While you may have entirely valid reasons for trying to line up a buyer for your Tesla on delivery day (such as changing life circumstances, unique opportunities, etc.), there are a few snags you’ll probably run into if you try to sell your Tesla too soon after (or even before) delivery. If you want to avoid some major sales headaches, read on!
First, we’ll take a look at how to get your Tesla’s title and why trying to sell a Tesla without a title can be difficult. Then, we’ll discuss whether or not you can sell your Tesla reservation, and what best practices you can follow when you need to sell your Tesla quickly.
Before we go any further, it’s time for a disclaimer: while we are experts in the used EV/Tesla world, this post does not constitute financial, legal, or tax advice. Please consult financial, legal, and tax professionals in order to get advice for your specific situation.
How Do I Get My New Tesla’s Title?
Because each state has different laws regarding how titles are processed, Tesla may or may not be responsible for submitting your title and registration paperwork. Visit Tesla’s page Registering Your Tesla for more information on what they currently do for titles on a state-by-state basis.
Why Selling Your Tesla Without a Title is a Problem
Note: While we put most of our focus on Teslas throughout this article, we’d like to point out that these concepts apply to other EV brands, too.
Trying to sell any car without a title can be a major hassle, and selling a Tesla without a title is no different. There are several reasons why it’s better for you as a seller to have finished all the registration and title paperwork AND have your title present (or, in the case of a loan, accessible at your financing institution) before trying to sell:
- If you hand over your Tesla without signing over the title at the time of the sale, you can still be responsible for any incidents that Tesla is involved in.
- In some states, you cannot legally sell a Tesla without transferring ownership on the physical title.
- Selling your Tesla to someone else before delivery day can leave you or your buyer without proof of ownership. This problem could get you into some interesting legal difficulties when tax season rolls around (for more details on potential issues in this area, talk to your tax advisor).
- Despite the fact that you legally own your Tesla after delivery while waiting for your Tesla’s title, not having physical possession of your title can be a pretty big red flag to potential buyers
Obviously, state and local laws vary widely, so you’ll need to check in with your local DMV in the state where you took (or will take) delivery of your Tesla. There are different procedures, taxes, and kinds of paperwork necessary in each state to keep all your records straight, satisfy your insurance, and so on.
To give you a better idea on what issues you might face while getting your title and selling your Tesla soon after delivery, here are three state examples:
State Example #1: Selling a Tesla in Texas
Since various Texas laws don’t currently allow Tesla to sell Texas residents one of their vehicles directly (we know, it’s weird), consumers have to order online and have their Tesla delivered with a temporary tag (temporary paper license plate). Unlike a dealership, Tesla (as a manufacturer) doesn’t file title paperwork in the Lone Star State. That step is up to the consumer.
Tesla sends a packet of papers after delivery, some of which will give instructions on how to register a new Tesla at the local DMV. No actual title will be sent to the new owner by the state until all the paperwork has been filed, local and state taxes have been paid, and so on. This typically only takes a few weeks but can extend over a month, depending on the speed of the DMV or availability of appointments.
This means that Texas residents are left without a physical title in hand for a decent amount of time after delivery.
Texas also does not allow the ownership transfer of a vehicle unless the seller has the actual title. This means, for example, that if you sell a Tesla Model 3 on delivery day in Texas, you will still legally be the owner even with a bill of sale drawn up. Your ownership (and liability) would continue until the paper title came in and you could complete the transfer process with your buyer. In the meantime, anything could happen to the car, and you would likely be held responsible.
For current information on Texas title and registration requirements, we encourage you to check out the Texas Department of Transportation’s website or visit your local DMV.
State Example #2: Selling a Tesla in California
Getting a title and registration in California is simpler than in Texas: Tesla completes your registration and the DMV should mail you your registration card and title.
This process still takes time. You’ll have temporary tags so you can drive, but you may have to wait 2-3 weeks before you receive your actual title. And while there used to be an expedited title option in CA, at the time of writing, that option has been suspended.
Can you still sell or transfer a Tesla in California without a title? Potentially (via the Certificate of Title or Application for Duplicate or Paperless Title – REG 227 and the Vehicle Transfer and Reassignment Form – REG 262), but fine print in the paperwork suggests that you really should consult with your local DMV and state regulations before attempting it.
We recommend that CA residents visit their local DMV or visit California’s Department of Motor Vehicles website for more info.
State Example #3: Selling a Tesla in Arizona
The State of Arizona does allow the use of eTitles (filing a title electronically), so we figured we’d add it to our examples. The eTitle can save you time when you are transferring your title to another buyer. This process can make vehicle ownership and title transfer incredibly fast when dealerships and used vehicles are involved.
However, new Tesla owners in AZ still won’t have access to their title until it is processed, though it isn’t mailed to them as a physical copy unless requested. And as far as we know, the eTitle transfer option can’t be used for a sale right after delivery unless the title has been processed online. This may be faster than traditionally mailed titles, but it’s not immediate.
Check out Arizona’s Department of Transportation website for more information on that state’s title requirements and procedures.
