Or what is needed to buy a car as a foreigner in the USA: the steps to take before you can drive your own car.
1.Ask yourself: do I really need it?
We bought a car after realizing that hitchhiking is not very popular, and you could pass as a homeless rather than a hitchhiker. Second option, renting a car, was really nice. For about $1400 we could have had a car for a couple of months, at least according to the online quotes. All looked fine until we contacted several companies to get quotes and try to actually book a car. That’s when the problems started:
-you can’t rent a car without a credit card (not debit card) – we don’t have one!
-but wait, they say you can with a debit card and credit check! of course, but only if you live in the USA (own a US driver’s license)
-well, let’s try to use someone else’s credit card: not possible – it has to be in driver’s name.
Conclusion: the renting companies (like Enterprise, Dollar, Hertz, Sixt, etc.) would rent only with credit card. This is when we got our answer to the question: yes, we need to buy one!
2. Read online about the potential problems YOU might have
Is your driver’s license valid? Can you drive? Can you get insurance? After reading several online articles from people who did it, we realized that the main problem for us might be the insurance. The insurance companies require you to have a US address, or US driver’s license, or, the problem that we had in all cases: wouldn’t make an insurance policy for less than 6 months or a whole year. Several calls or emails exchanged with various insurance companies just validated our concern.
How we went around this: the big insurance companies you find online don’t bother with small policies, so you shouldn’t bother either. Most states only require liability insurance at minimum, and you can easily get this from a small insurance company on the street.
We went from one office to another trying to find one company to suit our needs: cheap, short term (2months), foreign driver’s license, no questions about the address in US. Found several companies who could help us: some with a down payment of about $100 and then about 50$ per month ($250 for 2 months), others with a monthly fee of about $140 per month and no down payment ($280/2 months), and the one we went with: AALL – $71 per month and no down payment. So we have our insurance for 2 months with only $142 – and a very pleasant customer service in a more distant suburb of Phoenix, AZ.
Attention, though! The insurance is more costly the newer the vehicle is. The prices also vary with the type of vehicle (SUV/sedan/truck/etc.)
3. Budget
Car dealers sell used cars starting with as low as $1500 but usually from $2200 up. For this money they give you a car worth about $1000 and take care of the paperwork for you (and probably give you some warranty too).
We chose to go lower than that, so kept an eye on Craiglist. Most cars selling for $500 are damaged and need to be towed, and they go the same way until about $1200, where you might find a working one. We found ours for $1000 advertised as: “good engine, clear title, drives and works fine with minor things not working”. I called about 10 people for more details but most of the cars had hidden caveats we couldn’t pass – most overheating, or leaking oil, or broken transmission. Worth spent money on the phone calls. I won’t give you advice about how much to spend on a car. An expensive car isn’t always one that’s reliable, or with good fuel efficiency. One thing that’s worth mentioning is that the cars in US are not very well maintained: so more often you’ll find cars running with the same oil for years, or with minor fails easy to fix.
4. Paperwork
On a strong note, before jumping to anything, read first the necessary paperwork from the source: http://www.dmv.org/
because it varies a little from state to state. I will further describe the process for Arizona.
What the DMV site says you need for a car:
-The bill of sale.
-The completed vehicle title.
-The Title and Registration Application (Form 96-0236).
-Lien release documents, if applicable.
-A level I inspection IF the vehicle registration is missing.
-Payment for the fees and taxes:
-Title fee: $4
-Registration fee: $8.
-Air-quality research fee: $1.50.
-Vehicle license tax (VLT): Based on purchase price.
Later edit:
We learnt a bit more after selling the car in California. This state is unlike no other, so when you buy a car there, it needs to come with a smog certificate unless the car is no more than 4 years old (it’s the responsibility of the previous owner, and costs about $60) and an official odometer reading if the vehicle is less than 10 years old – read more on the DMV site for California) There are other exceptions too.
What you really need, assuming the title is clean, and the seller comes with you to a DMV office:
– ID (and possibly driver’s license)
– money to pay the taxes (for a car worth $1000, I paid a total of $59 for all taxes and new license plates).
And at this point you get your new license plates and need only the car insurance to be allowed to drive. You might find a car insurance office right by the DMV desk, but if not, a common practice is to arrange a contract with the insurance company you want and as soon as you get the title, you call the person to fill up the insurance policy for the vehicle. At this point, you can drive the car even without having the insurance paper in your hand.
