All vehicles must be titled to show ownership in the state of Maryland. However, when a car changes ownership, the title also needs to change hands. It also needs to change names – it has to be transferred from the previous owner’s name to the name of the new owner. This happens when a car is bought or sold, as well as when one is inherited, or gifted. There are several important things that you should know about how to transfer a car title in Maryland, though.
For buyers, it’s crucial to follow some specific steps in the title transfer process. These include the following:
- On the back of the title, you and the seller must both complete the Assignment of Ownership fields.
- The odometer reading must be recorded on the back of the title. If there is not enough space, then an Odometer Disclosure Statement must be used.
- You need a bill of sale from the seller. In addition, it will need to be notarized under certain conditions. For instance, if the car is less than 8 years old, the sale price is $500 or more less than its value, or you want to base the sales tax on the sale price rather than the car’s value, the bill of sale must be notarized.
- Complete the Notice of Security Interest Filing to prove that all liens have been removed.
- Complete the Application for Certificate of Title.
- Get insurance on the car and show proof of coverage.
- Get a certificate of inspection from a state-approved inspection center.
- Have the vehicle’s emissions inspected and obtain proof of passing the Vehicle Emissions Inspection Program Test.
- Bring all the required documents to the MVA office, and pay the title transfer fee ($100) and the sales tax (maximum 6% of the sale price).
- Not getting a lien release from the seller
There are several steps that sellers will need to complete in order to transfer a car title in Maryland. They are as follows:
- Complete the back of the title with the buyer. Make sure that all fields are filled out. If there isn’t room for the odometer reading, provide an Odometer Disclosure Statement.
- Complete the Notice of Security Filing for the buyer to prove there are no liens.
- Remove the license plates. These do not go to the buyer. You can either use the plates on another car, or you can turn them in to the MVA.
- Not completing all the fields on the back of the title
- Not providing the buyer with a lien release
Gifting and inheriting vehicles
Maryland allows vehicles to be gifted, and if gifted to a family member, there is no tax payable. However, the recipient will need to pay the title transfer fee, and the process is the same as outlined above. The process of transferring a title on an inherited vehicle is complex, so Maryland has created a detailed website dedicated solely to that topic.
For more information about how to transfer a car title in Maryland, visit the state’s MVA website.
This article originally appeared on YourMechanic.com as How to Transfer a Car Title in Maryland and was authored by Valerie Johnston.