Considerations for Selling a Tesla Out Of State Without the Title
While we don’t doubt that someone has found a way to make this work, selling your Tesla to an out of state buyer (a very common situation) without the title in hand can cause all kinds of problems for you and your buyer.
For instance, states have differing requirements on how soon registration needs to be completed after a transfer and typically need the title present for the transfer to be considered legal. If either party experiences a delay, your buyer may have an unregistered/undriveable vehicle and you may both end up with a major legal headache on your hands.
Once again, we’d like to remind you that we are experts in EVs, not title law. This post expresses our research and opinions, but it does not constitute financial, legal, or tax advice. Please consult financial, legal, and tax professionals in order to get advice for your specific situation.
Can I sell my Tesla Reservation?
We get quite a lot of questions on this subject! Selling your Tesla reservation can seem like a good workaround to getting some cash back for your spot in the reservation line. However, there are problems with this tactic.
While the short answer to the question “can I sell my Tesla reservation?” is no (especially if you want to be able to buy from Tesla in the future), the longer answer to this question is “usually not, and it’s generally frowned upon.”
Tesla does not support transfer or sale of their reservations. And they have a point: allowing someone else to buy up and sell their reservations defeats the purpose of the reservation system.
Tesla states clearly in their reservation confirmation letter that your reservation is not supposed to be sold or transferred “without prior written consent” from Tesla. While this is generally meant to discourage transfer and sale of reservations entirely, Tesla may work with you to transfer your reservation in situations such as divorce or other life issues (but not for the purpose of flipping or selling it in another way—this is a big no-no).
There have been instances where reservation holders have used the loophole of giving over control of their entire Tesla account to a buyer in order to sell a reservation slot, but this comes at a cost to the seller. Tesla may restrict your ability to place any reservations or the ability to buy from them at all if they discover that you have sold or transferred your reservation without their permission.
Plus, it’s generally a bad idea to let a buyer (who may be a complete stranger to you) have control of an account that’s been tied to your personal info.
Please note that, as a policy, we do not allow Tesla reservations or cars not actually in the physical possession of the owner to be listed and sold on our site. These situations open up our customers to scams and shady car selling practices, and we want to keep our listings as safe as possible for our buyers and sellers.
Ford, Rivian, Chevrolet, and others all actively discourage selling reservations for their EVs. Like Tesla, these EV manufacturers are not happy with having their reservations treated like overpriced tickets at popular sporting events.
So, the answer is—no, you can’t sell a Tesla reservation (and don’t look to us for help with that). But if you fully own your Tesla (and it’s not a reservation), and you’re wondering “where can I sell my Tesla?” That’s a different story!
A Note to the Casual Tesla Reseller
While making a quick profit by flipping a new Tesla sounds good in theory, did you know that a clause in your buyer’s agreement could get you banned from buying new Teslas in the future?
Here’s the relevant clause from Tesla’s Motor Vehicle Buyer Agreement: “Tesla and its affiliates sell cars directly to end-consumers, and we may unilaterally cancel any order that we believe has been made with a view toward resale of the Vehicle or that has otherwise been made in bad faith, and we’ll keep your Order Fee, Order Deposit and Transportation Fee. This includes orders for which a third-party is facilitating or brokering the sale, or if the vehicles are to be exported to somewhere other than where you tell us you will be registering the Vehicle.” [emphasis added by us]
In other words, you may hit the Tesla blacklist if the Tesla Loss Prevention Team discovers that you’ve been purchasing new Teslas from them with intent to immediately sell. While this consequence typically gets leveled at buyers who are purchasing and selling multiple new Teslas, you may run afoul of it by trying to pre-arrange the sale of your Tesla before you’ve even taken delivery.
So, be careful when buying and selling—and be sure to follow the rules that Tesla lays out at all times to ensure that you don’t wind up in any trouble with them.
Used Teslas, however, are a different story. For more information, check out our post about flipping used Teslas and other used EVs.
Selling Your Tesla Quickly: Best Practices
We’ve already been over titling issues at length, but since good info bears repeating, it’s best to have received your title and made all the necessary state tax and registration payments before you start trying to contract a buyer for your Tesla. Having your title accessible before you make arrangements with buyers will help the process go much more smoothly.
Along the same lines, it’s also a great idea to have that title in hand before you even create a used EV listing. Having your title ready helps you create more confidence in potential buyers and lets you get a sale wrapped up more quickly (and with less uncertainty and irritation for everyone involved).
If you’ve got that title (or are at least close to getting it) and are hoping to sell your Tesla quickly, it’s definitely worth your time to create a listing to get your Tesla in front of potential buyers as soon as possible. Check out our article 4 tips to Sell Your Tesla Faster for ideas on creating an attractive listing.
However, there is another fast way to sell a Tesla or other EV quickly (and, bonus, you can do it at the same time as creating a listing with us): get an EV Cash Offer from one of our trusted dealer partners! These Tesla and EV experts will give you a fair, accurate, no-obligation offer for your vehicle.