How To Sell A Car In Colorado

Dustin Hawley | Mar 05, 2021

Oftentimes, when you sell your vehicle to a car dealership, the process is relatively simple. You walk in, negotiate a price, and walk away with your money (or, in the case of a trade-in, your new vehicle). It’s a mostly hassle-free process, where the dealer handles all the paperwork, and you just have to sign on the dotted line.

how to sell a car in Colorado

On the other hand, a dealership sale will likely net you a less-than-optimal price for your used car. If you want to sell your car for more money, you’ll need to do so with a private buyer. Though it sounds relatively straightforward, the downside of a private sale is that you need to manage all the paperwork entirely on your own.

Fortunately, the process isn’t all that complicated, even in states with unique laws and requirements. If you are looking to sell your car in the state of Colorado, here’s an overview of the steps and conditions that are necessary to transfer ownership.

Ensure You Have A Clean Title

In many ways, a title is the most important document related to your automobile. It provides legal proof that you are, indeed, the owner of the vehicle. This is important because, without a clean title, the car cannot be sold or transferred.

A clean title is legible, has not been damaged or torn, and contains accurate, up-to-date information. If you no longer have a clean title, you’ll need to apply for a duplicate by completing and returning form DR 2539A, along with an $8.20 administrative fee.

Similarly, if there is a lien on your title, your loan will need to be paid in full before the car can be sold. You can do this personally, have the buyer pay on your behalf, or transact the sale through an escrow service to ensure payment.

Make Sure Your Emissions Inspection Is Up-to-Date

Cars and SUVs in several Colorado counties are required to undergo a periodic emissions inspection. These counties include Boulder, Broomfield, Denver, Douglas, and Jefferson. Additionally, residents in parts of Adams, Arapahoe, Larimer, and Weld counties also need inspections. Residents of these counties should contact their local DMV office for more details.

Sellers who reside in these areas cannot sell a vehicle without a current emissions inspection certificate. Even if you live in a county that does not require this testing but is a neighboring county to one that does, you may still want to consider getting an inspection regardless. Otherwise, you’ll be severely limiting your pool of potential buyers.

Run A Vehicle History Report

Though it is purely optional, a vehicle history report can boost the confidence of prospective buyers by letting them know you’re being fully transparent. Running a report on your own can also save time, as many buyers will want one before deciding to purchase. If you already have a vehicle history report on hand, you are one step closer to making a sale.

On a related note, many buyers may also want to have a safety inspection performed before purchasing. There is nothing wrong with this, and it’s common practice for private transactions. The buyer will typically choose their own mechanic, someone whose opinion and expertise they trust. As a result, the buyer is responsible for paying for any inspection. If they request that you pay for the inspection, you will likely find a better offer from another prospective buyer.

Place A Quality Ad

Listing your car for sale might seem like a trivial step, but it’s far from it.

Remember, the more buyers you attract, the more offers you receive, and the more options you have to negotiate.

If you’re listing your car on an online marketplace (i.e., Craigslist, Facebook), consider using more than one platform. This will ensure that you maximize your exposure to potential buyers and get as many people as possible to see your car. 

Make sure to include all the car’s vital information, including the make, model, year, and mileage of the vehicle. Don’t forget to include pictures with the ad, so interested buyers have a good idea of the car’s current condition. And don’t forget to list your contact information. This includes an email and phone number so people have a way to reach out to you regarding the car. It’s difficult to receive any offers if buyers don’t have a way to get in touch with you!

Fill Out The Title, Odometer Statement, And Bill Of Sale

Once you have filtered through offers, found a buyer, and agreed on a price, you’ll be ready to complete the sale. 

Start by having both parties fill out the buyer and seller sections of the title, respectively. Make sure to print and sign your full names accurately, as this is a legal document that requires complete accuracy to be deemed valid. At this time, you will also want to ensure that the listed odometer reading is correct.

The State of Colorado also requires that cars sold in a private sale must include a separate odometer statement. This statement is not available for free but can be purchased from several online locations for a nominal fee.

Finally, a bill of sale must be completed and signed by both parties. It must include the following information. 

  • The legal first and last names of both the buyer and seller
  • The vehicle’s VIN
  • The sale price
  • The date of the sale

Print off two copies and fill them both out: one for the buyer, one for the seller.

As a final step in completing the transaction, remember to remove the license plates from the car. These stay with the seller and not with the vehicle. If you’re buying a new car, you can simply transfer these tags over, or if you’re not replacing your old car, you’ll need to turn your plates in to the DMV.

Report the Sale

Now that the transaction is complete, the last thing to do is report the sale of your vehicle. While this is totally optional in the state of Colorado, it can help to shield a seller from liability if there is an incident involving the new issue of ownership. Essentially, it lets the state know that you are no longer responsible for your old car.

If you choose to report your sale, you must do so within five days of the transaction. There are two options to do this; either online or at your local DMV office.

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