What do you do after you've sold your car?

The sale of a used car can be a protracted process. When do you say a sale is concluded? Is it the hand-shake? The hand-over of cash? The signed transfer notice? Or the new owner taking the keys from you and driving off into the sunset?

Making the sale can be arduous, but don't let your guard down once you think it's all done and dusted.

Firstly, be certain that the buyer's money is paid in full before you relinquish the keys to the car. Cash is great, but a bank cheque is also a safe way to ensure you receive payment for the car. There are other safe means of payment too, some of them online.

Secondly, fill out all the transfer details for the car's registration from the buyer's licence. Don't trust to the buyer that he or she will inform the registration authority that they're the new owner of the vehicle.

This is vital... don't trust the buyer. Send off the transfer paperwork yourself, because if the buyer begins incurring fines and penalties – and you're still the registered owner of the vehicle – the onus is on you. Insurers, toll road authorities, municipalities (for parking offences), police, the sheriff, uncle Tom Cobley and all will be on your doorstep looking for payment if you're still the registered owner of the car.

For more information, go to this web page, where you can find the link for your state registration authority.

Thirdly, cancel the insurance for the car or at least inform the insurer that the vehicle has been disposed (sold to someone else) and the cover should be held in abeyance from the date of disposal, pending transfer to your next car. Your insurer may prefer to cancel the policy and issue a new one for your next car rather than just transfer the policy, but whatever the case, it's imperative that you wipe your hands of any potential claims against you by a third party involved in a crash with your car after it has been sold.

If the insurance company should indemnify the new owner of the vehicle on your policy, you will still be required to pay the excess for any claim – and the excess could be $600 or more. Can you imagine convincing the new owner they should pay your excess? And while you're receiving increasingly forthright letters of demand from the third-party's insurer?

Best not to leave yourself in that situation...

Finally, remember to cancel or transfer any standing contract or account associated with the car you've just sold. This includes your toll road account, your roadside assistance and any other sort of arrangement (such as secure parking perhaps) that draws on the vehicle's registration for billing.

After you've completed those tasks – which aren't demanding – then and only then you're entitled to crack open the champers.