Comprehensive Guide to Buying a Used Car in Tennessee
1. Determine Your Budget
Before purchasing a used car, it's essential to set a budget. Consider all costs such as insurance, registration, and taxes, as well as maintenance costs.
Helpful link: Tennessee Car Tax Calculator
2. Research the Vehicle
Look up reliable models and compare prices using online resources like Kelley Blue Book or Edmunds. Check reviews, reliability ratings, and the average cost of ownership.
3. Check Vehicle History
Before purchasing, request the vehicle’s history report to ensure there are no hidden issues like accidents, title problems, or odometer discrepancies.
4. Inspect and Test Drive
Always inspect the car in person and take it for a test drive. Check for any signs of wear, damage, or mechanical issues. Consider hiring a professional mechanic for a thorough inspection.
5. Verify Title and Registration
Make sure the seller provides a clear title, without any liens. If buying from a private seller, ensure that the vehicle’s registration matches the title.
Tennessee Department of Revenue - Title Information
6. Negotiate the Price
Use the information you've gathered to negotiate a fair price. Don’t be afraid to ask for a lower price, especially if you’ve identified any minor issues with the car.
7. Complete the Bill of Sale
In Tennessee, both the buyer and seller must complete and sign a Bill of Sale. This document proves that ownership has been transferred and is required for registration.
Tennessee Bill of Sale Template
8. Pay Sales Tax
Tennessee requires the payment of sales tax when buying a used car. The current tax rate is 7%, with local tax rates possibly adding more.
Tennessee Vehicle Sales Tax Information
9. Obtain Insurance
Before driving the car, make sure to get the appropriate insurance coverage, as it is required by law in Tennessee. You will need proof of insurance to complete the registration process.
Tennessee Auto Insurance Requirements
10. Register the Vehicle
Within 30 days of purchase, you must register the vehicle with the Tennessee Department of Revenue. You'll need the signed title, Bill of Sale, proof of insurance, and proof of identification.
Tennessee Vehicle Registration Information
11. Obtain License Plates
After registering the vehicle, you will receive your license plates. Be sure to keep your registration up to date to avoid penalties.
Tennessee License Plate Information
12. Get a Vehicle Emissions Test (if required)
Depending on where you live in Tennessee, you may need to get a vehicle emissions test before registering the vehicle.
Tennessee Emissions Testing Locations
Fees for Buying a Used Car in Tennessee
1. Sales Tax
Tennessee charges a state sales tax of 7% on the purchase price of the vehicle. Some counties and municipalities may also levy additional local taxes, so the total sales tax can vary depending on where you live.
2. Title Fee
The fee for transferring the title to the buyer’s name is $11. This is a mandatory fee when purchasing a used car in Tennessee.
3. Registration Fee
The standard registration fee for passenger vehicles in Tennessee is $26.50. However, additional fees may apply for specialty or personalized plates.
4. County Wheel Tax
Some counties in Tennessee charge a county wheel tax that ranges from $10 to $100, depending on the county.
5. Emissions Testing Fee (if required)
In certain Tennessee counties, vehicles are required to pass an emissions test, which typically costs around $9. However, this fee may vary by county.
6. Dealer Fees (if applicable)
If purchasing from a dealer, additional fees like documentation fees, which can range from $100 to $500, may be charged. Be sure to confirm these fees with the dealer in advance.
7. Optional Vehicle Inspection Fee
If you choose to have the car inspected by a mechanic before purchase, this fee will vary depending on the mechanic but typically ranges from $100 to $200.
FAQ on Buying a Used Car in Tennessee
1. What kind of insurance does my used car need?
In Tennessee, drivers are required to have liability insurance to cover damages in the event of an accident. The minimum liability coverage required includes:
- $25,000 for injury or death of one person in an accident
- $50,000 for injury or death of two or more people
- $15,000 for property damage
It’s recommended to consider additional coverage such as comprehensive and collision insurance for extra protection, especially for newer used vehicles.
Tennessee Auto Insurance Requirements
2. How do I protect myself when buying a used car privately?
To protect yourself when buying a used car privately, follow these steps:
- Get a vehicle history report: Use services like Carfax or AutoCheck to ensure the car hasn’t been in any major accidents or has a salvage title.
- Have the car inspected: Hire a trusted mechanic to inspect the car before purchase.
- Meet in a safe location: Always meet in a public place and never alone. You can also use a police station parking lot for extra security.
- Check the title: Ensure the seller provides a clear title with no liens against it.
Carfax Vehicle History
Tennessee Department of Revenue - Title Information
3. Is buying a car privately with cash a good idea?
Buying a car privately with cash can be a good idea, as it allows for more straightforward transactions and can help you negotiate a better price. However, you should take precautions:
- Get a Bill of Sale: Ensure both you and the seller complete and sign a Bill of Sale, detailing the transaction.
- Verify ownership: Make sure the title is clear and matches the seller’s information.
- Meet in a secure location: If exchanging large sums of cash, consider doing so at a bank for added safety.
Tennessee Bill of Sale Template
4. What are temporary tags?
Temporary tags are issued when you purchase a vehicle and need to drive it before the permanent registration process is completed. These tags allow you to legally operate the vehicle while waiting for your title and registration to be processed.
In Tennessee, temporary tags are valid for 30 days.
Tennessee Temporary Tags Information
