How To Sell a Car in Michigan

Selling a vehicle in Michigan requires compliance with state laws governing title transfer, ownership documentation, odometer disclosure, sales tax, and registration. The Michigan Department of State, through the Secretary of State's office, administers vehicle titling and registration requirements for private-party sales and all other vehicle transactions.

What You Need To Know Before Selling a Car in Michigan

Title Law and Ownership Requirements

Under Michigan Vehicle Code Section 257.217, a certificate of title is required for most motor vehicles before a valid sale can be completed. The registered owner must possess the original certificate of title and ensure that all ownership records are current and accurate prior to transferring the vehicle to a buyer. When multiple owners are listed on the title, the legal relationship between them determines signature requirements. If the title lists owners joined by "and," all owners must sign the title assignment. If the title lists owners joined by "or," only one owner's signature is required for transfer.

Vehicles Exempt From Title Requirements

Not all motor vehicles require a Michigan certificate of title. Under state law, the following categories are exempt from titling requirements:

• Recreational vehicles such as snowmobiles and off-road vehicles not registered for on-road use
• Watercraft and boats
• Certain trailers with weight specifications below registration thresholds, though most trailers must be registered

For vehicles not subject to titling requirements, proof of ownership may be established through a bill of sale or existing registration documentation.

Satisfying an Existing Lien

If a lienholder is recorded on the vehicle's certificate of title, the lien must be fully satisfied and released before the vehicle can be transferred to a buyer. Under the Electronic Lien and Title (ELT) system, lienholders must complete an electronic transaction to release the lien when a loan is paid off. If the lienholder is not enrolled in the ELT system, the lienholder must sign off the title or provide a written lien termination letter. The seller should retain the lien release documentation together with the title before proceeding with the sale.

Documents Required To Sell a Car in Michigan

Certificate of Title

The original certificate of title is the primary ownership document and must be delivered to the buyer. The seller must complete the seller's section of the title by providing the buyer's name and address, the date of sale, an accurate odometer reading or mileage statement, and the seller's signature. The odometer reading must reflect the actual mileage displayed on the vehicle's odometer at the time of sale.

Odometer Mileage Disclosure Statement

Under Michigan Vehicle Code Section 257.233a and federal law, the seller must provide the buyer with a written odometer mileage disclosure statement at the time of transfer of ownership. The Odometer Mileage Disclosure Statement (Form BDVR-108) is the official form for this purpose. The seller must certify one of the following on the form:

• The odometer reading is the actual vehicle mileage
• The odometer reading exceeds the mechanical limits of the odometer (indicating rollover)
• The odometer reading is not the actual mileage (a discrepancy warning)

Both the seller and buyer must sign the completed statement. Failure to complete an odometer mileage disclosure statement or providing a false statement may result in civil liability, fines, and possible imprisonment under federal law.

Bill of Sale

Although Michigan law does not mandate a bill of sale for private vehicle transfers, many transactions benefit from this additional documentation. The Michigan Motor Vehicle Bill of Sale (Form TR-207) is available from the Michigan Department of State and should include the full name and address of the seller, the full name and address of the buyer, the date of sale, a complete vehicle description including the vehicle identification number (VIN), make, model, year, and body style, and both parties' signatures. Retaining a copy of the bill of sale provides documentation of the sale and protects the seller from subsequent liability claims.

How To Transfer a Car Title in Michigan

Step 1: Review the Title Before the Sale

Before conducting the sale, the seller should verify that the title is in proper order, is free from alterations or damage, and accurately reflects current ownership. The seller must check that all lienholder information is current and determine whether the lienholder participates in the Electronic Lien and Title (ELT) system. If a lien is recorded, the seller must obtain a lien termination letter or ensure the lienholder will sign off the title upon loan payoff.

Step 2: Complete the Seller's Portion of the Certificate of Title

At the time of sale, the seller must complete the assignment section on the reverse of the original certificate of title. The seller provides the buyer's full legal name and complete address, the date of sale, and an accurate odometer reading, and signs the title exactly as the name appears on the face of the document. All co-owners must sign if ownership is listed with "and." Only one owner must sign if ownership is listed with "or."

Step 3: Provide the Odometer Mileage Disclosure Statement

The seller must complete the Odometer Mileage Disclosure Statement (Form BDVR-108) at the time of sale, certifying the actual mileage displayed on the vehicle's odometer. Both parties must sign and date the statement before the vehicle is delivered to the buyer.

Step 4: Deliver Required Documents to the Buyer

At the time of sale, the seller delivers the following documents to the buyer:

• The original certificate of title, properly completed and signed by all owners
• The completed Odometer Mileage Disclosure Statement (Form BDVR-108), signed by both parties
• A copy of the bill of sale if one was executed

The seller should retain copies of all documents for personal records and for potential future reference in liability matters.

Step 5: Buyer Applies for Title Transfer Within the Deadline

The buyer must apply to transfer the title into their name within 15 days from the date of sale. The buyer may transfer the title online through the Michigan Department of State online title transfer service, in person at a Secretary of State office, or through self-service stations located throughout the state. At the time of application, the buyer must pay all applicable fees to complete the transfer application.

Title Transfer Fee Schedule in Michigan

In addition to the state title fee, the buyer may incur registration fees based on the vehicle's age and manufacturer's suggested retail price (MSRP), and plate fees if a new plate is needed. If the buyer transfers an existing plate to the new vehicle, a plate transfer fee of $10 to $15 applies, depending on the plate type and whether the vehicle was purchased privately or from a dealer.

Sales Tax on Private Vehicle Sales

Michigan imposes a 6% sales tax on the gross purchase price of private vehicle sales. This tax applies to all motor vehicle transfers between private parties and is applied at the time of title transfer and registration. The buyer is responsible for paying the 6% sales tax unless a statutory exemption applies. An exemption from sales tax is available when the vehicle is transferred to an immediate family member, including a spouse, parent, natural or adopted child, sibling, grandparent, grandchild, in-law relative, stepparent, stepchild, stepsibling, or legal ward under a court-ordered guardianship. Under Michigan law, no sales tax is assessed on transfers between qualifying family members.

What To Do After Selling Your Car in Michigan

Remove and Dispose of the License Plate

Under Michigan Vehicle Code Section 257.233, the seller must remove the license plate from the vehicle before the buyer takes possession. The license plate belongs to the owner and does not transfer with the vehicle. Exception: The seller may leave the plate on the vehicle if the transfer is made to an immediate family member. The seller may dispose of the old license plate by rendering it unusable through cutting, bending, or otherwise destroying it. The seller may also contact a local recycler if the plate can be recycled locally. The plate must be completely destroyed to prevent fraudulent reuse.

Maintain Records of the Sale

The seller should retain a copy of the certificate of title assignment, the odometer disclosure statement, and any bill of sale for at least 18 months. Under Michigan law, a seller who maintains proof of sale is not liable for any damages or for a violation of law if the title is not subsequently transferred to the buyer.

Cancel Insurance Coverage

After the sale is finalized and the license plate is removed, the seller should promptly notify the insurance provider to cancel coverage for the sold vehicle or to transfer the policy to a replacement vehicle. Maintaining insurance on a vehicle no longer owned is not required and may result in unnecessary premium charges.

Contact Information

Michigan Department of State
430 W. Allegan St., Richard H. Austin Building, Lansing, MI 48918
Phone: (888) 767-6424
Official Website: Michigan Secretary of State