Buying a car in Denver vs in Seattle (Colorado Springs, Fort Collins: car rental, sales)

[AmFest]

Hi all,

I will be moving from Seattle to Denver in about 2 weeks, and as of now I do not have a car but I plan to have one in Denver. I am debating over where to buy a car.

Scenario 1, I buy a car in Seattle and drive there with 2 friends.
Scenario 2, I rent a car to drive to Denver with the friends and buy a car there.

In which scenario do you think I would come out ahead, financially and everything else?

[Mike from back east]

IIRC what I've read on these forums the past several years, if you buy a car in another state and bring it here, you'll have to pay tax on it when you register it here, so why pay to register in WA and in CO. Just buy one when you get here. The older the car the less tax to register; the newer the car the more tax one pays.

[AmFest]

Don't I get a tax credit if I pay sales tax in WA? I'm hoping CO and WA don't both charge the full amount of sales tax, but really I have no clue. In any event, I know that CO has lower sales tax, but I don't know if car prices are lower in CO as well. If I get a car from WA and drive to CO I'll save $500 on car rental; if not for this I I would buy a car in CO for sure just for the convenience factor.

[davebarnes]

Are you buying a new or used car?
Sales tax in Colorado is typically 7.5-8.5%.

[AmFest]

I'll be buying a used, 4 wheel drive car per many people's recommendations. Regular sales tax in Seattle is 9.5%, so car sales tax is 9.8%

[davidv]

In Colorado, sales tax on large items like cars is based on where you live, not where the car was bought. Davebarnes lives in Denver, so his sales tax rate is about 7.62%. I live in unincorporated Jefferson County, so my sales tax rate is about 5.1%. On a $20,000 purchase, I pay about $500 less than Davebarnes does.

[sunsprit]

With the incremental sales tax advantage and no additional registration/license fees by only registering the car in one state, you'll be ahead to buy in Colorado. As a WA resident at the time of purchase, you've got to go through all their hoops to put the car on the road.

Don't forget that you'll be buying car insurance in WA to register the car there before driving it to CO. Even when you cancel WA insurance in the short term, there will still be a minimum earned premium that will be more expensive than just the short time period you had the insurance in force.

There won't be much of a price differential between the two markets for an AWD car as they are popular in both areas, although my experience in looking at cars in the Seattle area was that they were slightly more expensive than the CO marketplace. Consider that the Denver market is more than just Denver and it's suburbs ... it pays to look into the Front Range from Colorado Springs through to Fort Collins dealers once you know the cars that interest you.

[headingtoDenver]

I may be way wrong on this, but doesn't Oregon not have a sales tax? Since you will be moving to Denver anyways, why not buy the car in Oregon and then drive it to Denver instead of buying in Seattle where you would have to pay taxes on it.

[dude_reino]

Are you financing? If so, most used car dealers will set you up with a local credit union. I'd prefer to have that credit union be local so I could go to a branch if I had to at some point. Plus, you title it in CO from the start. This is what I did when I moved from Chicago to Denver. I just drove a rental for a few days until I found a car.

[Mike from back east]

Originally Posted by dude_reino

Are you financing? If so, most used car dealers will set you up with a local credit union. I'd prefer to have that credit union be local so I could go to a branch if I had to at some point. Plus, you title it in CO from the start. This is what I did when I moved from Chicago to Denver. I just drove a rental for a few days until I found a car.

Excellent advice. I do not favor buying in another state because of possible double taxation and hassle.

If the OP's friends aren't chipping in, then I'd fly here for $100-150 (Southwest?) and be done with it. If the pals are chipping in, rent a car, split the costs and enjoy the road trip.