The purchase of vehicles in Montana is governed by various laws outlined in the Montana Code Annotated (MCA), specifically Title 61, Chapter 3, and Chapter 4. These laws and the Lemon Law regulate the buying process for vehicles in the state.
The Montana Motor Vehicle Division (MVD) plays a vital role in a proper and lawful transaction. Operating under the Department of Justice (DOJ) authority, the MVD implements and enforces guidelines relevant to the sale and purchase of vehicles in Montana.
Following these established guidelines is essential for buyers as it enables them to obtain a clear title and register the vehicle correctly in their name. Adherence to these guidelines help sellers fulfill all legal obligations and avoid potential liabilities associated with the sold vehicle.
Buyers and sellers can enjoy a smooth and secure vehicle transaction by adhering to these procedures.
What Is the Process for Buying a Car in Montana?
The vehicle acquisition process in Montana differs based on the purchase source—a local dealership, an out-of-state seller, or a private individual. The MVD has developed distinct protocols for each scenario to maintain accuracy and consistency.
Buying from a Dealer in Montana
Licensed car dealerships in Montana generally manage the bulk of the paperwork during a vehicle purchase, easing the buyer's administrative load. Nevertheless, purchasers still have important responsibilities for a seamless and protected transaction:
Title Verification
Caution and preparation are key when approaching dealerships for a car purchase. Select a licensed, reputable dealer and confirm their active status through the Montana MVD. To verify a dealer's legal licensing, contact dojdealerinfo@mt.gov or call the MVD's Vehicle Services Bureau at 406-444-3661, selecting option 3.
Additionally, investigate the dealer's reputation by examining customer reviews. Reliable dealerships provide transparent information about vehicle history, pricing, and warranties. Scrutinize these details to make well-informed choices and reduce potential purchase complications.
Buyer's Guide
Dealerships must provide a Buyer's Guide for each vehicle, as mandated by the Federal Trade Commission (FTC) and adopted by Montana. This guide, usually displayed on the vehicle's window for easy access, aids buyers in understanding costs and vehicle conditions.
When examining the Buyer's Guide, look for these key elements:
- Vehicle specifications (make, model, year)
- Previous usage history
- Dealer's acquisition method
- Disclosure of major mechanical issues and repairs
- Information on any prior fire, flood, or collision damage
- Warranty details provided by the dealer
This information helps promote transparency and informed decision-making during the purchase process.
Transfer of License Plates
Montana allows vehicle owners to transfer their existing license plates to newly purchased vehicles. However, this transfer is only permissible when a County Treasurer's office properly registers the new vehicle.
Buyers must notify the dealer of their intention to transfer their current license plate to the new vehicle. This information is crucial for the dealer to complete the required documentation accurately. It will also help the buyer know if the dealer can facilitate this transfer.
Additional fees apply for personalized or special license plates, varying based on the plate type. Buyers interested in these options must complete the Application for Personalized License Plates (MV8). Dealers and buyers can utilize the Montana MVD's License Plate Lookup tool to explore available license plate options. The fees vary depending on the plate type.
Proof of Purchase
In Montana, maintaining comprehensive transaction records is essential for vehicle sellers. This documentation serves as a vital sale record, safeguarding the seller's interests and providing buyers with proof of purchase for potential future disputes or legal matters. Sellers are required to furnish this documentation to the buyer, which should include:
- Full names and current addresses of both buyer and seller
- Vehicle details (year, make, model, and VIN)
- Buyer's driver's license number
- Agreed purchase price
- Sale date
- Signatures of both parties
This documentation can be provided in one of two formats:
- A photocopy of the reassigned title with all relevant information completed
- A separate document containing all required details
The Montana DOJ offers an official Bill of Sale (MV24) form to capture all necessary transaction information for ease of use. The details on this form must correspond with the sales information included in the Application for Certificate of Title for a Motor Vehicle (MV1) form during registration.
Odometer Disclosure Statement
Accurate documentation of the vehicle's mileage is a crucial responsibility for sellers, who must provide this information to buyers.
For this, sellers and buyers can use the Odometer/Statement of Sale Section on Form MV1. However, sellers are strongly encouraged to complete the Odometer Disclosure section of Form MV24. It's worth noting that MV24 serves as proof of purchase and includes the odometer reading.
For vehicles from 2011 or newer, sellers must use a separate form—the Odometer Disclosure Statement (MV904)—to document the mileage.
The provision of accurate mileage disclosure serves multiple purposes:
- It maintains precise vehicle records, safeguards both buyers and sellers
- It complies with state regulations.
Although the process may appear burdensome, this additional documentation is crucial in preventing potential disputes. Moreover, these records allow all parties to access clear, mutually agreed-upon information regarding the vehicle's condition and history.
90-Day Temporary Registration
When a buyer purchases a vehicle or chooses a license plate that is not immediately available, the Country Treasurer or the dealership can issue a 90-day temporary registration permit (TRP).
This TRP allows buyers to legally operate their newly purchased vehicle while awaiting their permanent registration and plates. Generated electronically, each TRP features a unique number and comes with a detachable proof of temporary vehicle registration.
