Buying a vehicle in Hawaii involves navigating state-specific regulations and understanding the unique aspects of the local market. Hawaii's distinct laws and requirements can impact the purchasing process, making it essential for buyers to be well-informed.
State-specific regulations govern various aspects of vehicle purchase and ownership, from transfer of ownership to safety inspections and emissions testing. The State of Hawaii's laws, codified under the Hawaii Revised Statutes, provide detailed guidelines that buyers must follow.
The Department of Commerce & Consumer Affairs (DCCA) is the overall overseer for all the counties. Each county has its own division that handles various aspects of vehicle ownership.
The Department of Finance (DF) in the counties of Kauai, Hawai'i, and Maui oversees vehicle registration and related matters. On the other hand, the Department of Customer Services (DCS)' Division of Motor Vehicle Licensing (DMVL) manages these responsibilities in the County of Honolulu.
Each department provides resources and support to help buyers understand and comply with local regulations. Also, Hawaii's unique geographic and climatic conditions influence the vehicle market.
What Is the Process for Buying a Car in Hawaii?
Buying a car in Hawaii involves several key steps to ensure a smooth and legal transaction. Potential buyers must research and choose a suitable vehicle, keeping in mind the islands' unique geographical and environmental factors.
After selecting a car, it is necessary to navigate the state's specific registration and titling requirements. Understanding local laws and regulations is crucial for a hassle-free purchase. The process also includes considerations for inspections, taxes, and fees unique to Hawaii.
Buying a Vehicle from a Private Seller
When buying a vehicle from a private seller, buyers must understand the intricacies of the process. It's quite daunting at first, but research and asking the right people can make a difference. Thus, buyers must take responsibility for calling the relevant department and checking the website for more information.
Title Verification
Title verification enables buyers to check the legitimacy of the certificate. In the County of Honolulu, verification is done by sending a request through mail.
Transfer of Ownership
The new owners must print legibly and affix their signatures on the appropriate sections on the back side of the title.
If joint ownership is involved in the registration, both owners must sign. A letter of authorization is required if a business will purchase and register a vehicle.
Buyers must have a release document or a satisfaction letter for titles with liens. They can also provide an original contract, canceled or stamped, that the loan is already paid in full.
To complete the transfer, the new owners must bring the certificate of vehicle title and the other required documents within 30 days. Otherwise, buyers will pay a fine.
The county of Honolulu has an online appointment for motor vehicle transfer since transfers are not an express service.
Bill of Sale and Odometer Disclosure
A bill of sale is necessary to document the transaction. This document should include the purchase price, vehicle identification number (VIN), make, model, and year of the vehicle. Both the buyer and the seller must sign this document, which must also be notarized.
Parties involved must note that templates for this bill of sale document may vary from one county to another.
Furthermore, odometer disclosure is important and must be filled properly. It should reflect the actual mileage of the vehicle.
Safety Inspection Certificate
Hawaii's climate, with its salty air and high humidity, can accelerate vehicle wear and tear. Potential buyers should inspect vehicles for signs of rust and corrosion, especially in older models.
Statewide, all vehicles must have an annual safety inspection certificate. Thus, before buying, buyers must check if the vehicle has a current and valid inspection certificate. Only accredited inspection stations can issue these certificates.
The state has a list of vehicle components that need inspection. Buyers might want to check this list before inspecting the vehicle. Note that even if the inspection certificate is expired, new owners can still register their newly acquired vehicle.
Vehicle Registration
All vehicles must be registered with the county where they are being used or driven. Thus, new owners of vehicles must gather all the legal documents, such as a notarized bill of sale, certificate of inspection issued at the applicable county, shipping documents or bill of lading, and vehicle title.
The application form differs for every county.
- form CS-L(MVR)1 - Honolulu
- Registration of Motor Vehicle - Hawai'i
The last-issued Certificate of Registration is a crucial piece of documentation. It verifies the vehicle's previous registration status and ownership history.
Active duty military service members have specific document options. They may submit a Non-Resident Certificate form CS-L(MVR)50 or a Resident Certificate form CS-L(MVR)50A. These forms, available from military units or personnel offices, accommodate the unique circumstances of service members stationed in Hawaii.
Shipping documents are vital, particularly for vehicles imported from outside the state. These documents prove the vehicle's legal entry into Hawaii and may include bills of lading or customs forms. The Hawaii Revised Statutes §286-41 outlines the requirements for vehicle registration, including the necessity of these shipping documents for out-of-state vehicles.
Buyers must also present a valid Hawaii driver's license or state identification card and insurance card when registering their vehicle.
Buying from a Dealership in Hawaii
Dealerships typically handle the title transfer process. They ensure that the new registered owners print and sign their names on the appropriate lines on the certificate of title. If there is a lien on the vehicle, the new lienholder's information must be accurately recorded.
