Step-by-Step Guide to Used Car Documentation
As you can see lot of paperwork is involved while buying and selling a used car. This step-by-step documentation process will help you smoothly complete the documentation.
Step-1 Transaction Documentation: Once you have finalized the purchase or sale of your used car, you need to finish this documentation. Download transaction documents (SALE AFFIDAVIT, DELIVERY NOTE). Ensure to keep copies of cheque / DD, payment receipts duly signed by the seller. If you are buying from a Certified Dealer doing business with VAT / Service Tax Registration, ask for Tax Invoice.
Step-2 RTO/RC Transfer Documentation: This documentation should be completed at the time of delivery of the vehicle. Documents required will vary based on the type of transfer:
- Transfer with in the same RTO, i.e both seller and buyer are in same RTO jurisdiction ex: with in HR26-Gurgaon RTO (Download documents required: form-29, form-30)
- Transfer from one RTO to Another, i.e both seller and buyer are in different RTO jurisdiction ex: HR51 to HR26, Faridabad-Gurgaon RTO (Download documents required: form-28, form-29, form-30)
Seller’s Note: If you are selling your car to another individual, it is in your best interest that RC Transfer is taken care by you.
And following buyer documents are required to be submitted to the RTO Authority:
- ID Proof of buyer: PAN Card, Passport, Driving Licence, Voter ID, Aadhar Card, etc.
- Address Proof of buyer: Passport, Electricity Bill, Bank Statement, Telephone bill, etc.
- 4 Nos of Passport size Color photographs of buyer
Some RTO’s ask for ID proof and photograph of seller as well
Original RC, copy of insurance and pollution under check (PUC) certificate should be submitted to the RTO along with the above.
Further, you need to submit these following documents based on the nature of transaction.
Original RC is Lost: To issue duplicate RC, you need to submit form-26 and copy of First Information Report (FIR) filed at the police station
Endorsement or Removal of CNG/LPG: You need to submit original bills of CNG/LPG Kit & Cylinder, CNG/LPG approval certificate, etc
Step-3 Finance & Insurance Documentation: Along with RTO documentation the following documentation shall apply if there is removal or addition of lien on to the registration certificate.
Removal of Hypothecation: If seller had purchased the new car with a loan, the RC will have hypothecation of the bank/financier. RC can not be transferred. In order to remove the hypothecation, two copies of Form-35 & No Objection Certificate (NOC) needs to be obtained from the financier, that will be issued only if the loan amount is completely paid off. Typically NOC will have a validity date, you need to ensure the same, else need to obtain fresh NOC.
Addition of Hypothecation: If the buyer has taken to loan to purchase the car, you need to hypothecate the RC in favor of the bank/financier by submitting Form-34 issued by them.
Insurance documentation: Once the RC is transferred in the buyer’s name, car insurance must be transferred by submitting the INSURANCE-TRANSFER Application and copy of RC to the insurance company. Generally insurance company will ask for inspection of the car before transferring insurance. A nominal charge of about Rs.500/- is involved. If the previous policy has no claim bonus (NCB), the amount of NCB needs to be paid by the buyer to get the policy transferred. NCB is always given to the owner of the car for his/her good driving habits and not to the vehicle. Sellers will get a discount on insurance policy on their next car purchase.
If previous car insurance policy is expired or seller is retaining the insurance, fresh policy needs to be taken by the buyer by submitting the copy of RC.
In case used car is purchased under loan hypothecation needs to be added on to the insurance policy.
Important points related to used car documentation you should know:
- If RC transfer is taking longer time or not transferred you should intimate the RTO that you have sold the vehicle along with buyer credentials and a copy of transaction documents. This will help in safe-guard yourself from any untoward incident.
- If you are selling a company car given to you as perquisite, you need to get the documents duly signed by the authorized signatory along with an NOC to get the payment in your name
- In case you have sold your car to another individual, and getting RC transfer done yourself, ensure you get a reliable agent by checking with friends, concierge services agency in your company or your car dealer
- Till the RC is under transfer process, buyers must always carry copy of RC, Insurance, PUC Certificate, Delivery Note, Invoice along with the car and drive safe.
- Once transferred RC copy is received, check if the name & address are correct.
- National Crime Records Bureau (http://ncrb.gov.in/) provides facility to Check for Stolen Vehicle
- It is always safe to have both car keys with you. With latest technology like iCats integrated in to the car keys getting duplicate keys is expensive. Ensure you get both keys from the seller. In case second key is not available, duplicate key can be obtained through authorized manufacturer dealer. You may need to submit a copy of FIR for the same along with car details.
- Cities where latest emission norms are applicable cars that comply with older norms can’t be transferred. National Capital Region-NCR (Delhi, Gurgaon, Faridabad, Noida, Ghaziabad and other districts of Haryana, Uttar Pradesh and Rajasthan), Mumbai, Kolkata, Chennai, Bengaluru, Hyderabad, Ahmedabad, Pune, Surat, Kanpur, Lucknow, Sholapur, Jamshedpur and Agra. Ensure to check, the car you are buying complies with latest emission norms. From 1st April’ 2012 Euro-IV or Bharat Stage-IV norms are applicable. Euro-V or Bharat Stage-V norms shall be applicable from 1 April 2017 (proposed). Source Wikipedia.