Selling a car in the UAE is relatively hassle-free, but before selling your car, make note that there are a few rules you’ll have to adhere to before, during and after the process.
We’ve compiled a list of frequently asked questions when it comes to selling a car in the UAE.
Selling a car in the UAE is relatively hassle-free, but before selling your vehicle, make note that there are a few rules you’ll have to adhere to before, during and after the process.
We’ve compiled a list of frequently asked questions when it comes to selling a car in the UAE.
Before we get started, here are three things you should note before selling;
- Do not put a piece of paper on your windshield stating the vehicle is for sale. This includes signs and advertisements inside and on your car. It is illegal in the UAE and can result in the police impounded your vehicle. Used an online platform to sell your car.
- Washing your car in the streets is illegal. A fine of AED 100 is applicable if caught.
- You cannot sell a car in the UAE with paying off any finance loans (mortgage). Technically it is possible, but it will be tough to find a buyer who will take on the loan.
Stick to the rules, and you’ll have your car sold in no time.
What needs to be sorted out before selling
If your car has been purchased via a bank loan, it will need to be paid off. The RTA (Roads and Transport Authority) needs to clear the loan from their system once notified by the bank.
Get the car test to ensure that it passes the mandatory inspection. If the vehicle fails, it can’t be sold.
Testing a vehicle costs AED 120, and the certificate is valid for 30 days.
Any fines or vehicle impoundment notices need to be cleared before selling. You can check if there are any fines on your vehicle via the app. You can also read our guide.
The following documents are required for the buyer;
- Valid insurance for the vehicle.
- Passport with residence visa. Must be valid, and is only required if it is their first registration.)
- Emirates ID.
- UAE driving license. (Issuing Emirate is not applicable)
All of the above need to be original. Copies are also required and can be acquired at the RTA.
If the buyer holds a valid visa from another Emirate, they will have to ‘export‘ the car to that Emirate. This does not apply for Emirati passport holders.
Who is allowed to sell my car?
You are allowed to sell your car of course as long as it hasn’t got any outstanding fines, loans or is waiting to be impounded.
Alternatively, you can give power of attorney to another person to act on your behalf. To do this, you’ll have to go to the courts.
Power of attorney covers all your offers, so ensure that you give power to someone you trust.
Alternatively, you can have a car showroom authorised to sell the vehicle on your behalf.
The vehicle owner must be present with their original ID while drafting the agreement. This process is also known as selling a car on a consignment basis.
As with giving power of attorney, ensure the showroom you are dealing with is a trustworthy one.
Select showrooms will advertise the car for sale and charge a little extra on top (commission) as another alternative.
Note that the original owner must be present when the vehicle is being transferred to the new owner at the RTA.
Insurance, how to transfer it
Insurance valid for seven months or longer, you can transfer the policy to the buyer. The only prerequisite for the buyer is that they must meet the requirements of the insurance company.
Not all insurance companies in the UAE offer the option of transferring the insurance policy. Check before selling.
Sellers can also opt to cancel the insurance policy outright and get a refund. The policy must have seven months or more remaining on the policy.
Getting the policy refunded is the most common option as one gets a portion of their money back.
However, selling a car with valid insurance can make your car more appealing to buyers as it has an additional incentive.
To cancel a policy, the insurance company will need proof of purchase that the car has been sold to an individual or a company. You’ll need to a copy of the buyer’s new registration of the vehicle as proof.
Loan transfer, can you do it?
While it can be done, it is extremely difficult and is not advised. RTA advises that when selling a car, any mortgages should be paid off at the earliest.
How to sell a car with a bank loan
As we mentioned earlier, it is possible to sell a car with a bank loan, albeit it is extremely hard.
In case the seller does not have the funds to clear the loan, they must go to the bank with the buyer and play the outstanding finance in full and close the account.
Before heading to the bank, prepare a sales agreement letter stating the buyer is paying the loan off. Both parties must sign the letter.
Once agreed to and the bank is satisfied, they will reach out to the RTA to approve the loan clearance on the RTA’s system. This can take up to 48 hours to be approved.
Once approved, an SMS will be sent the vehicle owners stating the vehicle has been released.
