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This guide provides essential information for dealers looking to offer car consignment services in Virginia. Understanding these requirements helps ensure compliance with state regulations.
Car consignment in Virginia is legal, but licensed dealers must follow specific requirements designed to protect sellers and buyers. These Virginia car consignment rules, dealer requirements, and best practices (updated for 2026) cover dealer licensing, written consignment contracts, title/odometer handling, lien payoff, insurance, safety inspection obligations, and fee transparency.
Only licensed Virginia motor vehicle dealers may offer vehicles for sale on consignment.
The Virginia Motor Vehicle Dealer Board (MVDB) oversees and regulates the dealer industry and licensing.
Source: Virginia Motor Vehicle Board (MVDB)
Source: MVDB — Dealers / New Dealer Packet
Virginia requires that any dealer offering a vehicle for sale on consignment must have a consignment contract in the dealer’s possession, executed and signed by both dealer and consignor.
The consignment contract must include (at minimum):
Owner(s) full name, address, and telephone number
Selling dealer name, address, and dealer certificate number
Vehicle description including make, model year, VIN, and body style (with certain trailer exceptions)
Contract beginning and termination dates
Commission percentage/amount or net amount owner will receive
Any fees the owner is responsible for
Disclosure of all unsatisfied liens and the location of the certificate of title
Safety inspection requirement (or required buyer disclosure if the vehicle did not pass after inspection)
Virginia MVDB also publishes a one-page consignment agreement checklist dealers can use to ensure the agreement contains the required fields.
Source: MVDB Consignment Agreement Checklist (PDF)
Source: State Requirement (statute): VA Code § 46.2-1531 (Consignment vehicles; contract)
In a typical consignment, the vehicle title remains in the seller’s name until the retail sale, but Virginia requires the dealer to disclose in the consignment contract the location of the title and any unsatisfied liens.
Virginia dealers must comply with federal odometer requirements and Virginia’s dealer odometer rule.
Virginia DMV guidance: when a vehicle is sold or transferred, the seller records the odometer reading on the title assignment; if an out-of-state title lacks an assignment section, an odometer disclosure statement may be used.
Useful VA DMV Forms/Resources:
Virginia law does not require dealers to maintain separate escrow or trust accounts specifically for vehicle consignment proceeds under the general consignment statute (§ 46.2-1531). Dealers may handle funds through normal operating or trust accounts, so long as the handling complies with all applicable fiduciary, escrow, and settlement requirements under general Virginia law when those provisions are applicable.
Because the consignment statute focuses on contract contents and disclosures rather than payout timing, the written consignment agreement should clearly state the timeline and method for remitting net proceeds to the seller.
Best Practice:
• Dealers should segregate consignment funds or use a designated business account to avoid commingling seller proceeds with personal or unrelated business funds.
• The consignment contract should state when the seller will receive net proceeds after sale and any conditions affecting timing.
• Many reputable dealers remit net sale proceeds to the seller within 24–48 business hours after the dealer is funded by the buyer or lender, subject to title release and lien payoff processes.
Documentation of funds receipt, account handling, payout timing, and seller remittance should be retained in the deal file to demonstrate compliance and support audits or regulatory reviews.
Virginia’s consignment statute includes specific rules about test drives and plates:
Dealers must inform any prospective buyer customer that the vehicle is on consignment.
Dealer plates generally may not be used to demonstrate a consigned vehicle, with limited exceptions (e.g., heavy vehicles, vehicles consigned from another dealer, or certain nonprofit consignments). Instead, use the consign owner's plates during test drives.
The owner’s plates may be used for test drives if liability insurance coverage is in effect in the amounts required by Virginia law.
Insurance note: VA’s owner’s policy coverage statute provides the liability limit framework (coverage amounts vary based on policy effective dates; confirm current thresholds).
Best Practice: Dealers should confirm with their insurance agent/underwriter that their garage liability policy covers both Owned and Consigned inventory for liability and test-drive risk, and should document the plate/insurance approach in the deal file.
Virginia’s consignment statute requires that the vehicle pass a safety inspection prior to sale, or if it is found not to be compliant after inspection, the dealer and consignment seller must work together to either bring it into compliance or provide the buyer a written disclosure prior to sale that it did not pass.
Vehicles with open loans can be consigned, and dealer uses similar payoff processing and timelines as outright purchases or trade-ins. The lienholder must be satisfied by the selling dealer, so title can transfer cleanly at/after the sale.
Best Practice: At intake, the seller should provide:
Lender contact information
A current payoff statement
Written authorization for the dealer to process payoff
If the payoff exceeds expected net sale proceeds (sale price minus commission/fees), the dealer should address the shortfall upfront, and may require the seller to place sufficient funds in escrow to cover estimated shortfall so the lien can be released without delaying title delivery at time of sale.
Virginia requires consignment contracts to disclose the commission or net amount payable to the owner and any fees the owner is responsible for.
All charges related to the consignment must be clearly documented in the written agreement, including:
• Commission percentages or flat fees
• Reconditioning or repair authorizations
• Detail, storage, or marketing fees
• Inspection or compliance costs
• Administrative or documentation charges
Best Practice: Disclose all fees (commission, authorized reconditioning, detail, storage, marketing, inspection/repair authorizations) in plain language and have the seller initial fee sections.
Virginia’s consignment statute requires the contract include the beginning and termination dates of the agreement.
Best Practice: Your contract should also state cancellation terms (notice requirements, vehicle retrieval procedures, and any documented out-of-pocket cost recovery) to prevent disputes.
Can a private seller consign without going through a dealer?
Consignment sales offered to the public must be handled by a licensed motor vehicle dealer regulated by MVDB.
Do I have to tell buyers the vehicle is consigned?
Yes. Virginia requires dealers to inform any prospective customer that the vehicle is on consignment.
What must be in the consignment contract in Virginia?
Virginia law lists required items including owner/dealer info, vehicle description, contract dates, commission/net, owner fees, liens/title location, and safety inspection/disclosure language.
Want more general answers about selling or consigning a car?
Visit Retail My Ride’s full FAQ center
Last reviewed: January 2026
Once you understand the consignment requirements in Virginia, the next step is putting them into practice. Retail My Ride connects licensed dealers with motivated consign-ready sellers, helping you stay compliant while growing your inventory.
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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.
Learn more through our Articles, Common Questions, Testimonials, About Us, and Which Vehicles Are Best Suited for Consignment.