Buyers should place the permit in the provided plastic sleeve and attach it to the vehicle's rear, where the license plate is typically located. Upon receiving their permanent registration and plates, buyers must remove and replace the TRP with the new plates.
This system enables new vehicle owners to legally drive their vehicles during the processing and delivery period of permanent registration and plates.
Dealers can use the "Temporary Registration Permit Service" online to get the permit. This platform allows users to generate, reissue, and cancel TRPs for recently acquired vehicles.
For more information, refer to the "License Plate Information" page on the official Montana MVD website.
Buying a Vehicle From an Out-of-State Dealer
Montana residents can buy a vehicle from another state, provided that they pay attention to the following key points:
VIN Inspection
VIN inspections, particularly for out-of-state purchases, are available to buyers in Montana. These inspections are typically conducted for several reasons:
- Verifying vehicle descriptions
- Confirming the vehicle matches the title documentation
- Correcting inaccurate title data
- Verifying VIN absence before assigning a state VIN
The inspection process generally involves two stages:
- Stage I: For questionable vehicle identity or submission of Canadian registration or bonded application
- Stage III: For vehicles with out-of-state or Montana salvage certificates
Most buyers require only Stage I inspection. It can be performed by local law enforcement, driver's license exam staff, or county treasurer's office personnel. Buyers must complete the Vehicle/OHV Identification Number Inspection (MV20) form.
For Stage III inspections or more information, buyers should consult the "Vehicle Identification Number (VIN) Inspections" page on the official MVD website.
Buyers have access to complimentary services that can provide valuable vehicle information:
- National Highway Traffic Safety Administration (NHTSA) VIN Decoder
- National Insurance Crime Bureau (NICB) VINCheck Service
These tools can uncover crucial vehicle information, such as theft records, title status, and accident history. Buyers can gain insight into a vehicle's background by utilizing these services, fostering transparency and potentially streamlining the purchase process.
Temporary Registration
After finalizing their purchase and while their vehicle undergoes inspection or registration processing, buyers can obtain a 90-day TRP from the County Treasurer's office. Alternatively, they can utilize the Montana MVD's online "Temporary Registration Permit Service" to acquire this permit.
Title and Registration
Montana law requires vehicle owners to transfer the title to Montana if the vehicle was purchased out-of-state or if an out-of-state lender holds the title. The process is as follows:
- The buyer must obtain a Foreign Title Transfer (MV63) form from their local County Treasurer and complete it.
- The buyer then sends the form to the lender, requesting that the out-of-state title be released to the buyer's local county treasurer's office.
- Once the country treasurer's office receives the lender's request and the out-of-state title, the buyer can complete the title and registration process.
- The new Montana title can be sent to the out-of-state lender if requested.
Buying a Vehicle From a Private Seller
Buying a vehicle from a private seller in Montana often offers cost advantages through direct price negotiation. However, it can also be disadvantageous as private sellers may not offer warranties. For a safe transaction, the Montana MVD advises buyers to take the following precautionary steps:
Title Verification
Buyers must confirm the private seller's legal ownership of the vehicle. The seller should possess the current title assigned to them. In out-of-state vehicles lacking a title, the seller must present registration documents to prove ownership. If the title has been misplaced, the buyer should require the seller to obtain a duplicate title.
Lien and VIN Check
Before the sale, the seller must clear any existing liens on the vehicle. They should then provide the buyer with either a clean title without a lien statement or an official letter from the lienholder confirming the lien's release.
Additionally, the seller must file a Security Interest Action (MV81B) form at the county treasurer's office. Buyers may request a copy of this form or proof of its submission from the seller.
The registration application form contains a section for dealer and lienholder information. The information in this section must align with the details provided on Form MV81B.
Aside from the lien, buyers can also get their vehicles inspected to confirm the vehicle's VIN information. Check the "VIN Inspection" discussion under this guide's "Buying a Vehicle From an Out-of-State Dealer" section for more details.
Vehicle History Reports
When evaluating a potential purchase in Montana, vehicle history reports are essential for buyers. These reports offer crucial background information, enabling well-informed decisions.
Sellers can also use these reports as supplementary documentation for their vehicles, enhancing transparency and fostering buyer trust. Sellers must obtain reports exclusively from the data providers under the National Motor Vehicle Title Information System (NMVTIS). Doing so guarantees reliable and up-to-date information.
These reports typically include:
- Vehicle title information, including current status and ownership transfers
- Date of most recent title issuance
- Official title brands or remarks (e.g., "salvage" or "rebuilt")
- Comprehensive odometer readings
- Records of total loss or salvage declarations
Test Drives and Mechanics
Before finalizing the purchase, buyers may opt to test-drive the vehicle. In such cases, sellers should confirm that the buyer has a valid driver's license. The seller should accompany the buyer as a passenger during the test drive.
Should the buyer request an inspection by an independent mechanic, the seller should engage in a mutual discussion to establish the details. Both parties should agree on who will bear the cost of the inspection.
