You might see a great deal on a car that won't last long or be in the middle of a car purchase when your driver's license gets suspended. Can you buy a car with a suspended license? The good news is that you don't always need a valid driver's license to purchase a car, explains Experian. The problem is that you won't be able to drive it once you purchase it.
In addition, your state, a dealership, a lender or an insurance company might not work with you while your license is suspended depending on the reason for the suspension. Reviewing the circumstances under which you can buy a vehicle with a suspended license will help you get your paperwork in order before you start the process of buying.
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Licenses and Vehicle Purchases
A car purchase is a separate issue from being allowed to drive. You don't even need a license to buy a car because nondrivers might be purchasing a car for someone else (like a child) or might be buying a classic car as an investment. The quickest way to find out if you can legally purchase a car is to check with your state's department of motor vehicles. It will tell you whether or not you need a license and if so, whether you can purchase a vehicle with a suspended license.
In some cases, depending on why the license was suspended, you might be able to get a hardship or restricted license that allows you to use a vehicle for limited purposes, such as driving to and from work or school, according to DMV.org.
Who Are the Other Players?
Just because you can legally buy a car with a suspended license in your state doesn't mean a dealership, financing company or insurance company will work with you. A dealership will be most likely to sell you a vehicle with a suspended license as long as it is not on the hook for the loan.
You must have vehicle insurance to get a loan to purchase a car. If an insurance company won't extend you a policy, no lender will write you a loan. What happens if the car is damaged or stolen while in your possession and you don't have insurance?
Check with your insurance company to see if it will write a policy on a new vehicle purchase while your driver's license is suspended. You can also find out from a lender before you let it do a hard pull of your credit report and start the paperwork for a loan if you can qualify with a suspended license.
Reason for the Suspension
Did your license get suspended because you forgot about a parking ticket or unpaid toll incident that occurred two years ago? Or was your license suspended because you had multiple tickets for driving under the influence, speeding or reckless driving? That will affect whether or not you can get insurance or a loan for the vehicle you want to purchase.
Co-Signing a Loan
Technically, you're not purchasing the vehicle if you are co-signing a loan and the title will be in the other party's name. In this case, a lender and insurer will be more likely to work with you. This is because as a co-signer, you're agreeing to make the payments if the other party can't or won't make payments. You might need to agree to carry insurance on the vehicle or agree to a forced-place insurance policy required by a lender.