The liability and legal aspects of selling motorcycles can either be overlooked or overwhelming when listing your used model on the market. While landing a fast sale, earning top dollar for your ride, and potentially upgrading to a new bike are all exciting possibilities of the transaction, you don’t want a legal loophole disrupting the process. Cycle Trader is sharing six common legal steps you should consider when selling your used motorcycle.
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1. Ensure All Paperwork is in Order
As you move along in the sales transaction with a serious shopper, get all your paperwork in order and completed prior to the final steps of the sale. This includes the preparation of the title, knowing what’s needed for the bill of sale, a release of liability form, service history essentials, and other state-mandated documents. For example, some states require an odometer disclosure or emissions certificate, so be sure to understand the requirements where you’re selling. A properly documented sale will protect you legally and build trust with the buyer.
2. Look Out for Outstanding Loans
If you still owe money on your motorcycle, you need to settle outstanding loans related to your bike before you transfer the title to the new owner. Some lenders will hold the title until the loan is fully paid, which means you’ll need to work with them during the transaction, so keep this in mind with your timeframe for selling. Make sure you inform the buyer of the situation so there aren’t any surprises or disruptions during the process.
3. Transfer of Ownership
One of the most important legal steps when selling your motorcycle is the transfer of the ownership title to the buyer. The process varies by state, but generally you will need to sign the title over to the new owner so they can legally register the motorcycle to their name. Make sure you complete all required fields on your title and obtain required signatures; you can consult your trusted financial institution to help with this step of the transaction for a safe transfer of ownership.
In some states, additional documentation like a bill of sale might be required to confirm the transaction. Failure to properly transfer the ownership can leave you liable for any accidents, tickets, or legal issues that arise with the motorcycle after the sale.
4. Release of Liability
Once your ownership has been transferred, you need to submit a release of liability form to your state’s Department of Motor Vehicles (DMV). This document notifies the state that you are no longer responsible for the motorcycle. For instance, if the new owner gets into an accident or racks up parking tickets, the release of liability ensures that you are not held accountable. Again, each state has its own timeline for submitting this form, so check with your local DMV to ensure you file it promptly after the sale so things don’t slow down during the transaction.
5. Handle Payments Securely
Online marketplaces like Cycle Trader are trusted and secure for safe transactions when you sell a motorcycle. When you sell your bike, take extra measures to handle payments securely and in a traceable manner. Exercise caution when you’re offered cash or cashier’s checks for your motorcycle, and instead opt for electronic payments or certified checks for additional security. If you choose checks as a payment option, verify with your financial institution that it’s legitimate before handing over the keys and title. Avoid personal checks because they can bounce and leave you without a payment, and you could potentially be dealing with a fraudulent buyer.
Consider meeting the buyer at your bank or financial institution where funds can be safely verified and transferred. This secure payment process helps avoid a scam during the sale.
6. Be Aware of State and Local Laws
Every state has its own set of laws and regulations regarding the sale of motor vehicles, including motorcycles. Do your research on the specific legal requirements in your area to ensure you’re complying with applicable rules. This includes sales tax obligations, necessary inspections, and emissions regulations that may apply. Failing to follow these laws can lead to fines or delays in the sale, so stay informed before you finalize the deal. It’s also a good idea to make sure the buyer knows all their local laws regarding motorcycle ownership, especially if they’re purchasing from another state. This will help prevent a transaction coming back around to you with a buyer that wants to return the bike, or negative feedback in a review.
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Keep these basic legal considerations in mind when you enter the sale. Take the necessary steps and extra precautions so you’re planned and ready for what might come up during the transaction to help prevent legal issues associated with selling. When you’re ready to list, visit Cycle Trader to connect to shoppers nationwide who are ready to buy your bike.
Legal Disclaimer: The information provided in this blog does not, and is not intended to, constitute legal advice; instead, all information, content and materials available in this blog are for general informational purposes only. Information in this blog may not constitute the most up-to-date legal or other information, and readers of this blog should contact their attorney to obtain advice regarding any particular legal matter. No reader of this blog should act or refrain from acting on the basis of information in this blog without first seeking legal advice from counsel in the relevant jurisdiction. Only your individual attorney can provide assurances that the information contained in this blog – and your interpretation of it – is applicable or appropriate to your particular situation.