Proof of Purchase and Odometer Reading
The seller must provide the buyer with proof of the purchase transaction. This proof can be any of the following:
- A photocopy of the reassigned title
- A separate purchase document
- Montana MVD's official Form MV24
Buyers should also request the odometer disclosure statement from the seller. Form MV24 has a dedicated section for the odometer reading. However, if the vehicle is a model year 2011 or newer, the seller must provide the buyer with a separate Form MV904.
Ownership Transfer and Temporary Registration
Once the sale is finalized, the seller must transfer the vehicle's title to the buyer. In Montana, the buyer has a window of 40 days from the date of sale to transfer ownership into their name. It involves applying for the title and registering the vehicle at the County Treasurer's office.
Buyer must complete this transfer within the specified 40-day timeframe. Otherwise, they will have to pay a $10 late fee.
For any inquiries related to the vehicle's title, buyers can contact the Montana MVD at 406-444-3661 or via email at mvdtitleinfo@mt.gov.
If the vehicle is in title processing or pending registration, the buyer can purchase a temporary permit valid for 90 days from the country treasurer's office. For more information, check this guide's "90-Day Temporary Registration" sub-section under the "Buying from a Dealer in Montana" section.
What Are the Fees for Buying a Car in Montana?
When buying a car in Montana, a vehicle owner must be ready for the following fees:
Registration Fee
According to MCA Title 61, Chapter 3, registration fees are separate from the county option tax imposed on light vehicles and those charged instead of taxes on other vehicles. Buyers can register their vehicles for 12 months, 24 months, or permanently.
Like passenger cars, light vehicles are not eligible for permanent registration if the license plate is subject to recertification or annual donation fees.
For registration fees, the rate depends on the age of the vehicle, with an additional 3% administrative fee. Here are some examples:
- The vehicle is four years old or newer: $217
- The vehicle is 5-10 years old: $87
- Vehicle is at least 11 years old: $28
The buyer may also have to pay a county option tax. This tax decreases the older the vehicle becomes.
For more information, check the "Light Vehicle Registration and Fees" page of the official MVD website.
Sales or Excise Tax
Montana has no state-wide sales or excise tax, so buyers do not have to pay taxes when they purchase a vehicle. However, local counties have county options tax that buyers may need to pay during vehicle registration.
Buyers can verify how much county option tax they must pay from their local county treasurer's office.
Other Fees
- Title fee: Vary depending on the type of vehicle
- Replacement title fee (usually for seller): $10.30
- 90-day Temporary Registration: may vary but typically $24
- Late registration fee: $10
- License plate transfer or registration: Varies depending on the type of license plate
- Inspection Fee: Varies by inspection stage and location
- Personalized Plates: Will vary depending on the type of license plate
What Are the Insurance Requirements for Vehicles in Montana?
As per Montana law, it is mandatory to maintain continuous insurance coverage for all vehicles through a state-licensed insurer. The state has established minimum coverage requirements, which include:
- $25,000 per person for bodily injury
- $50,000 per accident for bodily injury
- $25,000 per accident for property damage
Note that failing to uphold insurance coverage after registering a vehicle is considered a violation and is subject to penalties.
Vehicle owners can verify their insurance status online through the Montana Insurance Verification System (MTIVS).
Penalties
In Montana, individuals must carry proof of auto insurance in their vehicles as required by law. Failure to comply with this requirement is considered a misdemeanor, and driving without car insurance can lead to penalties.
For first-time offenders, the penalty for a no-insurance citation can range from $250 to $500. In some cases, a first offense may also result in a jail term of up to 10 days.
Repeat offenders face more severe consequences. A second offense carries a minimum fine of $350 or a 10-day jail term. The offender's driver's license will also be revoked for 90 days. Five points will also be added to their driving record, and the accumulation of 30 points will lead to the revocation of the driver's license.
For a third or subsequent conviction, the penalty includes a fine of $500, imprisonment for up to six months, or both.
Can a Non-Resident Buy a Car in Montana?
Non-residents have the option to purchase a vehicle in Montana. However, they need to be familiar with the regulations and requirements of their home state regarding vehicle registration and taxes. Certain states sometimes mandate that the vehicle be registered and taxes be paid locally upon bringing it into the state.
Additionally, non-residents may need proof of insurance coverage that meets Montana's minimum liability requirements when purchasing a vehicle. Non-resident buyers need to clarify this requirement with their dealer.
Once the non-resident buyer returns to their home state, they must properly title and register the vehicle they purchased in Montana within their state.
Registration as Non-Resident
To register a vehicle in Montana, the non-resident must become a resident. However, they are not obligated to live in the state. Non-residents commonly utilize the services of a Montana-based Limited Liability Company (LLC) to fulfill this requirement.
The LLC is established in Montana, and the vehicle is registered under the LLC's name. If the non-resident plans to become a resident by living in the state instead of getting an LLC, they can also do so.
Once the non-resident becomes a new resident of Montana, they have 60 days to register their vehicle there. They must follow the standard registration process that Montana residents undergo.
Non-residents gainfully employed in Montana must present their current out-of-state vehicle registration to the county treasurer's office. They must pay applicable taxes or fees instead of taxes, along with the necessary registration fees, using U.S. funds only.
Non-residents also have the option to register their vehicles by the calendar quarter. The vehicle must display the license plate or decal from its home state and the one from Montana.