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resale used car law in Virginia


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#1 kellot

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Posted 15 January 2013 - 11:05 PM

1. Where can I find the law regarding the limit of an individual selling used car per year? I heard it's 5.
2. Some of the dealers such as Mercedes Benz will require the consumer to sign a non-export agreement. If the buyer export the car to a foreign country, there would be a fine or some other penalty. But if the buyer sells the car to a third party and somehow the third party exports the car to a foreign country, will the original buyer be liable to the activity?

thanks in advance!!!

#2 Tax_Counsel

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Posted 16 January 2013 - 01:33 AM

1. Where can I find the law regarding the limit of an individual selling used car per year? I heard it's 5.


There is no limit on the number you may sell. However, if you sell or offer to sell (even if the sale never occcurs) five or more motor vehicles in any consecutive 12 month period in Virginia, that's one of the ways you become a "motor vechicle dealer" in Virginia, thus subjecting you to all the rules for motor vehicle dealers found in Title 46.2, chapter 15 of the Virginia Code. What that means is the "limit" you may sell or offer to sell in VA without becoming a dealer under this provision is four vehicles. Once you sell or offer to sell the fifth vehicle, you are a dealer under this definition. Specifically, Virginia Code section 46.2-1500 defines motor vehicle dealer as follows:

"Motor vehicle dealer" or "dealer" means any person who:

1. For commission, money, or other thing of value, buys, sells, exchanges, either outright or on conditional sale, bailment lease, chattel mortgage, or otherwise or arranges or offers or attempts to solicit or negotiate on behalf of others a sale, purchase, or exchange of an interest in new motor vehicles, new and used motor vehicles, or used motor vehicles alone, whether or not the motor vehicles are owned by him; or

2. Is wholly or partly engaged in the business of selling new motor vehicles, new and used motor vehicles, or used motor vehicles only, whether or not the motor vehicles are owned by him; or

3. Offers to sell, sells, displays, or permits the display for sale, of five or more motor vehicles within any 12 consecutive months.


The term "motor vehicle dealer" does not include:

1. Receivers, trustees, administrators, executors, guardians, conservators or other persons appointed by or acting under judgment or order of any court or their employees when engaged in the specific performance of their duties as employees.

2. Public officers, their deputies, assistants, or employees, while performing their official duties.

3. Persons other than business entities primarily engaged in the leasing or renting of motor vehicles to others when selling or offering such vehicles for sale at retail, disposing of motor vehicles acquired for their own use and actually so used, when the vehicles have been so acquired and used in good faith and not for the purpose of avoiding the provisions of this chapter.

4. Persons dealing solely in the sale and distribution of funeral vehicles, including motor vehicles adapted therefor; however, this exemption shall not exempt any person from the provisions of 46.2-1519, 46.2-1520 and 46.2-1548.

5. Any financial institution chartered or authorized to do business under the laws of the Commonwealth or the United States which may have received title to a motor vehicle in the normal course of its business by reason of a foreclosure, other taking, repossession, or voluntary reconveyance to that institution occurring as a result of any loan secured by a lien on the vehicle.

6. An employee of an organization arranging for the purchase or lease by the organization of vehicles for use in the organization's business.

7. Any person licensed to sell real estate who sells a manufactured home or similar vehicle in conjunction with the sale of the parcel of land on which the manufactured home or similar vehicle is located.

8. Any person who permits the operation of a motor vehicle show or permits the display of motor vehicles for sale by any motor vehicle dealer licensed under this chapter.

9. An insurance company authorized to do business in the Commonwealth that sells or disposes of vehicles under a contract with its insured in the regular course of business.

10. Any publication, broadcast, or other communications media when engaged in the business of advertising, but not otherwise arranging for the sale of vehicles owned by others.

11. Any person dealing solely in the sale or lease of vehicles designed exclusively for off-road use.

12. Any credit union authorized to do business in Virginia, provided the credit union does not receive a commission, money, or other thing of value directly from a motor vehicle dealer.

13. Any person licensed as a manufactured home dealer, broker, manufacturer, or salesperson under Chapter 4.2 ( 36-85.16 et seq.) of Title 36.

14. The State Department of Social Services or local departments of social services.


2. Some of the dealers such as Mercedes Benz will require the consumer to sign a non-export agreement. If the buyer export the car to a foreign country, there would be a fine or some other penalty. But if the buyer sells the car to a third party and somehow the third party exports the car to a foreign country, will the original buyer be liable to the activity?


That depends on the details of the agreement the buyer has with the dealer. However, it's not hard to imagine that if the buyer acts in concert with the third party to arrage the foreign sale that the buyer may well be liable for whatever damages apply for the breach of the contract.

