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This guide provides essential information for dealers looking to offer car consignment services in Indiana. Understanding these requirements helps ensure compliance with state regulations.
Car consignment in Indiana is legal, but dealers must follow Indiana’s dealer rules covering consignment agreements, buyer identification/disclosure, plated/insured vehicle handling, and title delivery timelines. These Indiana car consignment rules, dealer requirements, and best practices (updated for 2026) cover dealer licensing, written agreements, title handling, seller funding timing, insurance, lien payoff, fee disclosure, and cancellation terms.
Only properly licensed Indiana motor vehicle dealers may sell vehicles to the public, including vehicles sold on consignment.
Indiana dealer licensing, audits, and enforcement are handled by the Indiana Secretary of State – Auto Dealer Services Division.
Source: Indiana SOS Auto Dealer Services (dealers portal/forms)
Source: Indiana Dealer Licensing
Source: Indiana Administrative Code – consignment sales rules (75 IAC 6-2-8)
Indiana has specific rules for consignment sales and expects a completed consignment agreement for each vehicle sold on consignment.
A consignment agreement is required for vehicles offered for sale on the consignment sales lot, even if the consignor has not provided title at intake (the consignment rules contemplate this situation).
The consignment agreement must be retained in dealer records; Indiana’s consignment rules require maintaining copies for three (3) years.
Indiana SOS lists a state-required dealer form called SF 53608 – Consignment Agreement under the “Motor Vehicle Sales” section of forms page.
Indiana defines “consignment sales” as dealer sales of vehicles not titled or assigned to the dealer.
Indiana consignment rules require the consignor to provide the dealer with the vehicle title and a properly executed consignment agreement (and related ownership/lien documentation).
Indiana’s “31-day title law” requires dealers to deliver/transmit title within the required timeframe (and the SOS explains the consumer remedy process if title is late).
Best Practice: Maintain a complete deal jacket including consignment agreement and proof of title delivery processes (mail tracking, customer receipt, title processor receipt, etc.).
Indiana’s published dealer guidance is very clear on title delivery timing to the retail buyer (31 days), but Indiana does not publish a universal “consignment payout deadline” for seller proceeds. Therefore, seller funding timing should be defined in the written consignment agreement.
Best Practice: Put the payment trigger and timeline in writing (example: “within X business days after the dealer receives cleared funds from the buyer/buyer’s lender”), and clearly list authorized deductions (commission/fees, recon, lien payoff, etc.).
Indiana’s consignment rules include a key operational constraint:
The vehicle should remain plated and insured by the consignor during the consignment period for demonstration purposes.
Indiana dealer guidance also notes that interim plates may not be placed on vehicles sold on consignment.
Best Practice:
Require proof of the seller’s insurance at intake and have the seller initial the insurance section of the agreement.
Confirm your garage liability coverage for test drives and on-lot incidents with your insurance agent/underwriter.
Indiana consignment rules require identifying any lienholder in the consignment agreement and handling liens as part of a compliant sale process.
Best Practice:
At intake collect lender contact info, a current payoff statement, and written authorization for payoff processing.
If negative equity exists (payoff exceeds expected net proceeds), collect the shortfall per your agreement so liens can be satisfied promptly at sale.
All dealer fees/commissions should be disclosed in writing in the consignment agreement (commission/flat fee, recon authorizations, storage/marketing, admin/doc fees, etc.).
Best Practice:
Include a simple “Seller Net Sheet” line item math: sale price minus commission/fees minus authorized deductions = estimated net proceeds.
Consignment cancellation/termination terms should be spelled out in the agreement: notice requirements, vehicle retrieval timing, and any authorized costs due on termination.
Include unwind language for rescinded retail deals (return of vehicle / return of funds / deduction rules).
Can a private seller consign a car through a dealer in Indiana?
Yes—Indiana recognizes dealer consignment sales, but dealers must use a properly executed consignment agreement and follow the state’s consignment rules.
Does Indiana require the car consignor to keep plates and insurance active?
Indiana’s consignment rules state the vehicle should be plated and insured by the consignor for demonstration purposes, and dealer guidance notes interim plates may not be used on consignment vehicles.
What’s the key timing rule Indiana retail car buyers care about?
Indiana requires timely title delivery (commonly referenced as the “31-day title law”), and consumers have a defined demand/return remedy if title is not delivered.
Want more general answers about selling or consigning a car?
Visit Retail My Ride’s full FAQ center
Last reviewed: January 2026
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This page is provided by Retail My Ride for general informational purposes only. It is not legal advice. Car consignment laws and dealer requirements may change at any time. Always confirm the latest rules with your state DMV, licensing authority, or qualified legal counsel before making decisions.
This information is provided for general reference only. Laws and regulations change frequently. Always consult with legal counsel and verify current requirements with your state's DMV or regulatory authority before offering consignment services.
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