How to Transfer Ownership of a Car After a Death: Step-By-Step

GJ

Gary Stern, JD

Consultant, retired attorney

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Whether it is a collectible, a luxury vehicle, or a means to help your kids get to school safely, a car can be an essential asset in your life. Unfortunately, you cannot take your car with you when you die. Like real estate, stock, or any other asset, a vehicle transfers to a new owner after the prior owner's death.

Jump ahead to these sections:

• Who's Responsible for Transferring the Ownership of a Car After a Death?
• What Documents or Information Will You Need to Transfer Ownership of the Car?
• Steps for Transferring Ownership of a Car After a Death

Transferring car ownership after death involves more than just giving the keys to a new owner. This article discusses how to transfer ownership of a car after a death.

Who's Responsible for Transferring the Ownership of a Car After a Death?

Because the prior owner is no longer alive, someone else must be responsible for transferring the car's ownership. Determining who is liable depends on how the deceased owned vehicle: If the deceased was the sole owner of the car, it transfers to the person's estate. The person responsible for the estate will be either an executor or an administrator. This person will also be responsible for assigning the new owners of any cars.

If the car is owned jointly between the deceased and another person who has rights of survivorship, it transfers to that person. If they choose not to keep the vehicle, they will be responsible for transferring its ownership.

If the car is owned in trust, the trustee is responsible for transferring the ownership.

What Documents or Information Will You Need to Transfer Ownership of the Car?

You need several key items to transfer ownership of a car after a death:

1. You will need any relevant estate planning documents, which can be the deceased's will and/or the trust agreement. These items are necessary for two reasons: they can define who's supposed to get the car. They also name the estate executor or the trustee, who will be responsible for transferring the vehicle to the new owner (as described above).
2. You will need all relevant documents establishing the car's current owner. This can be the car's "title," although it may be called something different in your state.
3. You will need to prove you have insurance for the car.
4. You will need to know something about your state's laws governing how to properly transfer car ownership and something about your state's probate laws. Probate is the legal process that administers an estate . You need to know how probate works and if there are any exemptions to probate that apply in your case.

Probate laws are not federal laws. They only exist at the state and county levels. As there are 50 different states and more than 3,000 counties in the U.S., it is helpful to consult with a lawyer experienced in transferring car ownership after death in the specific state or county relevant to your situation.

Steps for Transferring Ownership of a Car After a Death

There are specific steps to properly transfer car ownership after a death. These steps will vary depending on whether the transfer is subject to probate.

Transfers subject to probate

If the deceased was the sole owner of the car, the transfer of ownership of the vehicle after death is subject to probate. Exceptions may apply in the case of "small estate affidavits" or "transfer on death" clauses, which we will delve further into below.

These are the steps to follow if your case is subject to probate:

• File documents with a probate court judge to open a probate estate.
• The probate court judge will issue letters of office to an executor or an estate administrator. These establish the executor or administrator's authority to manage the estate, including any cars.
• The executor or administrator then conducts an inventory and collects the estate's assets, including any cars.
• The executor or administrator uses the estate assets to pay debts.
• The executor or administrator then distributes the remaining assets, including any cars, to the beneficiaries. This involves two steps:
  • First, the administrator or executor must determine who the beneficiaries are. If the deceased left a will, that would determine who the beneficiaries are. A will can directly give the car to someone, or it may refer more indirectly to "personal property" or "all assets." If the deceased did not write a will, the heirs are determined based on the state "intestacy" laws. Intestacy laws define who inherits the estate if there is no will.
  • Second, after determining who the beneficiaries or heirs are, the executor or administrator distributes the assets, including any cars, to those people. For cars, in most states, this step involves the executor or administrator completing some documents that a state's Department or Registry of Motor Vehicles may require. These documents are commonly referred to by such names as "Application for Certificate of Title," "Application for Title and/or Registration," "Application for Vehicle Transaction," or "Transfer of Vehicle Registered in Name of Deceased Person." It may be necessary to provide copies of a death certificate and letters of office to the applicable state or county agency.

  Transfer not subject to probate

  You may want to avoid probate. After all, transferring ownership of a car through probate incurs time delays and costs .

  Four exceptions can enable you to transfer ownership of a car after death without going through probate:

  • First, estates below a certain size may qualify for the "small estate affidavit" exception, which allows transferring a car using an affidavit outside the probate process. The definition of a "small estate" varies by state. For example, in Illinois, you can use a "small estate affidavit" when the value of the estate is less than $100,000, and the estate does not include real estate.
  • Second, some states allow a "transfer on death" exception, which allows someone to name a beneficiary for their car while they're still alive. On the person's death, car ownership can be transferred to the beneficiary without probate. The key to this exception is ensuring you file a proper "transfer on death" form with the appropriate authority before death.
  • Third, having joint ownership of a car with rights of survivorship allows a vehicle to transfer on death without probate. On the death of one of the joint owners, the surviving owner can take over the car without probate. You must write this into the car's ownership papers before you die.
  • Fourth, holding a car in a trust permits the vehicle to transfer on death based on the trust agreement. These trusts are often called "Living Trusts" and must be put in place while you're still alive.

  Even if any of these exceptions apply, it is still necessary to formally transfer ownership to the appropriate beneficiaries by completing documents required by the state or county agency that administers car titles (as described above).

  Once the car transfers, it is essential to change any insurance policies for the car to match the new ownership.

  Importance of Pre-Death Planning to Transfer Car Ownership

  The death of a loved one is an emotionally painful experience.

  With its time delays and costs, probate can impose an additional burden on the family. By engaging in some pre-death planning by writing a "transfer on death" clause into your will, establishing a "joint tenancy with rights of survivorship" for your car, or setting up a trust, you can avoid probate. This enables car ownership to transfer after death in a less burdensome manner.

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