Buying a Vehicle in Colorado

Title Verification

The state of Colorado imposes strict rules to protect consumers' legal rights. One of these is title verification. If buyers doubt the vehicle title, they can seek help from the National Motor Vehicle Title Information System (NMVTIS).

This system allows instant and reliable electronic checks of paper titles against the issuing state's database. It ensures the accuracy of title information, protects consumers from fraudulent titles and unsafe vehicles, and cautions against the resale of stolen cars.

NMVTIS was established to combat several issues, such as stopping stolen cars from being re-sold across state lines, safeguarding consumers (individuals and businesses) from fraudulent activity, and preventing stolen vehicles from being used for illegal purposes that could fund criminal organizations.

Additionally, NMVTIS empowers consumers to make informed choices by providing information about a vehicle's safety history.

Vehicle History Reports

Buyers must obtain a vehicle history report to conduct a background check on the car's profile. The NMVTIS also provides buyers with detailed information about the car's history.

Using the platform, buyers can access information about the vehicle through the Check History of a Vehicle option. This tab allows them to access the NMVTIS Vehicle History Report. This report focuses on five crucial aspects to help prevent car theft and fraud: the date of the last title, brand history, odometer reading, total loss history, and salvage history.

NMVTIS has lists of Approved NMVTIS Data Providers from which buyers can choose. Alternatively, buyers in Colorado may also request other essential vehicle records using online services provided by the CO DMV. The only difference in their service is that it is limited to the vehicle's background concerning current owner, lienholder information, and document history.

Due to confidentiality concerns, buyers must fill out the Motor Vehicle Requestor Release Affidavit of Intended Use form (DR 2489A). The form justifies the reason behind the attempt to access the vehicle record.

However, buyers are advised to rely on something other than a vehicle history report or record. Thus, a mechanic's inspection is vital in uncovering hidden problems before buying a used car.

Vehicle Identification Number (VIN)/Ownership Documentation Inspection

VIN/ Ownership Documentation Inspection is a crucial step when buying a vehicle from a private seller in Colorado. Checking a VIN involves inspecting the car to confirm the number matches the one on the registration or title.

Colorado has two main types of VIN inspections: VIN Verification and Certified VIN Inspection. Certified VIN Inspections are required for vehicles with registration problems. This often applies to:

• Cars with salvage titles
• Vehicles bought without titles
• Situations with lost, missing, or incorrectly signed titles
• Trailers or vehicles assembled from kits
• Vehicles lacking VINs
• Titling off-road dirt bikes converted for street use

On another note, VIN Verifications are intended for vehicles with clear titles and registration history. This applies when someone owns a car registered in another state and wants to transfer the registration and title to Colorado.

Buyers can have a VIN verified by a licensed car dealer, an emissions inspection station, or a law enforcement officer. Moreover, buyers are advised to book an appointment before the VIN inspection; walk-ins are not allowed. After which, prepare all ownership documentation. This includes titles, bills of sale, and applicable powers of attorney.

The Verification of Vehicle Identification Number Form (DR 2698) should be filled out, and buyers are advised to hand it to the authorized inspection officer in their respective county office.

Odometer Disclosure Statement

Vehicle buyers should be aware of the tendency of odometer fraud. An odometer disclosure requirement allows buyers to obtain accurate vehicle mileage information.

The Federal Truth in Mileage Act of 1986 mandates the accuracy of odometer information. The law strongly advises vehicle owners to state the exact mileage quantity of the vehicle before transferring it to new owners. Anyone caught violating the rule is subject to sanctions stipulated in the cited law.

In Colorado, vehicles manufactured in 2011 or later require odometer disclosure on the title or a secure form until they reach twenty years old. In some cases, odometer disclosure is unnecessary for vehicles at least two decades old or those manufactured in or before model year 2010.

To finalize the sale, the buyer's signature confirming the mileage is necessary. Even with multiple buyers, only one signature is required. Additionally, both the sale date and purchase price should be documented.

Once the odometer disclosure statement is completed, the seller must submit it to the county motor vehicle office along with other pertinent papers. If there are discrepancies, buyers may reconsider the purchase.

Ownership Transfer

Vehicle buyers in Colorado should remember that a proper ownership transfer is part of the buying process. This is a two-way participation between the buyer and the seller.

The seller must properly complete a Statement of Transfer form, and then the buyer must complete a Vehicle Transfer of Title Request form.