If you are thinking of trying to do any sort of routine sales of vehicles or selling vehicles outside the U.S, either directly or indirectly using a third party, I strongly advise you to consult an attorney first. There are a lot of things that you could do here that could cause you significant legal problems if you don't know what you are doing.

#3 kellot

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Posted 16 January 2013 - 05:21 AM

There is no limit on the number you may sell. However, if you sell or offer to sell (even if the sale never occcurs) five or more motor vehicles in any consecutive 12 month period in Virginia, that's one of the ways you become a "motor vechicle dealer" in Virginia, thus subjecting you to all the rules for motor vehicle dealers found in Title 46.2, chapter 15 of the Virginia Code. What that means is the "limit" you may sell or offer to sell in VA without becoming a dealer under this provision is four vehicles. Once you sell or offer to sell the fifth vehicle, you are a dealer under this definition. Specifically, Virginia Code section 46.2-1500 defines motor vehicle dealer as follows:

"Motor vehicle dealer" or "dealer" means any person who:

1. For commission, money, or other thing of value, buys, sells, exchanges, either outright or on conditional sale, bailment lease, chattel mortgage, or otherwise or arranges or offers or attempts to solicit or negotiate on behalf of others a sale, purchase, or exchange of an interest in new motor vehicles, new and used motor vehicles, or used motor vehicles alone, whether or not the motor vehicles are owned by him; or

2. Is wholly or partly engaged in the business of selling new motor vehicles, new and used motor vehicles, or used motor vehicles only, whether or not the motor vehicles are owned by him; or

3. Offers to sell, sells, displays, or permits the display for sale, of five or more motor vehicles within any 12 consecutive months.


The term "motor vehicle dealer" does not include:



1. Receivers, trustees, administrators, executors, guardians, conservators or other persons appointed by or acting under judgment or order of any court or their employees when engaged in the specific performance of their duties as employees.

2. Public officers, their deputies, assistants, or employees, while performing their official duties.

3. Persons other than business entities primarily engaged in the leasing or renting of motor vehicles to others when selling or offering such vehicles for sale at retail, disposing of motor vehicles acquired for their own use and actually so used, when the vehicles have been so acquired and used in good faith and not for the purpose of avoiding the provisions of this chapter.

4. Persons dealing solely in the sale and distribution of funeral vehicles, including motor vehicles adapted therefor; however, this exemption shall not exempt any person from the provisions of 46.2-1519, 46.2-1520 and 46.2-1548.

5. Any financial institution chartered or authorized to do business under the laws of the Commonwealth or the United States which may have received title to a motor vehicle in the normal course of its business by reason of a foreclosure, other taking, repossession, or voluntary reconveyance to that institution occurring as a result of any loan secured by a lien on the vehicle.

6. An employee of an organization arranging for the purchase or lease by the organization of vehicles for use in the organization's business.

7. Any person licensed to sell real estate who sells a manufactured home or similar vehicle in conjunction with the sale of the parcel of land on which the manufactured home or similar vehicle is located.

8. Any person who permits the operation of a motor vehicle show or permits the display of motor vehicles for sale by any motor vehicle dealer licensed under this chapter.

9. An insurance company authorized to do business in the Commonwealth that sells or disposes of vehicles under a contract with its insured in the regular course of business.

10. Any publication, broadcast, or other communications media when engaged in the business of advertising, but not otherwise arranging for the sale of vehicles owned by others.

11. Any person dealing solely in the sale or lease of vehicles designed exclusively for off-road use.

12. Any credit union authorized to do business in Virginia, provided the credit union does not receive a commission, money, or other thing of value directly from a motor vehicle dealer.

13. Any person licensed as a manufactured home dealer, broker, manufacturer, or salesperson under Chapter 4.2 ( 36-85.16 et seq.) of Title 36.

14. The State Department of Social Services or local departments of social services.




That depends on the details of the agreement the buyer has with the dealer. However, it's not hard to imagine that if the buyer acts in concert with the third party to arrage the foreign sale that the buyer may well be liable for whatever damages apply for the breach of the contract.

If you are thinking of trying to do any sort of routine sales of vehicles or selling vehicles outside the U.S, either directly or indirectly using a third party, I strongly advise you to consult an attorney first. There are a lot of things that you could do here that could cause you significant legal problems if you don't know what you are doing.



Thank you!
If I sell 5+ vehicles without a dealer's license, is that a criminal action?

#4 Guest_FindLaw_Amir_*

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Posted 16 January 2013 - 11:17 AM

You may want to read the Code of Virginia: 46.2-1508 Licenses required.

#5 Tax_Counsel

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Posted 16 January 2013 - 01:02 PM

Thank you!
If I sell 5+ vehicles without a dealer's license, is that a criminal action?


Yes, it is a class 1 misdemeanor criminal offense. See the last sentence of Virginia Code section 46.2-1508.




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