Virginia Dealer Manual - Virginia Department of Motor Vehicles

Virginia Dealer’s Manual
October 1, 2009
CHAPTER 7: DEALER FUNCTIONS & DUTIES
7.1 DLR 700-ISSUING TEMPORARY CERTIFICATES
7.1.1 When to Issue a Temporary Certificate (DSD-5)
NOTE: ONLY applies to T&M, Trailer and Motorcycle Dealers.
When you purpose or accept a trade for a used vehicle, you must obtain a valid,
transferable title from the previous owner. If you wish to sell a vehicle and the
assignment of title or certificate of origin to you from the previous owner has been
delayed for some reason, (e.g., the necessity to satisfy a lien, obtain a duplicate title, or
perform any other paperwork,) you may undertake sale negotiations with a new
purchaser, transfer possession of the vehicle and collect payments, provided you issue the
purchaser a DSD-5, “Temporary Certificate”. This form serves as proof that the
purchaser is legally entitled to have possession of the vehicle in cases when the title is not
available for assignment to them.
7.1.2 Restrictions on the Use of a Temporary Certificate
There are several legal restrictions you must observe when you issue a temporary
certificate (VSA-01):
a. Only DMV licensed dealers may issue a temporary certificate; the form may not
be used by the general public.
b. If your customer wants to drive the vehicle on a public road, you may issue them
temporary tags for use on the vehicle. (See DLR 705 for information on how to
issue temporary tags.)
c. A temporary certificate is valid for only 30 days.
d. If the purchaser does not have a valid assigned title in his possession by the end of
the 30-day period, he has the right to cancel all sale negotiations, return the
vehicle to you, and obtain a full refund of any payments they made towards the
purchase price of the vehicle less any damages to the vehicle and less a reasonable
amount for use, not to exceed one-half the amount allowed per mile by the
Internal Revenue Service.
e. If the purchaser chooses to retain the vehicle, a second temporary certificate may
be issued, provided that all fees and taxes have been paid to DMV (when the
vehicle is to be titled and registered in Virginia), and DMV has approved such
issuance. If the dealer does not produce the certificate of title or certificate of
origin before the second temporary certificate expires, the purchaser’s ownership
may terminate as outlined in paragraphs d and f.
f. If the dealer does not produce the Certificate of Title/Origin prior to the
termination, the purchaser’s ownership of the vehicle may terminate.
1) The purchaser may not be refunded any portion of DMV UMV fee, if he was
required to pay one when he took possession of the vehicle.
2) The purchaser is required to pay you the dealer, for any damages to the
vehicle which were incurred while in his possession.
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