Step 1. Indemnity Form for Test Drive
Before going for the test drive, the seller will need to get the indemnity form signed by the interested party who wishes to test drive the car.
This form indemnifies the seller from any liabilities should there be damage to the vehicle, as well as death or personal injury that is sustained by the buyer during the test drive.
Step 2. Signing the Sales Agreement Form
Once the price has been agreed upon, both the buyer and seller will proceed to endorse the sales agreement form.
The buyer will have to place a deposit to confirm the purchase.
Step 3. Issuance of Invoice
After the deposit has been placed, the seller should issue an invoice for the deposit collected. This invoice serves as a confirmation for the receipt of the deposit given by the buyer to the seller.
Step 4. Source for Loan Facilities & Insurance
Unless the buyer is paying cash in-full for the car, he/she will need to source for any loan facilities on his own accord. Once approval for loan has been given, the buyer can then notify the seller. The seller can then demand to see the documents as proof of the approval for the loan.
The buyer is expected to source for, and activate a motor insurance under his name, which is necessary in order to do the transfer of ownership of the vehicle at a later stage.
Step 5. Full Settlement of Existing Loan
If the vehicle is still under financing, the seller is to check on the outstanding loan amount and to make the necessary payment to the finance company before the ownership of the vehicle can be transferred to the buyer.
Step 6. Inspection and Transfer of Ownership
Before proceeding with the transfer of ownership, the car will need to undergo an inspection as stipulated by Puspakom to safeguard potential buyers of used vehicles in purchasing scrapped cars or more popularly known as ‘kereta potong’. Upon inspection, a certificated of approval is issued when the test has passed the criteria of Puspakom.
The ownership of the vehicle is now ready to be transferred.
A transfer fee is to be made payable to the Jabatan Pengangkutan Jalanraya (JPJ). This is to be borne by the buyer and it is on top of the agreed selling price for the vehicle.
The JPJ K3 form is the official form that needs to be submitted to the JPJ. It needs to be endorsed by both the buyer and the seller. The buyer is to present a valid motor insurance certificate and his original IC to effect the transfer. The seller also has to produce his original IC. If the car is being financed, then an endorsement letter called the ‘e-daftar’ will be produced by the financing institution and must be shown during the transfer of ownership.
The buyer is to ensure that the road tax is still valid when the ownership of the vehicle is to be transferred.
Step 7. Balance Payment to Seller
After the ownership of the vehicle has been transferred to the buyer, the balance payment will be issued by the finance company to the seller.
Alternatively, a cash buyer will pay the remaining balance payment in full cash to the seller.
Seller should then issue an invoice for the balance payment collected. The invoice serves as a confirmation for the receipt of the balance payment.
Step 8. Signing the Hand-Over Form
Once the ownership transfer has been done, the vehicle is now ready to be handed over to the buyer.
This hand-over form specifies the official hand-over of the vehicle. The buyer now bears the responsibility for any fines, summons or any claims relating to the vehicle from the date and time of hand-over.