document that proves ownership of the vehicle. Without a valid title, the seller cannot legally sell the car, and the buyer cannot register it in their name.
If the original title is lost, stolen, mutilated, or destroyed, the vehicle's owner can apply for a duplicate title. They can request a duplicate from the Massachusetts RMV by completing an Application for Duplicate Certificate of Title or Form T20558. The requester must include their vehicle identification number (VIN), driver's license number, and current odometer reading.
After completing the application, the individual can submit it online, by mail, or in person at their local MA RMV office. If they choose to apply by mail, they should send the filled-out application and a $25 fee, which can be paid by check or money order, to any MA RMV Center.
Pre-Sale Inspection
A pre-sale inspection can help identify potential issues with the vehicle. Lemon laws require private sellers to disclose to prospective buyers any known defects that could affect the vehicle's safety.
If a pre-owned vehicle does not pass a state safety inspection within the first week, the buyer can get their money back from the seller.
If the buyer finds a defect within 30 days and proves that the seller was aware but did not disclose it, they are eligible for a full refund.
Under the Lemon Laws, a person may be eligible for compensation if their used vehicle has at least one qualifying defect that impairs its use or safety.
Proof of Visual Inspection
Proof of Visual Inspection is a legal requirement to have a valid inspection sticker before registering.
A state-specific Proof of Visual Inspection must be assigned to sell a vehicle in Massachusetts. This documentation should be provided to the buyer before the sale process. The seller should disclose to the potential buyer that the vehicle has a Massachusetts-assigned VIN.
Both parties should make sure that the Massachusetts-assigned VIN is correctly affixed to the vehicle and that all relevant documentation, such as the vehicle's title and registration, accurately reflects the assigned VIN.
Vehicle History Report
In Massachusetts, obtaining a vehicle history report is crucial when selling a vehicle. This report provides potential buyers valuable information about the car's past, including previous owners, title applications, and supporting documents. It reassures buyers about the vehicle's background, potentially speeding up the sale and increasing buyer confidence.
To trace the history of a vehicle, the seller can request a copy of the RMV computer record of previous owners or photocopies of the actual title application and supporting documents.
For vehicle owners or license/ID holders, the process involves submitting a completed History Search Request or Photocopy form, a photocopy of their state-issued ID or license, and paying the applicable fees.
Authorized recipients or DPPA (Driver's Privacy Protection Act) permitted users must submit a completed Request for Personal Information application, a photocopy of their state-issued ID or license, and the necessary fees.
The MA RMV will mail the requested documents within 7-10 business days after receiving the request.
Advertising the Vehicle
Massachusetts, like most states, has laws against deceptive or unfair practices in all consumer transactions, including private sales.
When a private seller advertises a vehicle, they should follow these basic guidelines:
- Be truthful: Don't make false claims about the vehicle's condition, history, or features.
- Disclose known issues: If aware of any problems with the car, it's best to disclose them upfront.
- Clear pricing: State the price clearly and what it includes or doesn't.
- Accurate description: Provide a precise vehicle description, including make, model, year, and mileage.
Private sellers are not bound by the same strict regulations as dealers outlined in 940 Mass. Reg. 5.02. However, maintaining honesty and transparency in advertisements can help avoid legal complications and establish trust with prospective buyers.
Selling a Vehicle with a Lien in Massachusetts
In Massachusetts, specific regulations must be followed when selling a vehicle with a lien. These regulations are outlined in MGL Chapter 90, Section 24.
If a private seller or owner possesses the vehicle's title with a lien, they must release their claim within three days. This can be done by signing the title directly or using a form the registrar provided. If a lienholder's debt has been fully paid off, they must sign a release form provided by the registrar to remove their vehicle claim officially.
This law makes sure that private sellers or owners promptly release their legal claim on a vehicle's title once the debt has been satisfied, thereby making the process more transparent and straightforward for all parties involved.
Obtaining a Lien Release
To remove a lien from a car title in Massachusetts, contact the lienholder to obtain a signed letter confirming the loan has been paid off. The letter should include the vehicle's details, such as the year, made, VIN, and the names of all titled owners.
Submit the original lien release letter and the application for a replacement title. If the titled owner has passed away, additional documentation such as a letter of administration, court order, affidavit of surviving spouse, and a death certificate must be included.
The Massachusetts RMV participates in an Electronic Lien and Title program, which allows the RMV to transmit an electronic record of the Certificate of Title to participating lienholders instead of printing and mailing a paper title.
The title remains in electronic form until the loan is satisfied. If the loan is paid off directly by the vehicle owner, the lienholder will notify the RMV to release the lien and mail the title to the owner. If a dealer pays off the loan, the lienholder may designate the title to be sent directly to the dealer.
Motor Vehicle Sales Tax in Massachusetts
The sales or use tax on motor vehicles and trailers is generally imposed at a rate of 6.25%. The tax is required for the purchase, use, storage, or any form of consumption of a motor vehicle or trailer within the state.
The sales tax is applicable to title or possession transfers that occur through retail sales conducted by registered dealers or lessors in the course of their business activities.
A use tax must be paid by the 20th day of the month following the entry of a motor vehicle or trailer into Massachusetts if it was purchased outside the state and brought in for permanent use within six months.
