Most of us have dreamed about opening the front door and laying eyes on a beautiful new vehicle complete with one of those festive oversized red bows seen most often in holiday commercials. It’s fun to imagine, though few of us ever actually realize the dream. Far fewer still ever consider that for every lucky recipient of a new (or new to them) vehicle, there was a buyer who had to find the car, buy the car, coordinate auto transport if it was purchased from a faraway seller, and then sort out the details so the happy giftee could take it for a spin right away. All this while keeping it a secret, which is no easy feat when you consider all the paperwork that can go into buying, insuring, and registering a vehicle!
Given how complicated all of that can be, now is the time to get started if you’re planning on giving that special someone a car for the holidays. Tying on that oversized bow will be the very last step, and this post has all the information you need to get from here to there.
First, consider if a car is really the right gift
Many people have strong feelings when it comes to what they drive, and your idea of an amazing car might not be your loved one’s idea of an amazing car. Do yourself a favor, and don’t buy someone in your life a car on a whim. Make sure you understand what they need and what they want in a vehicle.
If you know your dad has fantasized about owning a ‘68 Camaro since he was a teenager — and he has space and the time to care for it — then, by all means, start shopping locally and thinking about auto transport so you can cast a wider net. A better gift for your teenager, on the other hand, might be a surprise visit to nearby used car dealerships to see what’s on the lot.
The other thing you need to consider is your recipient’s finances. A free car sounds like an amazing gift until you consider that it’s a present that comes with obligations like insurance, gas, and maintenance costs attached. If the giftee is someone outside of your immediate family, they may end up paying sales tax on your gift — which could run into money if it’s a new or newer car. Maybe it would make more sense for you to write a nice big check and stuff it in their stocking, so they can shop for a car that fits into their budget.
Finally, if you’re thinking of buying a car for a spouse with whom you pool finances, be aware that they might not appreciate a gift that comes with a monthly payment attached. Debt is never romantic, no matter how big of a bow it’s packaged in.
Still leaning toward gifting a car all wrapped up in ribbons this holiday season? Then read on for some practical advice.
Giving the gift of your old ride
Sometimes giving the gift of a car for the holidays isn’t about buying anything at all. If you have a car that’s not getting driven and you have a special someone in your life who could really use it, putting that oversized bow on it should be a no-brainer. You should make a point of getting all your ducks in a row before you hand over the keys, however.
First, find your car’s title and double check that there are no liens on the vehicle and that you’re the only owner listed. If you co-own the vehicle with someone else, they will have to sign off on the gift. If there are any liens on your car, you’ll need to satisfy those before you can give it as a gift. Can’t find your title? The DMV will be able to issue a replacement.
Are you giving your vehicle to a recipient who lives in a different state? Contact the DMV in that state to find out what requirements you’ll need to meet to give your vehicle as a gift. This is a good time to start looking into auto transport if you won’t be driving the car to your giftee’s location yourself.
If you want them to be able to drive the car right away, make sure that your insurance coverage won’t lapse during the holidays. The recipient will need to get their own insurance coverage as soon as possible after receiving your car, but yours will be sufficient for a few days.
The next thing you’ll need to do is sit down with the title, grab your license, check the odometer, and fill out the transfer section on the back of the title. Where the transfer section asks for a sale price, you can just write ‘gift’. Don’t forget to sign it! Without your signature, the transfer won’t be valid. Keep in mind that there might be other steps you need to take because title transfer procedures vary by state and that a vintage or classic car that passes inspection in one state might fail in another.
Finally, your recipient will need to go to the DMV in their home state and show proof of insurance before they can register the car and get a new title.
Giving the gift of a new car
The easiest way to give a loved one (usually a spouse or a child) the gift of a new car for the holidays is to purchase the car yourself under your own name and then add their name to the title. In most states, you can even add them as a co-owner without them needing to be present. Then, you can sign all the paperwork and insure the vehicle without ruining the surprise.