While buying from a dealership seems more convenient and faster, buyers must still be cautious. They must do some checking to avoid being scammed by unscrupulous people who pose as legitimate dealers even without proper licenses. Moreover, they have to understand the basic requirements a dealer must do and provide for every transaction to become valid.
Dealer's License Check
Before buying a car from a dealer, the first thing a buyer does is to check for a dealership license. Every county has unique ways to verify this license. The DCCA-RICO provides updated lists of authorized and licensed motor vehicle dealers and salespeople. For dealers with a lot, buyers might want to check complaints against these dealers online to avoid surprises.
Buyer's Guide
The Federal Trade Commission (FTC) mandates that car dealers display a Buyer's Guide on all used vehicles for sale. This requirement falls under the FTC's Used Car Rule, codified in 16 CFR Part 455.
The Buyer's Guide provides critical information, including whether the vehicle is sold "as is" or has a warranty. Dealers must list the major mechanical and electrical systems on the guide and indicate if any problems were discovered during an inspection.
In Hawaii, adherence to this rule is strictly enforced. The Buyer's Guide must be visible on the vehicle's window, ensuring potential buyers have access to all pertinent details before purchasing.
This guide also includes advice on how to get an independent inspection and a reminder that spoken promises are difficult to enforce, emphasizing the importance of obtaining all promises in writing. By following these federal requirements, Hawaii helps protect consumers from fraud and ensures transparency in the vehicle purchasing process.
Warranties
Understanding warranties is crucial when purchasing a vehicle from a dealership in Hawaii. Warranties provide protection, and buyers need to know the types and terms available.
Moreover, Hawaii's geographic isolation means that buyers should also consider the availability of warranty service providers. Some warranties may require repairs to be performed by specific dealerships or service centers, which can be a concern on the islands.
Additionally, the decision should consider the cost and logistics of shipping parts and vehicles for warranty service.
Factory Warranties
Some used cars may still be under factory warranty from the vehicle's manufacturer. Most new cars come with at least a 3-year/36,000-mile bumper-to-bumper warranty.
For example, buying a year-old car with only 15,000 miles on it means the warranty would have, at minimum, two years and 21,000 miles remaining.
Buyers should understand what is covered by the warranty, the length of coverage, deductible amounts, and the requirements for transferring the warranty. This is particularly important for extended warranties or long-term powertrain warranties.
"As Is" Vehicles
Vehicles sold "as is" do not come with any warranty coverage. Buyers are responsible for any repairs needed after the purchase. Hawaii buyers should be particularly cautious with "as is" vehicles due to the state's unique climate, which can cause accelerated wear and tear. Thorough inspections for rust and corrosion are advisable.
Certified Pre-Owned Vehicles
The manufacturer inspects factory-certified pre-owned vehicles, which come with a warranty from the manufacturer. These warranties offer significant peace of mind, often including additional coverage beyond the original factory warranty.
Dealer-certified pre-owned cars are inspected and certified by the dealership. These vehicles may not come with a manufacturer warranty, and the terms of any dealer-provided warranty can vary. Buyers should ask for detailed information about what is covered and any limitations.
The Lemon Law in Hawaii
Hawaii's State Certified Arbitration Program (SCAP) provides protection for consumers who purchase or lease new vehicles with persistent defects. The law covers new cars, including motorcycles and demonstrator models, used primarily for personal, family, or household purposes.
Vehicles purchased, leased, or initially registered in Hawaii fall under this law's umbrella. However, Hawaii's law excludes mopeds, motor scooters, and vehicles over 10,000 pounds gross vehicle weight rating. The law also extends to certain business-owned vehicles used for personal purposes, provided the business purchases or leases no more than one car per year.
Consumers may seek arbitration if their vehicle exhibits a nonconformity covered by the manufacturer's express warranty that substantially impairs its use, market value, or safety. This nonconformity must not result from accidents, abuse, neglect, or unauthorized alterations.
The Lemon Law Rights period extends two years from the original delivery date or the first 24,000 miles of operation, whichever occurs first. During this period, owners must attempt repairs through the manufacturer's authorized dealer and notify the manufacturer in writing about the nonconformity.
Three presumptions can strengthen a consumer's case:
- The "three times" presumption applies when a vehicle undergoes repair for the same issue at least three times, but the problem persists.
- The one-time serious nonconformity" presumption involves a single repair attempt for a defect likely to cause death or serious bodily injury if the vehicle is driven.
- The "30 days" presumption applies when repair attempts for one or more nonconformities total 30 or more business days.
Consumers seeking arbitration must file a request within one year after the Lemon Law Rights Period expires. The process requires a $50 filing fee, refundable if the arbitrator rules in the consumer's favor.
Consumers initiating the arbitration process should continue making payments on financed or leased vehicles to avoid repossession. After submitting a demand for arbitration, they must allow the manufacturer to inspect the vehicle. Detailed records of all interactions with the manufacturer and dealer strengthen the consumer's case.
