In a consignment sale the owner keeps title while the dealer markets and sells the car for an agreed fee or share. The agreement should state the minimum price, the dealer's fee, who pays reconditioning and advertising costs, the term, insurance responsibility and what happens if it does not sell.
What it should cover
- The owner, the dealer and the vehicle, with VIN and odometer.
- Minimum acceptable price and who may agree changes.
- The dealer's fee or percentage, and when it is paid.
- Who pays for reconditioning, storage and advertising.
- Term of the agreement and how it can end.
- Insurance, risk of loss and keys.
- Payoff of any lien.
Why get it in writing
Consignment mixes your inventory with someone else's property. A written agreement protects the owner and you, and keeps your records straight at tax time.
In Dealer Garage
A consignment agreement is part of the form set. See dealer paperwork forms.
Questions for the owner
- What is the lowest price you will accept?
- Does the car have a lien, and who holds it?
- Who pays for repairs if the car needs them to sell?
- How long can I keep the car on the lot?
- What happens if you change your mind?
Questions people ask
Does a consignment car show in my inventory?
Keep it clearly marked so you do not treat it as owned stock.
This is general information, not legal advice. Rules differ by state, province and territory and change over time; confirm what applies to you with your regulator or a qualified adviser.
Try Dealer Garage
Dealer Garage is installable dealer management software for independent used-car dealers in the US and Canada: inventory, leads, deals, dealer paperwork, Facebook Marketplace posting and email campaigns, with records stored on the dealership's own computer..