Buying a Car in Alabama
Buying a new or used car in Alabama? The state has in place specific rules relating to the purchase of automobiles. Learn about some of those rules here.
1. Title Information
Alabama requires a title for any car less than 36 years old. How you acquire the title depends on how you buy the car. If you buy from a dealer, they handle getting the title. If you’re financing the car, however, you won’t get the actual title until you pay off the loan.
If you buy from a private seller, make sure that both you and the seller sign the existing title. You should also get a Bill of Sale for the vehicle, and that bill needs to be notarized. Once you have both papers, go to your local title-and-tag office to get the new title. Since 2006, Alabama has a Web-based title system that can generate a title very quickly. For more answers, check out the Electronic Title Application Processing System or the Alabama Title FAQ.
2. Insurance Information
Alabama requires you to have liability insurance for any car that you buy, with a standard of $25,000 for an individual, $25,000 for property and $50,000 for all injuries in an accident. Or, if you prefer, you can instead get a liability bond or give a cash deposit to the State Treasurer — in either case, the required amount is $50,000.
The state allows you 20 days to get insurance for your new car. In the meantime, you need to have the Bill of Sale and the insurance card for your previous car in your vehicle. When you get the insurance for the new car, you need proof (an insurance card, the policy itself or a premium payment stub) at all times. Alabama has an electronic system where police can check your insurance whenever they pull you over, so make sure you follow regulations. For more details, check out this Liability Insurance Manual.
3. Emission Information
Alabama does not currently have any statewide emission standards.
4. Lemon Law Information
Alabama’s Lemon Law only covers new cars (used cars are considered to be bought “as-is”). The law covers a car for 24 months or 24,000 miles, whichever comes first. In order for a car to fall under the law in this state, any problem with the vehicle must have begun before the timeframe or mileage limit. If a problem continues beyond that limit, the car is still covered as long as the first occurrence was within the required mileage or timeframe.
In order to be considered a lemon in Alabama, the car must either have been brought to a dealer for the same problem at least three times or have been unable to be driven for 30 days within a given year because of the problem. Once you decide the car is a lemon, you must send a registered letter to the dealer and give them one final chance to repair the car. If that fails, you can then file under the law and the dealer will be required to either replace the car or refund your money. Recognize that some warranties and other fees are not refundable.
5. Special Information