While most consumers present their own cases during arbitration, they may choose to hire an attorney. Some cases might benefit from expert witnesses, such as mechanics, to testify about the nature and severity of the vehicle's defects.
What Are the Fees for Buying a Car in Hawaii?
Hawaii's isolated geographic location presents unique challenges and considerations for vehicle buyers. Shipping costs for out-of-state vehicles can be significant, and buyers should factor this into their budget.
Buyers of vehicles in Hawaii face several fees during the purchase and registration process. Hawaii has four counties and their fees and taxes may vary. Thus, buyers must be familiar with them. If not, they can contact their county offices for the updated schedule of fees and taxes.
GET/Use Tax
Vehicle purchases are either subject to general excise tax (GET) or use tax at 4%. Buyers in Hawaii pay use tax on purchases from out-of-state sellers that are not subject to Hawaii's General Excise Tax (GET). This tax applies when importing items for use in Hawaii.
The buyer becomes responsible for the use tax when dealing with these unlicensed sellers. Hawaii's Department of Taxation enforces this tax to level the playing field between in-state and out-of-state purchases.
The use tax rate matches the GET rate, currently 4% for most items. Buyers should factor in this additional cost when purchasing vehicles from sellers outside Hawaii.
In addition to this tax, the state imposes annual taxes based on vehicle weight, with rates varying depending on the vehicle's classification and weight range. For instance, vehicles up to 4,000 pounds incur a state weight tax of 1.75 cents per pound, while those over 10,001 pounds pay a flat rate of $300.
Registration Fees
Registration fees include a $45 state fee and a $12 county fee. The county also levies a weight tax, charging 1.25 cents per pound for passenger vehicles and trucks up to 6,500 pounds, with a minimum of $12. Freight vehicles and trucks exceeding 6,500 pounds pay 2.5 cents per pound.
Additional charges encompass a $12 vehicle disposal fee, a $1 beautification fee, and a $0.50 emblem renewal fee.
Honolulu has an online service to compute registration fees.
Buyers should factor in potential costs for duplicate documents or replacements. A duplicate title or registration costs $5 each while replacing an emblem costs $0.50, and a new plate costs $5.
Transfer Fees
When transferring ownership, buyers pay a transfer fee plus the annual fee if the vehicle hasn't been licensed for the current year or within 45 days of its staggered expiration month. Each count has different transfer fees as follows:
- Hawai'i - $5
- Maui - $20
- Honolulu - $10
- Kauai - $10
What Are the Insurance Requirements for Vehicles in Hawaii?
Hawaii mandates specific insurance requirements for all vehicles operated in the state. Drivers must maintain continuous motor vehicle insurance coverage throughout the registration period and carry a valid Hawaii motor vehicle insurance identification card in their vehicle at all times.
The state follows a "no-fault" insurance system, which affects how claims are handled. Under the system, the insurance company shoulders their own policyholder's injuries and those of their passengers up to the personal injury protection (PIP) limit, regardless of who is at fault in the accident.
However, the at-fault driver remains responsible for vehicle and property damage.
Hawaii law sets minimum coverage requirements for motor vehicle insurance policies:
- PIP: $10,000 per person
- Bodily Injury Liability: $20,000 per person / $40,000 per accident
- Property Damage Insurance: $10,000 per occurrence
PIP coverage pays for medical and rehabilitative costs, while bodily injury and property damage insurance cover expenses when the policyholder is at fault in an accident.
Drivers may opt for additional coverage, such as collision, uninsured and underinsured motorist coverage, and death and funeral benefits. Vehicle owners should consult with their insurance agent or company to determine the most suitable coverage for their needs and circumstances.
This consultation helps ensure compliance with state laws while providing appropriate protection tailored to the driver's situation.
Failure to comply with Hawaii's insurance requirements carries significant consequences. Drivers caught operating a vehicle without the required insurance identification card face fines and potential ticketing.
Those owners without proper insurance must surrender their vehicle's registration certificate and license plates to the county director of finance, effectively prohibiting them from driving the vehicle.
Can a Non-Resident Buy a Car in Hawaii?
Non-residents can purchase and register a vehicle in Hawaii. They must submit the same documents that residents need, including proof of identity, vehicle title, and registration forms. Additionally, non-residents must provide documents that establish their connection to the state, such as a driver's license issued in Hawaii or proof of residency, which might include utility bills or a rental agreement.
Non-residents can use their out-of-state plates but must ensure their vehicle complies with Hawaii's safety and emission standards. However, those considering shipping the car out of Hawaii should note that shipping costs can be high, potentially impacting the overall affordability of the vehicle purchase.
Newcomers planning to stay in Hawaii for an extended period must obtain the necessary documents to prove residency. This process typically involves transferring their out-of-state driver's license to a Hawaiian one and updating their vehicle registration to reflect their new residency status.