The buyer and seller can go back to the RTA and transfer vehicle ownership to the seller.
And that’s it! Do you you have any inside knowledge that we may have missed? Let us know in the comments.
We’ve compiled a list of frequently asked questions when it comes to selling a car in the UAE.
Before we get started, here are three things you should note before selling;
- Do not put a piece of paper on your windshield stating the vehicle is for sale. This includes signs and advertisements inside and on your vehicle. It is illegal in the UAE and can result in the police impounded your vehicle. Used an online platform to sell your car.
- Washing your car in the streets is illegal. A fine of AED 100 is applicable if caught.
- You cannot sell a car in the UAE with paying off any finance loans (mortgage). Technically it is possible, but it will be very hard to find a buyer who will take on the loan.
Stick to the rules and you’ll have your car sold in no time.
What needs to be sorted out before selling
If you car has been purchased via a bank loan, it will need to paid off. The RTA (Roads and Transport Authority) needs to clear the loan from their system once notified by the bank.
Get the car test to ensure that it passes the mandatory inspection. If the vehicle fails, it can’t be sold.
Testing a vehicle costs AED 120 and the certificate is valid for 30 days.
Any fines or vehicle impoundment notices need to be cleared before selling. You can check if there are any fines on your vehicle via the app. You can also read our guide.
The following documents are required for the buyer;
- Valid insurance for the vehicle.
- Passport with residence visa. Must be valid, and is only required if it is their first registration.)
- Emirates ID.
- UAE driving license. (Issuing Emirate is not applicable)
All of the above-mentioned need to be original. Copies are also required and can be acquired at the RTA.
If the buyer holds a valid visa from another Emirate, they will have to ‘export‘ the car to that Emirate. This does not apply for Emirati passport holders.
Who is allowed to sell my car?
You are allowed to sell your car of course as long as it hasn’t got any outstanding fines, loans or is waiting to be impounded.
Alternatively, you can give power of attorney to another person to act on your behalf. To do this you’ll have to go to the courts.
Power of attorney covers all your offers, so ensure that you give power to someone you trust.
Alternatively, you can have a car showroom authorised to sell the vehicle on your behalf.
The vehicle owner must be present with original ID while drafting the agreement. This process is also known as selling a car on a consignment basis.
As with giving power of attorney, ensure the showroom you are dealing with is a trustworthy one.
Select showrooms will advertise the car for sale and charge a little extra on top (commission) as another alternative.
Note that the original owner must be present when the vehicle is being transferred to the new owner at the RTA.
Insurance, how to transfer it
Insurance valid for seven months or longer, you can transfer the policy to the buyer. The only prerequisite for the buyer is that they must meet the requirements of the insurance company.
Not all insurance companies in the UAE offer the option of transferring the insurance policy. Check before selling.
Sellers can also opt to cancel the insurance policy outright and get a refund. The policy must have seven months or more remaining on the policy.
Getting the policy refunded is the most common option as one gets a portion of their money back.
However, selling a car with valid insurance can make your car more appealing to buyers as it has an additional incentive.
To cancel a policy, the insurance company will need proof of purchase that the car has been sold to an individual or a company. You’ll need to a copy of the buyer’s new registration of the car as proof.
Loan transfer, can you do it?
While it can be done, it is extremely difficult and is not advised. RTA advises that when selling a car, any mortgages should be paid off at the earliest.
How to sell a car with a bank loan
As we mentioned earlier, it is possible to sell a car with a bank loan, albeit it is extremely hard.
In case the seller does not have the funds to clear the loan, they must go to the bank with the buyer and play the outstanding finance in full and close the account.
Before heading to the bank, prepare a sales agreement letter stating the buyer is paying the loan off. Both parties must sign the letter.
Once agreed to and the bank is satisfied, they will reach out to the RTA to approve the loan clearance on the RTA’s system. This can take up to 48 hours to be approved.
Once approved, an SMS will be sent the vehicle owners stating the vehicle has been released.
The buyer and seller can go back to the RTA and transfer vehicle ownership to the seller.
And that’s it! Do you you have any inside knowledge that we may have missed? Let us know in the comments.