So far, we paid for the car, taxes and everything extra a little less than $1400. Renting a compact or economic car for a month from Enterprise @Phoenix airport costs $1430. With a bit of care, this car we bought will drive us more than two months and we’ll still have it.
IMPORTANT tips:
1.make sure that the emission sticker on the vehicle license plate covers at least the period you want to drive the car, or else you’ll have to take the car to the inspection and pay some more money (and it may fail, especially if it’s an older vehicle).
2.if the insurance company asks about your address in USA, just give them a random (but verified to be valid) address. You can say you live with your friends there if they ask questions. If they ask for a proof for that address, find another company – they don’t want you.
3.it’s hard to find all the problems with a car from one short drive, especially if you don’t know what to look for. Basic rule: if the “Check engine soon”/”Service soon” light is on, don’t buy the car, whatever the owner says about it. If it’s an easy fix, he would have done it. If not, you’ll either drive the car to its death, or be stuck with it, unable to resell it.
4.things to check on a used car are all over the internet, make sure you know what to look for. But if you know what car you’re buying, check online for common problems of that car before going to test it. Look for factory recall issues too – it may fail again.
5.expect to put some more money into the used car you just bought. The more you drive the more you discover things that fail (we changed the tires with a better used set, added brake fluid, power steering fluid, replaced some fuses, bought some cleaning products, fixed a cracked windshield tank, and probably soon we’ll replace some pricey electronics)
Thanks for the information about buying a car in the USA.
We travelled the states extensively on vacations. Always renting a car.
But now we are thinking about living in the Washington DC area for a year, so we will definitely be needing a car in that period.
Happy travels…
Regards Bert
Happy I could help. Good luck finding a good car!
We are planning a 126 day trip to US in March 16. Your post contains a lot of good information. The only thing that I felt was misleading was the fake address. As we all know, insurance companies will try all they can to get out of paying….. So a false address would be a result for them and potentially a load of pain for you. We are buying an RV from a dealer that we have used before (we bought our 5th wheeler from him and were very happy) he has dealt with many visitors over the years and he is acting as our address in US for both the Visa and Registration of vehicle. Having someone in the industry has been gold, and we will be using our Australian licence and International Driving Permit…. Our insurance is specifically for foreign drivers and is $1200 For the year and includes breakdown/ recovery for the RV…..So hopefully we’ll have all bases covered. Good luck with your visit…. I hope all goes without incident ?
Thanks for your input Phil. I understand your concern, but I honestly believe that the cheap insurance companies in the USA don’t even pay, no matter what happens (judging by the countless damaged cars on the roads). I am just trying to provide guidelines to be compliant with the state laws – I don’t understand why the insurance companies are the ones to ask you for an address, when the DMV doesn’t care for one.
It’s good information that you added – the RV part never crossed my mind. And buying from a dealer gives you a lot of advantages (faster paperwork, some warranty) but it definitely comes with a price.
Hi Phil, can I ask which company you purchased your insurance from? Also, did you find that you needed an International Driver’s license at all to purchase your car or to drive while living in the US?
Thanks
Hi, and thanks for your useful post !
I’m also planning a 6 months roadtrip through the US, starting next March, from South Carolina. The main problem is obviously the local address and the foreign ID: after much research, I found this solution which is entirely legal 😉
Some small local insurances accept a “care of” address. Can be a pain to find them though. So there’s this big one, specialized in non us citizen, that does it : http://www.sunriseworldwide.com/. And apparently you can pay quarterly.
The DMV also accepts “care of” addresses, but you have to fill out an additional form signed by the US resident you “live” with (at least in SC and CA apparently). Quite logical, in fact.
You can do all of this with your passport and your international license. Sure to be covered that way !
As Phil Hutchison suggested, using the address of your dealer must be very convenient ! I had thought of finding someone willing to help me with that on Couchsurfing, but I’ll try also with a dealer^^
Thank you Pierre for the very useful input! Looks like there is a ‘legal’ way to do it in terms of address.
Sunriseworldwide.com was the first company I asked for a quote and this is the reply I received:
“Hello Alexandru,
Typically our clients are stationed here for one year or more. Our program is not equipped to handle short term policies. You can certainly contact Geico, or Progressive as they should be able to assist and are set up better to handle short term policies.
Amber Freeman
Customer Service
The Sunrise Group”
Damn, thanks for the tip Alex.
That’s strange though, they answered me positively, and I did mentioned the 6 months trip duration :
“Yes you can use a care of address of where you will initially start your trip for the garaging address(your friends local address)”
And as you must know, Geico isn’t possible. At least that’s what they told me.
