How NOT To File A Mechanics Lien On A Vehicle

Mechanics Lean and Title Problems
I know what you’re thinking you have this vehicle you have a title problem and you’re thinking wait an easy solution is just file for a mechanics lean and I’ll get me a title even if you are a licensed Automotive facility you may find that filing a mechanics lean not only is it not going to work to get you a title but it could backfire and could create some problems for you here’s the thing what many people aren’t aware of is filing a mechanic lean for a vehicle title is a very specific process.

Consequences of Filing a Mechanics Lean
Only to be used in certain circumstances and if your situation does not meet those circumstances not only will you not get a title but number two you could be fined and have enforcement action against you and number three lose the vehicle so let’s take a look at how that works what may not be readily visible to you is any time you file a mechanics lean you now have three or four very powerful forces aligned against you to keep you from getting that title you have the DMV they don’t want you to get a title on a mechanics Lane they have task forces that are trying to prevent mechanics lean title applications from going through you have lean holders that are out there trying to block mechanics leans you also have an enforcement arm of your local district attorney looking at mechanics lean it opens up an enforcement and audit process.

Florida’s Mechanics Lean Example
So let’s take a look at what a mechanics lean is here’s one example from Florida for leans enforcement of a lean sale of a motor vehicle a person claiming a lean under statute 713 for performing labor or Services May enforce a lean by sale of the vehicle in accordance with the procedures and if you notice this thing goes on here here’s the procedures this thing goes on for pages right a copy of their certificate a copy of this failure to make good faith efforts um precludes um the imposition of charges if you make any mistakes at any time the owner can request uh to inspect a vehicle um you can’t charge a leaner or sales agent may not charge fees in excess of $250 um must use third party services with a million dollar Bond there’s all kind of stuff that’s on here that would probably make your application invalid or ineligible also at the end of this process you can’t keep the vehicle you have to auction it off a vehicle subject to a lean must be sold at public sale very clear immediately upon the sale the lean the leaner meaning the seller must deposit with the Clerk of Court the proceeds of the sale right so there’s a lot of stuff you have to do here the clerk receives 5% of the proceeds and that’s after you go through all this after final demand the hearing should be held now look in this there’s an option you have for at any time before the sale the owner uh may post a bond or file a demand for hearing so that’s going to be a clue of what things you can do so here’s here’s what the the official statutes are.

Forces Against Mechanics Lean Filing
Now when I said before that there are forces lined up against you from getting your mechanics lean we’re going to look at those but don’t despair there is a method you could use that’s better than a mechanics lean that doesn’t have any of these adversaries these people are not trying to block you and it’s faster it’s cheaper it’s easier than a mechanic lean and most people don’t know about it we’ll talk about at the end.

Fraud Prevention in Mechanics Lean Process
So how do we know that there are forces up against you well here is a trade publication filing fraudulent mechanics leans don’t do it auto lean sale fraud in Florida what every lender needs to know this is auto dealer today this is a dealer publication this was published five years ago the automotive industry lenders DMVs know that a lot of mechanics are fraud or even if they’re not they’re trying to block it facts indicating a lean sale fraud not able to contact the customer um no accent information from the insurance company um toy repair shop recently incorporated or not licensed telephone company for the towing company is not answered so there’s going to be a lot of red flags steps to take to prevent lean sale fraud calendar the lean sale date contact the customer including did the towing company tow your vehicle did you authorize repairs the bank is going to contact the owner of the vehicle and ask them if it’s legitimate if it’s not it’s going to be reported to law enforcement.

Best Practices for Fraud Prevention
You’re also going to contact the person starting the lean to get documentation for the Towing and storage and if you provide them fake documentation that’s another crime don’t be a victim of what they call lean sale piracy if you’re using a lean sale to take a vehicle away from somebody you’re not supposed to take it from you’re going to get in trouble best practices for prevention of abandoned vehicle mechanics lean fraud this is the American Association of Motor Vehicle administrators those are DMV Commissioners motor vehicle administrators are the people who run the DMV they have put together best practices for prevention of mechanics lean fraud what does that tell you that tells you that the DMVs are aware of this they have put together best practices what are some of the best practices here is their 39-page handout it’s a 39-page manual on the best practice of preventing that let’s take a look at some of that first they tell you the reason that they’re doing it is because inadequate outdated title laws financial institutions may suffer significant loss by people taking advantage of mechanics Lanes people taking advantage of mechanics Lanes.