Any buyer who is not required to register or title the vehicle in Massachusetts must submit a completed Motor Vehicle Certificate of Payment of Sales or Use Tax, or Form ST-7R following the purchase, transfer, or use of the vehicle and pay any applicable tax to the Department of Revenue or the RMV.
Who Pays Sales Tax When Selling a Car Privately in Massachusetts?
The purchaser is responsible for paying the sales tax. When a Massachusetts vehicle is sold to a resident of another state, the sales tax treatment depends on the circumstances of the sale and the laws of the state where the purchaser resides.
If a Massachusetts dealer sells the vehicle and delivers it to an out-of-state buyer, the dealer must collect the Massachusetts sales tax unless the buyer presents a valid resale or other exemption certificate.
If the vehicle is sold through a casual sale and the seller delivers it to the out-of-state buyer in their home state, the sale is generally not subject to Massachusetts sales tax. The purchaser may be responsible for paying sales or use tax in their home state.
However, any taxable vehicle brought into the state within six months of purchase for use in Massachusetts is generally subject to the use tax.
Legal Requirements After Selling a Vehicle in Massachusetts
During or after a vehicle sale in Massachusetts, a seller must adhere to the state's legal requirements. These requirements are designed to protect the interests of both parties after a vehicle sale and minimize the risk of legal disputes.
Odometer Disclosure Requirements
The Federal Odometer Act requires that the seller of a motor vehicle provide the purchaser with a written disclosure of the vehicle's mileage registered on the odometer at the time of sale. This disclosure is usually on the back of the title, which both parties must complete. In cases where there's no space on the title, a separate Odometer Disclosure Statement is necessary.
However, certain vehicles are exempt from this odometer disclosure requirement in Massachusetts, including all vehicles model year 2010 or older, vehicles over 16,000 lbs., non-motorized vehicles (such as trailers), low-speed vehicles (LSVs), and mopeds or scooters.
The disclosure must include the following information:
- The odometer reading at the time of transfer
- The date of transfer
- The seller's name and current address
- The buyer's name and current address
- The vehicle make, model, year, body type, and VIN
Odometer Fraud
Odometer fraud is a criminal offense under state and federal law in Massachusetts, as mandated in MGL Chapter 266, Section 141. This law is designed to protect purchasers from purchasing defective vehicles.
Under this law, if a seller is found to have tampered with or misrepresented the odometer reading, the buyer may be entitled to a refund or replacement of the vehicle. Buyers should be vigilant when purchasing a used car in Massachusetts to avoid falling victim to odometer fraud.
These are some signs that a vehicle's odometer may have been tampered with include:
- The odometer reading is inconsistent with the vehicle's age, appearance, or condition.
- The numbers on the odometer are misaligned or have unusual spacing.
- The vehicle has a history of frequent ownership changes or title transfers from different states.
Odometer fraud is a criminal offense in Massachusetts and can result in fines and imprisonment. If a buyer can provide evidence that the seller illegally rolled back or reset the odometer on the vehicle, the purchaser can take legal action and sue for $1,500.
Transferring the Title to the New Owner
Transferring the title to a new owner after selling a vehicle involves filling out the necessary information on the title document and providing it to the buyer at the time of sale. Locate the "Assignment of Title" section on the back of the Certificate of Title, and fill in the following information:
- Buyer's name and address
- Odometer reading at the time of sale
- Date of sale
- Purchase price
The seller must sign and print their name in the designated spaces on the title. If there's a need to correct the odometer reading on the title, a Notarized Affidavit for Correction is required.
If ownership changes or an owner is added or removed from the title, this is considered a transfer of ownership, and a new original title must be applied.
If a dealership sells the vehicle, they may have additional forms and procedures for transferring the title. If any information on the title needs to be corrected or amended, the following items are required:
- The original Certificate of Title
- A completed Title Amendment Form, with all owners signing the application
- Any other documentation relevant to the correction
- Payment of the $25 Title Amendment Fee
Removing the Plates
After a vehicle sale in Massachusetts, the seller must remove the license plates from the vehicle before handing it over to the buyer. The plates belong to the seller, not the car, so they should be kept by the seller.
If the seller does not plan to transfer the plates, they must return them to the RMV in person at any MA RMV Service Center or by mail. In case of lost or stolen plates, the seller must report it to the RMV and obtain new plates with a new number, as they cannot order replacement plates with the same number.
If one plate is damaged but not lost, the seller can order a replacement plate online with the same plate number, which will be mailed to their address on record within 12 weeks. The fee for replacing a license plate is $10 per plate.
How To Notify the Massachusetts RMV of the Sold Car?
The seller must notify the Massachusetts RMV of the change in ownership after selling a car in Massachusetts. This process helps protect the seller from any future liabilities associated with the vehicle.
It is highly recommended that the seller have a copy of the bill of sale, as it is an official record of the transaction between the buyer and the seller. The bill of sale should include essential information about the vehicle, such as the make, model, year, VIN, and sale price. It should also contain the names and addresses of both the buyer and the seller and the date of the sale.
The original form can be mailed to the RMV at the following address or submitted through the RMV Service Center:
Registry of Motor Vehicles
P.O. Box 55889
Boston, MA 02205-5889