But let’s say you’re buying a new car for a special someone who isn’t a relative. That’s when things get more complicated. Titling a vehicle in someone else’s name without their ever putting their signature on the paperwork is next to impossible, even if you’re paying cash. Insuring that vehicle will also be tough because insurers will often be reluctant to write policies for people who appear on paper to have no insurable interest in a car. The obvious workaround is to buy the car in your name and then transfer the title once your giftee has purchased their own insurance policy. Just keep in mind that if they’re not a close relative, they may be liable for taxes on your gift. Here’s how it all works:
Financing a gifted vehicle
Can you finance a car you’re going to give as a gift? The short answer is yes, if the recipient is a spouse or you’re buying the car in your own name. It will be easier if the financing and insurance manager you’re dealing with happens to be feeling extra helpful that day. Let them know from the start that you’re trying to buy a car for your spouse for the holidays and you’d like to keep it a secret as long as possible. They’ll know what the DMV rules are in your state regarding titling requirements and may be willing to run your spouse’s credit as well as your own if yours isn’t strong enough to qualify you for financing.
Sometimes when a buyer is making a gift purchase, the dealership will be okay with the recipient signing after the car has been delivered. Again, a lot of this depends on how friendly the financing and insurance manager is feeling. It’s a good idea to call the dealership before you ever step foot inside to get a feel for whether they’ll let you finance a gifted car without the recipient there to co-sign.
Insuring a gifted vehicle
Assuming you’re buying a car for a spouse or a child, insuring it should be easy. Just add it to your policy and try to intercept any postal mail from the insurance company for the next few days to avoid ruining the surprise. It may be harder to ensure that beautiful new car with a big red bow if your recipient is a boyfriend or girlfriend. The vehicle might qualify for temporary insurance through the dealership, but the short-term policy might be pretty expensive.
On the other hand, your current car insurance policy may contain a clause that says you have automatic coverage for 14 or 30 days when you buy an additional vehicle. After that, you have to add the vehicle to your policy to get continued coverage, but the hope is that by the end of two weeks your giftee will have sorted out their own auto insurance. When in doubt, call your agent! Most agents will be more than happy to help you figure out the best way to insure a surprise vehicle, whether that means adding it to your policy or binding the policy, so no paperwork shows up to ruin the surprise.
Shipping a gifted car
If your giftee lives far away or you’re buying a car from a faraway seller, you’re going to need to think about auto transport. As you might suspect, the auto transport industry only works as well as it does because there are smart car shippers coordinating the timing of shipments coming from and going to cities and towns all over the country. The overall number of shipments between Thanksgiving and Christmas stays fairly constant, but from just before Christmas until just after the new year, the pace of deliveries slows down markedly because truck drivers want (and deserve) time off just like everyone else. Meanwhile, the number of snowbirds seeking auto transport jumps leading to a backlog of unshipped cars.
We cannot stress this enough: if your goal is to have that surprise car show up in time for the holidays, book your auto transport as early as possible. Plan for an earlier drop off (ideally in early December, before the rush) and store your recipient’s gift in a friend’s garage. Two weeks before the holidays is good. Three weeks is even better. That will give you lots of time to find and buy one of those big red bows, and you won’t lose sleep wondering if your gift will arrive in time. Or just give your giftee their present early. Who doesn’t like an early holiday present?
Will you pay more to ship a car around the holidays? Maybe! With more truckers emptying their carriers and heading home to be with family, there are fewer spots open on working carriers and so those spots will become more valuable. You can always ask your auto transport company representative if they have any policies specifically related to major holidays. They may also be able to give you more insight about how holiday fluctuations will impact your shipment, so you can plan accordingly.
So, what’s the takeaway? Giving someone, you care about a car for the holidays can be challenging depending on your (and their) situation, but when it’s the right choice, seeing your giftee’s eyes light up when they first spy their new ride will be an amazing feeling. And if giving that gift involves shipping a car? Give yourself the gift of plenty of lead time to coordinate getting the car to its destination. The worst that will happen is that your gift arrives early, and a premature present is definitely better than no present at all.