Anyway, fortunately I found this other company (http://www.sadlerandhamm.com). Here’s their answer :
“I would need a local address
first/last names
DOBs”
Ahah, quite simple and direct !
(Seriously, after a while you just wanna tell them to shut up and take the money…)
Piere…. you mind messaging me?? we can share notes 🙂 phutchison@les.net.au
Hi, I wrote a similar blog post.. Here is the link:
http://www.road-trip-usa.com/blog/things-to-consider-when-buying-a-vehicle-in-the-usa
We too decided to buy a van somewhat similar to yours originally (Ford Windstar) however it ended up having issues 6 months into our trip and had to buy another. It wasn’t that difficult purchasing a vehicle in regards to paperwork. Just needed an address for title/registration to be sent to. But the insurance has been quite frustrating. We have found Geico are the only ones who will insure those with foreign license’s, and even then they do actually state that you must get a U.S license within 6 months so not sure technically if anything were to happen if they would compensate.. (but hey at least we have a vehicle on the road). The other quite annoying thing is the cost of insurance changes with each state. Surprisingly California is ALOT cheaper than Oregon. Our original van was bought in Cali and ended up purchasing a new van in Oregon. As a traveler it is frustrating because you aren’t in any state for long. But you can only be insured in the state the vehicle was bought (unless you want to pay fees to have plates changed over which again you will need an address in that state).
Definitely worth buying a vehicle over renting but make sure you have extra funds when things go wrong.
Thanks Arial. The cost of insurance is indeed changing according to each state. NC and AZ are among the cheapest. Sorry to hear you had trouble with your car, but… hey – that’s the adventure 😀 You’re also right about the driving license. Some countries have privileges, but as a general rule, you’re only allowed to drive for 3 months in a foreign country with your home drivers license. BTW, Mexico doesn’t really recognize the foreign driver license, even if they could. Safe travels! Meet you guys somewhere!
Hi guys, thanks so much for this blogpost, really informative. We are planning a roadtrip through US and we would like to purchase an old VW camper van in the US to go along with. We are trying to figure out our possibilities of buying a car in the US as a foreigner. What I understand form all the information is that registration and insurance can be difficult because of the required US address and/or foreign driver license. We are searching the south western states for a VW van, but at this moment we don’t know yet if we will find the right VW van in California, Arizona or Nevada. So how to deal with this whole registration and insurance process in this case? Can you choose the state yourself that is easiest for registration? for example, is it possible to register a car in Arizona while the seller registrated the car in California because registration for foreigners is easier in this state ? or do you have to register in the state where you are buying the car? Can i ask already insurance companies for quotes while we don’t know yet in which state we will buy/register the car? We would like to check already if we can get insurance before we go into buying a car obviously! For example, can I already contact AALL to inform if they would like to insure us (short term (max 6 months), Dutch driver licence, no US address) without knowing yet where the actual purchase will take place (the car type we already know more or less) ? If not, how to deal with this? and if I understand it correctly, registration in Arizona didn’t require US driver licence and US address? Does anybody knows this for California or Nevada? Hope you can help us out!
Inge, thanks for reading my post. You have a lot of questions and I don’t have many answers for you. I can certainly tell you that it’s hard to find a decent working VW campervan in USA, unless you pay premium (it’s a collector’s car). There are some older Dodge, GMC, and other US cars available and with better service. VW is so rare that I doubt you’ll find parts in stock if something fails. In my whole trip I saw only 2 VW T5s, both with license plates from DE. Also, once you buy the car, the previous owner keeps the old license plates, so you need to get temporary ones. You can do that online as well (not sure about what is required, or if it’s possible in all states), and you can print them. That is enough to take you to another state if you want to register the car elsewhere. About asking insurance companies for quotes in advance, I’ve had very bad experience, at least online. But yes, once there, walk around and ask for insurance in all the insurance offices you find. They were kind enough to recommend you other insurance companies and sometimes even call them to make sure. I definitely could buy insurance, so can you! you might have to ask more, but sure will get one.
Have an awesome road-trip, wherever the road takes you. Spend more time in AZ and UT, then CA and maybe CO. These are the probably the best states!
