Answer: Transactions of this type are very common, they are illegal, and they can constitute fraud. As such, they keep people like me busy on a regular basis as an expert witness in court.
Simply put, with very few exceptions (such as a surviving spouse-and a copy of the death certificate) a deceased person cannot sell you a car. In this particular case there are many possible implications that can come back to haunt you. Suppose the dead brother’s estate was probated and this car, which is considered an asset, was hidden? Or suppose that while the brother was alive, he pledged the car as collateral, and the creditors are now looking for it? There are many other possible dangerous implications, but these are the two most common.
The “transferable registration” is the proper document used to convey ownership of any motor vehicle that was manufactured prior to 1973, and is registered in New York. However, it does not place a value on the vehicle. For these purposes a Bill of Sale may be necessary, and once again, a deceased person is not in a position to sign a Bill of Sale. One trip to the DMV and you will quickly discover that the names and signatures on all documents related to this sale must match.
Over the years I’ve seen many deals of this nature that had to be undone. It is not easy and you will likely be the one that loses the most. My suggestion is to insist that the seller do whatever is necessary to obtain a “transferable registration” in his name. At the very least he will have to obtain insurance-and pay sales tax, which is why most sellers try to avoid this step, but in the end he will have a registration that he can sign over to you. It’s important to understand that this does not completely eliminate the risks outlined above. It simply means that if in fact there is something fraudulent going on with the sale of the car, it does not extend to you. This puts you in a much better position should a problem arise in the future.