Home » Articles » Titles » A Comprehensive Guide to Vehicle Titles
A vehicle title is a legal document that proves ownership of a vehicle. While most vehicles require a title, obtaining a vehicle title isn’t necessarily a cookie cutter process. There are a variety of methods to obtain a vehicle title, each with its own set of requirements from the owner and reasons for being used.
A clear title is one in the owner’s name that doesn’t have a lien or third party that could attempt to claim ownership. With a clear title, the owner is free to sell the vehicle if desired.
If you do not have ownership documentation for a vehicle, you may purchase a surety bond to obtain a bonded title. The surety bond is equal to the value of the vehicle and covers any future claims in the event that a valid ownership claim to the vehicle comes forward in the future. Bonded titles are stamped “Bonded” for a period of 3-5 years before eventually coming off of the title where the owner can then apply for a clear title.
When a vehicle incurs major damage, the title may be designated as a salvage title. Typically insurance carriers will determine if a vehicle requires a salvage title, often when more than 60% of the vehicle’s value is lost. However, even if a vehicle doesn’t have massive damage, an insurance carrier can still place a salvage title brand on any vehicle. Salvage titles are permanent and cannot be removed under federal law.
Titles that have been sold to junkyards may be designated junk titles if the vehicle is intended to be scrapped or sold for parts. Vehicles and parts who’s VIN is part of the NMVTIS database can not be titled after receiving a junk title brand.
When insurance companies pay claims for vehicles and take ownership, they are eligible to process the title as a certificate of destruction. Vehicles with this title are intended to be destroyed or never used on the road again.
If you are the legally titled owner of your vehicle and you’ve simply lost your title document, you can apply for a duplicate title. Duplicate titles can only be issued in the state that they were originally registered and only to the last titled owner in the DMV database.
The very first document that was issued by the manufacturer to the dealer. This document is intended to be used to transfer the vehicle title to the first owner and obtain a title.
Similar to the certificate of origin, but involving brand new imported and domestic vehicles.
Vehicles that have been substantially rebuilt may have a reconstructed title brand issued by an insurance company, body shop, collision center, or licensed rebuilder. These vehicles can typically be used for road use, but may require additional inspections to verify it’s safety.
A title may be issued under an affidavit in lieu of missing documentation. This title method is often a last resort when all other options have been exhausted.
A parts-only designation is normally found on the bill of sale or transfer form, but not a title. However, if a parts-only bill of sale is submitted for vehicle title processing, the title may be issued with a salvage brand or other irreparable brand on title.
A vehicle that has a lien or a title loan may have the title issued directly to the lienholder. The purchaser will be listed as the owner, but the title will list the lienholder. Once the lien or loan is paid in full, the owner may send a lien release request letter to the lienholder for title transfer.
A vehicle being exported will likely need title documentation for customs clearance. If the vehicle is not declared at the exit point, a clear title may not be possible in the destination country. Start the title process early so that port storage fees do not accumulate while waiting for the title.
A vehicle being imported to the US must have legal title to clear customs. If the vehicle was previously titled in the US this is a vehicle title recovery process only. If the vehicle was not originally manufactured for the US market, there are requirements for certifying that the vehicle is legal for use in the United States. The Department of Transportation (DOT), Environmental Protection Agency (EPA), National Highway Transportation Safety Administration (NHTSA) and other agencies will need to verify that the vehicle meets standards for emissions, safety, bumper height, and other guidelines prior to entering the country.
Many state DMV title systems are transitioning to issuing electronic or paperless titles rather than physical paper documents.
Although selecting your title method may be challenging, it’s an important part of vehicle ownership. By titling your vehicle in your name, you’re ensuring that the certificate of ownership for your vehicle can never be legally transferred to someone else without your consent. Looking to title your vehicle, but need assistance choosing your title method or recovery process? Text TITLE to (402) 698-4853 for assistance in choosing your title method or recovery process.
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