Hi Alex, thanks for your answers. Finding a decent VW van will not be a huge problem. We have some contacts in this business 🙂 will bring spare parts and have saved money for this purchase since we would like to export the van to our home country after the road trip. But thanks for your concerns. So I guess we will find an insurance somehow but maybe it will cost a lot in the end… and did I understand it correctly that registration in Arizona didn’t require US driver licence and US address? That will be already good to know. I will contact the DMV of the other states to find out their policies. Hopefully it will all work out eventually!
Hi Inge,
I got 90 days temporary plates from the AZ DMV, with an address from Colorado though.
You don’t need a US driving licence, but you really must have a US address to do anything official.
At the time, we used a Colorado address from family friends I had never seen.
You can try to ask the garage that’s gonna sell you the van to “lend” you its address (or the seller).
Also, we registered our van in Alaska (real plates this time) with a… Walmart address. The girl at the DMV told us to do so ! But Alaska has a quite “open” car policy…
We used Progressive as insurance. They were okay with our non-US licences, but we had to give them a US address, again.
Hi Pierre,
Thanks for your reply, very useful to know! So a US address is important. a Walmart address…haha cool. We probably can manage a care of address from friends (in CA), if the authorities won’t have prove whether or not we are actually living there this part about US address can be solved.
Did you contact Progressive online in advance? And did you drive with your 90 days temporary plates to Alaska and re-register there? No problems crossing the Canadian border?
thank you all so much for your advice!
Hey Inge,
From our experience, no one asked us to prove whether we lived at the local address or not. Once in Alaska, I gave the Walmart address to the insurance guy, no problem at all! Really astonishing…^^
I learnt that EVERYTHING’s easier face-to-face with these DMV/insurance guys. While they often wrote me negative answers by email (“no, I can’t assure you without a US licence”), everything went very smoothly by phone or face-to-face. In fact, don’t make things look too complicated, that’s what makes them reluctant.
Actually, we first came across an insurance guy (small company) who couldn’t insure us, but made the call to Progressive and got us our car insurance. Very nice guy…
My opinion would be to call them once you have your local address and VIN number. Everything should be fine – also, they liked the fact that I had an international driving licence, even with my Swiss licence (seems to be reassuring to them, and to the cops).
To answer your question : yeah we drove from Flagstaff to Anchorage with an AZ temporary plate ahah. No problem at all at the borders. We’ve been stopped twice in Calgari and Vancouver though : the first cop threatened to tow the van, because our insurance wouldn’t cover us in this situation (so he said)… while the second said no problem – just wanted to know what was that “paper plate”^^ Actually, this seems to be a very “grey” zone, cops don’t really know what to do when you explain the whole situation.
Hi Pierre,
Thanks for your comment! I guess we’ll just give it a try and see what happens 🙂 at least it reassures us to read that others went to this process smoothly, so thanks for sharing!
Inge
Hi, Inge,
Did you already buy, register and insure the car?
You are Belgian, right? If that’s the case, would you mind emailing further in Dutch with me? (minne.warmenbol@gmail.com)
We are planning to travel from East to west en South to North in six months next year… This week I’ve been told that the regulations for foreigners has become more difficult since december 2016…
thanks!
Hi Alex 🙂
About the credit card problem…a word of advice. You don’t have to mention what kind of card you have. They cannot check if it is debit or credit so if you have enough money on it there is no problem. We rented a car in Germany from Sixt with a debit card 😉
Thanks. Quite useful 😉
Hi,
Thank you very much Alex and other contributors for the useful information!!
I’m moving to Utah next August for about 6 months to complete my studies. I had the idea of starting my trip on the East coast and driving through the country in summer, so buying a car/van would be optimal for me.
I’m not sure about it yet, but I guess I will have a physical address even before landing there (college’s dorm address), so in theory I shouldn’t have any big problem about that.
The only issue I see now is what it was mention by Arial about the car can only be insured in the state it was bought… so I guess It might problematic if I get the car in Maine or Massachusetts and then use it for most of my stay in Utah…. I don’t know.. what do you think?
Is there any other important point I’m missing? I’m over 25, have a credit and International Driver Licence.
Thanks!
Adrian
Thanks Adrian! I wish I can give you a definite answer about your situation. I can only tell you that the insurance is more about the driver than the car itself. I believe that it is possible to buy it in ME/MA and insure it there, with your address in another state, but don’t take my word for it. You might also be able to insure it in UT, using some online tool, and have them mail you the insurance – however, make sure you get in touch with someone beforehand, so you can drive the car already insured once you buy it. Good luck on your trip!
Hi guys,
Thanks for a great blog and post – really informative! My wife and I are planning a road trip starting in Vancouver and ending in California/New Mexico and were wondering whether it is possible to sell a Canadian car in the US.
