Surprise! I Got You a Car for Christmas!

Could there be a bigger holiday surprise than a brand-new car?

Giving a vehicle to someone for Christmas is not as simple buying an iPad, but people do give automobiles as presents, and most people love to receive them.

If you’re surprising your spouse or child with a new car, the process should be straightforward. In most cases you can just purchase the vehicle and register it in your name or in both your names. Likewise, you can arrange for financing and insurance either in your own name or together with theirs as co-owners. Present the car to the lucky loved one and you’re done!

If you’re thinking of buying a car for someone you won’t share ownership with, such as a parent, significant other, sibling, friend, employee, et al., the process is more complicated but still doable.

This post is by no means a comprehensive guide to surprising someone with a new car. But here are a few important tips and ideas to keep in mind as you consider buying someone the Ultimate Christmas Present:

1. Make sure you know what you’re getting yourself and your giftee into.

Owning a car is a BIG deal.

  • Are you absolutely sure the person you’re buying it for wants to own a car?
  • Is the person 100% willing and able to handle the responsibilities of car ownership?

2. Choose the right car.

The last thing you want to do is buy a vehicle for someone only to find out you’ve bought the wrong one.

  • What kind of car does the person want and need?  What type and size of car can the person safely drive?
  • If you’re not sure what vehicle to buy, ask the person what they like during a casual conversation, or ask someone you both know to find out for you.

3. Compare ownership costs and taxes.

Ownership costs vary widely depending on the exact model. If you’re not sure the person can afford to keep the car running, you may need to consider other options, such as paying these expenses yourself.

Vehicle Ownership Costs:

  • Maintenance, such as routine services, repairs, and replacement parts.
  • Insurance. Check with your insurer to compare the cost of insuring vehicles you are considering.
  • Taxes. Sales tax and gift taxes will need to be paid before a license plate will be issued for the car. You may be able to give the car as a donation without either of you having to pay taxes. Check with your state’s DMV for obligations associated with gifting a vehicle.
  • Annual registration and title fees. These vary by state.

4. Tell the dealer!

Especially if you’re buying a car for someone who’s not expecting it, let the dealer help you.

  • Find a salesperson who has done a surprise car deal before so you benefit from their experience. Most dealers will be thrilled to help you carry out your surprise. Some dealerships will even hold the car until the big day, usually for a small deposit.
  • Most importantly, the dealer can help ensure you complete the proper paperwork before the surprise, including registration, titling, and financing.

5. Registration and Title: Decide who's car it is.

  • DMV papers must be signed by the new owner to accept legal liability for the car. The dealer can help you determine which names need to be listed on the registration and title.
  • If you want to register the car in the recipient’s name, the dealer can draft the necessary papers for the new owner to sign on receipt of the vehicle. The dealer may require a copy of the recipient’s driver license to facilitate completion of the paperwork ahead of time.

6. Financing: Decide how you'll pay for the car.

  • If you’re paying cash, you’ll simply pay for the car and register the vehicle in whoever’s name you want.
  • If you need to finance the vehicle, you must register the car in either your name solely or as a co-owner with the recipient. In other words, you can’t take out a car loan in one name if the vehicle title is in someone else’s name. Additionally, you cannot take out a loan for another person, unless you are a co-signer. Any ideas you have about signing up your giftee as a co-signer for a loan need careful consideration.
  • Consider leasing the car. It costs a lot less to give a lease rather than an entire car as a gift. You may qualify for a lease deal with a low monthly payment, after you pay a lease drive-off fee, which is a deposit that includes the first month’s payment. The drive-off fee is different from a down payment, which is nonrefundable and reduces your monthly payment amount. A down payment is usually required, depending on the lease deal you negotiate. Ask your dealer for details on available lease deals and requirements.

7. Insurance: Decide how the car will be insured.

It’s imperative that the vehicle is adequately insured and that future premiums are paid by the responsible party.

  • Depending on who the giftee is, you may want to put your name on the policy either as the sole insured party or as an additional insured party who shares liability.
  • Automobile insurance laws vary widely by state, so consult an agent or your state’s Department of Insurance well ahead of purchasing the vehicle.

8. Order far in advance, if needed.

  • If you’re ordering a car rather than buying something on the dealer’s lot, do it way in advance. Deliveries can be delayed, so allow yourself a buffer to make sure your surprise goes as planned.

With some money and a little planning, you can give the ultimate holiday present. Anything that can improve someone’s life, last for years, and never be forgotten is a profoundly generous gift almost anyone would cherish. Good luck if you decide to go for it. If, as the saying goes, giving is receiving, you’re sure to give and receive an unforgettably gratifying Christmas.

Contact your local dealer for further guidance based on state and local laws and requirements.

To get the best price on a new car for a loved one or for yourself, give Carjojo a try. Carjojo will find the best deal in your area for the exact vehicle you want, saving you money, time, and stress. We’ll make sure you know about all the the rebates and incentives you may be eligible for too!

Hat tip and thanks to the following excellent references for help in writing this post: