Buying a Car Based on My Resident Status in the United States

In the United States, driving is a central part of life in most cities. Whether for work or leisure, owning a car and having a license is a factor in life. The process of buying and owning a car can seem complex between each state’s many steps and variances. 

In this guide, we will give a laydown of the basic rules and laws behind getting a license and owning a car in the USA.  

Do I need a Driver’s License to buy a car?

No, you do not need a driver’s license to purchase a car. It is entirely legal for you to buy a car without a license as there are no laws against it. People tend to buy cars without a driving license for the

purposes of gifting, collecting, or as a purchase for their employees.

If you buy the car for personal use, you will likely run into issues with the car’s registration and insurance due to the lack of your driving license.

Car Insurance

When it comes to car insurance, insurers will hesitate to give you coverage and, in many cases, even outright deny you any coverage. Some insurance companies may give the option of getting the coverage you want by adding a co-owner to the vehicle who would have a driving license and can apply for the insurance. In addition to that, you can add someone who has a driving license in your family as the primary driver.  

State Registration 

A car must be registered to run on the roads, and the registration can only be done in the name of a legal owner who has a driving license. You can possibly complete the registration by again adding a co-owner with a valid driving license and registering it in their name. If you choose this route, it will imply that your car ownership will become partial. An ideal person to choose for the co-ownership should be a close friend or family member who you trust.

Auto Financing

You are also likely to run into auto-financing issues without a driver’s license. These issues will stem from you’re not having insurance. Before financing, lenders will always ask for the specifics of an insurance policy. An alternative is taking a loan in the name of a person with a valid license and whose name the insurance is under.

Remember that even with some options to secure insurance and register a vehicle, it is illegal to drive without a license.

What is the process for obtaining a Driver’s license?

The driving license is issued by the state where you live, and it is governed by state laws. Make sure to check the specific requirements that your state needs and carefully overcome all the steps.

The process of getting the license will be much easier if you are a legally residing resident. If you have a social security number, then the process will be trouble-free, and you will be getting a driver’s license that is classified as a REAL ID Here. REAL ID with the appropriate “star” will be the new acceptable state form of I.D. for domestic flights starting May 3, 2023.

To obtain this REAL ID, you will need proof of specific documentation, including lawful presence or citizenship. For all items needed to obtain a REAL ID, you will need to verify with your local state DMV here.

If you are an undocumented immigrant, the opportunities and path can be more challenging. Still, pending the state you live in, you may have the ability to get a driver’s license for purposes of operating a car but will not be a REAL ID. We will address more below.

Things to Know based on my Current Residential Status

Permanent Resident/ Green Card

As a permanent resident or a green card holder of the United States, the process of getting a license will be very smooth for you, given the fact you have Social Security Number (SSN). 

You will simply need to visit your local DMV office to apply for a driver’s license. In most cases, the application will need the following documents: Your SSN, Passport or Green Card and a piece of registered mail with your name and current address. It is essential that you contact your local DMV and double-check this information to ensure you have all you need and potentially make an appointment.

The only problem that you might face would be regarding financing. If you have not established credit due to your length of stay in the country, you will have to look at alternate methods of financing. In this guide on building credit, we have mentioned the different options of financing that you have in detail.

DACA- Deferred Action for Childhood Arrivals

DACA, or Deferred Action for Childhood Arrivals, is a program that protects young individuals who came to the United States illegally as minors and are now known as “DREAMers.” Since 2012, DACA has granted qualified young people a temporary respite from deportation and eliminated obstacles to pursuing opportunities and earning a livelihood. Even though it is not a long-term solution, DACA has provided fundamental freedoms to over 800,000 young people Here, including work permits, driver’s licenses, lower-cost higher education, and professional licenses in certain states.

As mentioned, one of the benefits of DACA is a driver’s license, which is available to eligible DACA and undocumented citizens. If you want to get a driver’s license through DACA, it is important to ensure that you have all documentation taken care of, including your SSN Here. You can obtain an SSN if you qualify through Enumeration Beyond Entry (EBE) Here, a program from the U.S. Citizenship and Immigration Services (USCIS) and the Social Security Administration (SSA).

Work Visa

If you are here in the United States on a work visa for a limited time, you should consider the time and decide on the best route for buying a car and may even consider a short-term lease. Also, depending on your employer, they may offer to provide a vehicle to make the documentation process easier for you.

Some instances where buying a car may become necessary for you can be:

• You live in a remote town with a lack of transportation facilities.
• You live in a suburb, and buying a car may be necessary to be independent.
• If you are a traveler and plan to drive across the country during the duration of your visa.

If you are here on an H-1B Here or L visa Here, you can purchase a vehicle but should consider a couple of items:

• If financing, you will need to provide proof of how long you will be residing, and loans will not extend past that time in the USA. If your visa only allows for 1-2 years, that may cause you to consider loan options. The average auto loan term in the USA is 60-72 months.
• Also, consider that you will enter with no credit and may want to use other transportation needs to establish your credit before purchasing to get a better rate.

Visitor Visa

If you are here in the USA on a visitor visa and looking to buy a car, you will need to look at certain factors before deciding. If you are visiting for a longer period, for example, up to the max of 180 days and are planning to do a lot of driving, you may consider buying instead of renting.

It is often recommended to rent and avoid the hassle of making an outright purchase. You can easily drive in all states with a valid driver’s license from your home country plus your passport for up to 180 days. 

If you go ahead with the plans to buy, you will face many challenges. These issues will come during the purchase, registration, and insurance process and may not be worth the hassle and potential financial impact. These processes that are part of the purchase will need a U.S. Driver’s License which is hard to get on a visitor visa. A few states like Texas do have a process to get a temporary driver’s license. Also, keep in mind that all these processes will need a United States address for registration needs.

Undocumented or Illegal Residents of the United States

For individuals residing in the USA as undocumented, the path to buying and driving legally can vary largely in each state. While purchasing a car without a driver’s license is possible, we always encourage following laws when operating the vehicle, including a valid driver’s license and insurance. 

Depending on the state you reside in, you may have opportunities to obtain a driver’s license as undocumented. Currently, 16 states allow undocumented residents to obtain an I.D. for driving needs only, which makes it legal to operate your vehicle and easier to get legally required insurance. It is important to note that these I.D.s are not a REAL ID and are not valid for domestic flying or voting.

When it comes to financing the purchase, lenders will ask for your social security number when you purchase a vehicle so they can verify your identity and run a credit report. As an undocumented citizen, you may run into difficulties providing the needed information. However, Individual Taxpayer Identification Number (ITIN) may be accepted instead of a social security number by certain vehicle companies or lenders.

When considering a car purchase as an immigrant, the most crucial thing should be looking at your rights and privileges based on your resident status. You should look up the rights based on your state and weigh the pros and cons of buying a car.

Please ensure that you follow all the laws diligently while buying a car. There are many workarounds to getting a car if you are undocumented or cannot obtain a driver’s license, but you should pursue them by following the law. 

If you are ready and have decided, the next step should be planning your budget to determine what car you can afford.