DMV Fraud Detection Practices
There’s a working group task force to develop detection of fraud in the title application process they are actively looking for fraud with these cases we’ve talked in Prior videos about how they do it they audit them they have sophisticated software that will flag applications based on your Automotive license should you be doing this many uh mechanics leans and here’s the fraud they’re identifying in the mechanics lean process title brand washing trying to remove a title brand lean washing fraudulently removing a lean holder without a valid lean release so if you want to remove a lean get a valid lean release there are better ways to do it that are legal than trying to do a mechanics lean and we’ve talked about it before and our website will explain that to you if you try to use a mechanics lean for getting rid of a bank lean you’re just putting a big Target on your back and a big uh flashing light on that VIN number for them to look at it and to possibly catch you in doing something illegal.

Fraudulent Practices and Their Consequences
Fraud may occur when a lean claim in intentionally circumvent the notification requirements not providing the owner information not doing the notification intentionally sending empty or junk filed envelopes to the legal owner sending it to incorrect address also this is a big one um selling the vehicle to them employees not holding a public sale right so if you’re trying to get the title for yourself that’s what you do you won’t hold a public sale where you’re your vehicle.

Avoiding Fraud and Mechanics Lean Pitfalls
Trying to get the highest sale price in a public sale you just want to slide it to your friend or to yourself that’s going to be fraud and they’re going to catch you chapter four they tell you the process to locate and notify the vehicle owners they tell you how to do that um using the nmvtis um they’re going to also tell you how to use lean title services and third party agents and find out which ones are committing mechanics lean fraud and the biggest way they do that is fraud and advertising so you’re going going to use a uh false VIN number a fictitious ad for a sale that never takes place this occurs when the lean claim it creates a natural vehicle but never publishes as required or they don’t actually hold the sale what does the DMV do they’re validating and verifying the ad and also validating and verifying the sale making sure it matches the vehicle and it was actually held collusion between the lean claim and the buyer that means that if the person you’re trying to steer the title to is a friend of yours and you’re colluding to make sure they get the vehicle that’s also a crime in some cases it’s a felony.

Legal Consequences of Fraudulent Mechanics Lean
Another big one is intentionally holding a vehicle to increase storage costs and that is a way to try to jack up your fees again they know about all this this is published information at the DMV so they’re looking for it so don’t think just because it’s possible to do that there’s not people watching what actions you’re taking and so at the DMV they tell you the best practices for juries is to review the application and when I say review they go over it with a fine tooth comb they look at the application the fees the jurisdiction the lean notice forms bill of sale affidavit of ownership they’re going to do a background check on all the parties to make sure there’s no relationships they’re going to verify the lean and what they’re going to do in many cases is even if everything looks okay they’re going to reject it send it back to you with the hopes that you’re going to be scared that they caught you and you’re not going to refile it they’re also going to do a stop title process place an administrative stop on the application during the review this makes sure that the vehicle isn’t fraudulently conveyed to another party this is the big one internal audit.

Internal Audits and Fraud Prevention
You’re going to they’re going to internally audit all the records for that repair shop to see are they did they have a repair for that vehicle that was paid tax on before they did a lean sale if you can’t show that you had a record of repair on that vehicle and then you’re doing a lean sale that right there is a red flag that’s going to catch you in the act of trying to do a fake mechanics lean and what they’re going to do is if they suspect fraud they’re going to take that title application and they’re going to retain it for criminal prosecution criminal prosecution they’re not playing around right they are doing this very specifically uh at all 50 states we are in contact with all 50 states DMV on a regular basis discussing how these issues are coming up in different state lines and they’re being caught.

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