Have heard some conflicting advice with some saying it is impossible without officially “importing” the car and getting US plates and others saying it is possible as long as you have the full title, deeds, owners manual etc.
We would be open to selling on Craigslist, private sale or to a dealership – ideally we would sell the car to people looking to do a similar road trip back to Canada.
Can anyone advise whether this is possible? Alternative would be a very long trip back to Vancouver to sell it there but would rather avoid this if possible!
Thanks,
Will
Wish I can give you an answer, Will, but I did not have that experience. You can surely sell it to junk yards, even without papers for registration, prices starting at 100usd
Hi Alex, did you go with the seller to the DMV? and Did you get the insurance before paying the seller?
My question goes on the practical term:
-Check the car
-Pay the seller and sign pinkslip
-go to insurance office, get insurance
-go to DMV and register car.
Does the seller come with through all of this ? or do you do this alone?
Hi Martin,
Yes, went to DMV with the seller
No about the insurance in advance, but you can do it. Arange it and pay for it, then when the deal is done, you can call to have it signed with the car data. This way you are covered all the time. I arranged to have it right after. So I drove for about 15min without insurance. The seller comes with you to DMV and that’s about it. Signed, paid, and good bye. Insurance is all up to you.
Alex, thanks a lot for replying. Do you know if its accustomed for the seller to go with the buyer to the DMV? What reason has he to go with you, AFAIK the seller only has to sign the pinkslip and thats it.
Does he have to sign the Pinkslip at the DMV? So, he signs and you payed him afterwards]?
PD: I wanted to continue reading your blog, seems very interesting, but I dont know where I can see a list of entries in a chronological order. I got to this post because you linked it in the Tripda forums.
Thank you
Unfortunately I can’t tell you that exactly. I was probably lucky to buy the car from a nice family who came to DMV with me and spent there about 15min till everything was fine. Probably the pinkslip is enough. I would appreciate if you do it this way and maybe come back with info. In my case I realize now that I paid them right after the car was on my name, not even before.
About the blog, I’m sorry it’s not very readable in mobile version. If you open the blog on the PC, the posts are in chronological order on the right hand column, starting with the newest one. On mobile, the posts are all the way down, so you have to scroll past the comments; and again, starting with the newest one.
Sorry, alex, one last thing, maybe its specific to AZ, I just realized that in CA, where Ill buy the car in order to register it you need proof of insurance, so Id need to get insurance first.
That is possible, thanks for sharing. Different US states, different requirements. In AZ, insurance could be purchased directly at the DMV, but the price was almost double than what I found on the street.
Can you get trouble for using an address of a place you don’t live (like worst case scenario, with accidents and stuff)
I’d say no. They might send documents to that address you used, but as soon as the people living there will report it, they will start tracking you by other means. After all, the insurance company has a copy of your real passport /documents. However, if that is punishable by law, I believe that they would tell you before signing.
Thanks for this great informative post! Just have one question that seems very hard to find a definite answer to, but is vital for our plans:
Is it possible to buy/register/insure a car without IDP (International Drivers Permit)?
To be honest, nobody checked if I have one. Theoretically speaking, the one I have is in English as well, so I could argue that is international had they asked. Strictly speaking I didn’t have the official papers that count as IDP. Nobody checked me and maybe I was lucky. I didn’t drive with fear that I’d be stopped and I’m illegal
This was a useful blog and comments (it’s like the stone soup yarn) so I’d like to add some more info to it. I am from Australia and have bought RVs in the US several times (including last week) – I use a mailing service to get a physical residential address and can buy any vehicle this way in FL, AZ, or CA (as these states do not require me to have a US drivers licence as id as part of the registration process – states like TX do). An example mailing service is SBI in Florida. I could also buy in any state but would need to drive to one if the above on a temporary plate to get it registered. For insurance I use my US residential address and my International drivers licence. I’ve used Progressive and National General (which is usually cheaper) and never had any problems. I would strongly suggest you get insurance, and if you’re only here for a short time then pay them by the month rather than the annual premium. LastlY, depending on where you buy you may need an annual inspection and/or smog check. FL and most of AZ is best for this as they don’t have any inspections or smog checks at all whereas many parts if CA Do. Also use dmv.com as a resource. Hope that helps clear up some of the mystery about buying a vehicle over here!
Thanks Gareth! quite useful indeed. Turns out I was really lucky for purchasing the car in AZ.