Moreover, buyers must provide papers such as proof of insurance, a valid form of ID, the current title properly endorsed by the previous owner, an odometer disclosure statement, a bill of sale (for sales tax purposes), and documentation of security agreement (in case of a lien). The process is handled by a county motor vehicle office where the buyer resides.

License Plates and Registrations

For a vehicle to be registered in Colorado, the buyer must complete a title application. Once the process is cleared, the buyer may obtain license plates.

If the vehicle lacks license plates, the buyer can legally operate it temporarily. This period generally allows for 36 hours of direct travel from the purchase location (point A) to the final destination (point B). However, it is mandatory to have the endorsed title and a bill of sale in possession.

Buyers should not delay and must promptly visit the license plate issuing office in their county of residence, regardless of the temporary operating period. This ensures compliance with registration requirements without exceeding the allowed grace period for temporary operation.

For questions concerning vehicle registration, buyers can call the state DMV at 303-205- 5600 or navigate the online services provided by CO DMV.

Bill of Sale

While only sometimes mandatory in Colorado, a bill of sale is recommended for buyers and sellers during vehicle purchases. This document is a vital transaction record containing key details such as the sale price, date, and identification of all parties involved.

A well-crafted bill of sale goes beyond just recording transaction details. It functions as a legal record in Colorado, potentially proving helpful in future disagreements or problems concerning the vehicle sale.

Licensed Dealer Check

When buying a vehicle from a dealership in Colorado, it is essential for buyers to verify that the dealer is properly licensed. The Colorado DOR maintains a list of licensed dealerships operating legally in the state, which buyers can consult.

Colorado's Open Records Act allows citizens to request access to government documents, including information about dealership licensing and any disciplinary actions taken against them. This can be a useful tool for buyers who want to research a dealership's history.

On another note, the Colorado Motor Vehicle Dealer Board regulates car dealerships in the state. It sets standards for fair business practices, safeguards consumer rights, and ensures dealerships operate according to these guidelines.

Buyer's Guide

Colorado law doesn't directly mandate the Buyer's Guide, but federal regulations from the Federal Trade Commission (FTC) do. This means buyers in Colorado will find a Buyer's Guide window sticker on most used cars at dealerships.

This sticker is a quick reference that informs them whether the car is sold "as is" or has a warranty. It also mentions if the dealership offers optional service contracts and any associated costs.

Federal law also mandates that the Manufacturer's Suggested Retail Price (MSRP) be displayed on a label for new cars, station wagons, and vans. This sticker is a starting point for price negotiations and allows for comparisons between different makes and models.

Note that dealerships may add a separate label detailing the cost of additional equipment, handling fees, and any dealer markup.

Warranties

Warranties are an important consideration when purchasing a vehicle from a licensed dealer in Colorado.

Used vehicles may come with a dealer warranty, which can vary in coverage and duration. Some dealers offer "as-is" sales, meaning the vehicle comes without any warranty. In these cases, the buyer is responsible for all repairs after purchase.

Colorado law requires dealers to provide a written warranty statement for each vehicle they sell. This statement should clearly explain what is and isn't covered and for how long. Buyers should carefully read and understand this document before making a purchase.

Buyers should ask questions about warranties and get all promises in writing. They should also consider purchasing extended warranties for additional coverage, but they should evaluate the cost and benefits carefully before doing so.

Sales Tax

Colorado's sales tax rate is generally 2.9%. However, an additional local tax may be incurred depending on the county office's location.

For example, Winter Park has the highest local sales tax, at 11.2%, while the county of Cheyenne has the lowest rate, at 4.9%.

Documentation Fee

Dealerships may charge a documentation fee for every buyer. This varies depending on the manufacturer or the dealership.

Lastly, be prepared for additional expenses like special license plates, lien recording fees if financing, vehicle inspections in some states, and other relevant service fees. Remember to always ask about these potential fees before finalizing the car purchase.

Title Fee

Buyers in Colorado must pay a $7.20 fee to apply for a title for their newly purchased vehicle.

Registration Fee

Colorado's vehicle registration fee depends on the unit type (car, truck, motorcycle), weight, and applicable county surcharges.

Here's a breakdown of charges depending on the vehicle type:

• Motorcycles and autocycles: $3
• Passenger vehicles: Cars under 2,000 pounds have a base fee of $6. This fee increases incrementally for heavier vehicles. For every 100 pounds up to 4,500 pounds, an extra $0.20 is added.

For vehicles exceeding 4,500 pounds, the base fee jumps to $12.50, with an additional $0.60 charge for every extra 100 pounds.