Sophisticated Car Title ScamsCar title scams are getting much, much more sophisticated. Be very wary if you’re purchasing a used vehicle from a private seller like on Craigslist or Facebook. Scammers are using new techniques to sell a car four or five times over, collecting the same money from different people for one car without facing consequences.
The Colorado and Texas CaseHere’s how this one worked, and this is becoming more common. The victim was from Colorado, and the vehicle was sold in Texas. The scammer put a car on Facebook Marketplace, where many private sales take place. The buyer flew from Colorado to Houston, met a real person, got the title, and paid cash for the truck. The seller only had one key fob, which seemed like no big deal since people often lose keys.
Issues at the Recorder’s OfficeThe buyer went to the recorder’s office in their county in Colorado to get the title transferred, but the recorder said something seemed off about the title. The VIN numbers on the vehicle—in the doors, on the dash, and under the hood—all matched the title. The name on the title came back to a real person, and the license plates matched. However, a detective noticed the title had been washed.
What is a Washed Title?When a title is washed, a person uses chemicals to remove some of the letters and numbers and types in new ones. In this case, the title was actually for a different vehicle. The VIN number was altered to match the vehicle being sold, but the actual vehicle was a parts-only car, a recovered theft. To make matters worse, a tracking device was hidden on the truck.
Tracking Devices and Repeated SalesThe tracking device allowed the scammer to track the vehicle, return to the buyer’s driveway, and steal the car to resell it again with another fake title. The buyer couldn’t report it stolen because they never had the car registered in their name. This scheme allows scammers to keep reselling the same vehicle repeatedly while collecting money.
Protect Yourself When Buying a Used CarWhen buying a vehicle from a private seller, always perform your due diligence. Have the title checked out by the DMV and ask the police to inspect the vehicle in person. Some sellers may resist, saying they’ll find another buyer. That’s fine—find another car. There are plenty of cars for sale.
Avoid Transactions Without a TitleNever buy a used car without getting a legitimate title at the time of purchase. If the seller promises to send the title later, apply for a duplicate, or rely on a bill of sale, don’t proceed. Without a legitimate title, you might never get the vehicle registered, no matter how much you paid.
Risks of Title IssuesIf a vehicle is stolen, has liens, or is a parts-only car, you’ll lose your money and won’t get a title. Even if you have a bill of sale or insurance, some vehicles are simply ineligible for a title due to their VIN history. Carfax and VIN checkers are not foolproof; they are consumer-level tools and cannot replace checks by the police, DMV, or NMVTIS.
The Importance of Government ChecksYou need to check three government sources to confirm a vehicle’s legitimacy: police for stolen vehicles, the DMV for liens, and NMVTIS for salvage status. If the vehicle isn’t legitimate, you won’t get a title. Though this issue affects 20-30% of transactions, losing tens of thousands of dollars isn’t worth the risk.
Visit Our YouTube Channel for more insights and discussions on various topics. Consider subscribing to our YouTube channel. Click here!
Parking Violations and Tow ImpoundmentsSo you parked in the wrong place, you left your car blocking a fire hydrant, maybe you didn’t read the sign that says no parking is allowed in this parking lot, and your car got towed. No big deal, right? You just go down, pay a fine, and get your car back. Well, you have to be very careful because, in many states, you are required to prove ownership of the vehicle before it can be released to you. If you do not have your car title, your car could stay impounded and could be sold very quickly.
Risk of Losing Your CarDrivers risk losing cars forever under state laws that allow towed vehicles to be sold days after they’re impounded within a 15-day time scale. Some states and municipalities have a rule that says if the car is not picked up and paid for within a week or two, sometimes a month, they can auction off your car and sell it. You lose your car, and the paperwork requirements to get your car out might be something you can’t do quickly, which is why it’s very important to always keep track of where your car title is located.
Importance of Regularly Checking Your Car TitleCheck it every year at least, maybe every six months. Is it in your file cabinet? Is it in a safe deposit box? Is it in an envelope? Here’s the reason why: your vehicle registration, you renew every year. Every year you get something in the mail saying your registration is expired. Pay the fee, show your insurance, and you get a new registration and a sticker for your license plate. Good to go. So, it’s a regular reminder. A vehicle title doesn’t have to be renewed. It’s a document that is printed and issued to you one time when you buy the car, and that’s it. If you lose it, you may not know about it until you need it for something, and if the reason you need it is because your car is going to be sold in a week, it might take you longer than a week to get your title. So, always make sure you know where it is.
Issues with Not Transferring the Car TitleAlso, very, very important: if you’ve purchased a vehicle and never transferred the title to your name—let’s say you bought a car on Craigslist, the person signed the back of the title, they gave it to you, and you never put it in your name, you just left the title signed to you in the drawer—that’s even worse because you can’t get another title.
Getting a Duplicate Title When It’s Not in Your NameYou can’t request a duplicate because it’s not in your name. So, even though you might be saying, “Well, I don’t want to pay the fees, it’s no big deal,” if you have a car, make sure you get that title in your name as soon as you can. If you lose it or it gets damaged, or you spill coffee on it, you’re going to have a problem, especially if the car gets towed or is in an accident. Sometimes people crash their car, and the insurance company needs the title to pay your claim. If you don’t have it, you could be out of luck. So, checking your title on a regular basis is a good thing. If you’ve lost it, get a duplicate.
The Process After Paying Off a Loan on Your CarHere’s the other thing: if you have a loan on the vehicle and you pay off that loan—you buy a car at a dealership, you have a 48-month loan, you pay your payments, you pay your last payment, send it in—what happens to the title from the lender, from the bank? They take the title that they have (because banks hold your title while you have a loan). You pay your last payment, they take that title out of their file cabinet, they sign it, stamp it “paid,” and they mail it to you. You think, “Well, I have my title,” but you really don’t because that loan, that lien on the title, that cloud on title is still registered at the DMV, at the state title office. The only evidence that it’s been paid is what is signed on that title. The banks normally don’t notify the government that you paid off your loan; they just tell you.
Handling a Lien on the TitleNow, if you lose that title, you have to go to the government, the DMV, Department of Transportation, or whatever agency in your state issues titles. Then you tell them, “Hey, I need to get a replacement title.” They pull it up on the screen: “No, you have a loan on your car.” Now, you have to go back and chase it down. Maybe the lender’s out of business, maybe they moved, maybe they just don’t have a department that can help you. Now you’re stuck. So, as soon as you get that title with that lien signed off, take it to DMV, have them remove that lien from your title record so you don’t have to worry about a duplicate title in the future. A vehicle title is a very important legal document. Make sure you have it properly recorded in your name, make sure the liens are removed, and make sure you know where it is at all times in case you need it at a moment’s notice.
Is There Such a Thing as a Fake Car Title?A vehicle title is a legal government document issued only by a government agency. It’s a certificate printed by the state. In most states, the agency is called the Department of Motor Vehicles. Some states call it something else, but it’s an official document. It’s like money. It’s like any other certificate. You can’t buy one from a company. You can’t download one from the internet. A copy is no good. It’s kind of like a copy of a $100 bill isn’t worth anything. A copy of a title is also not worth anything. You need the original certificate, and there are a lot of fakes going around.
Fraudulent Titles in OregonHere’s an article from Oregon where the DMV is warning that there are a lot of fraudulent titles out there. They’re using laser printers and all kinds of sophisticated printing technology to make fake title certificates or certificates of origin.
What is a Certificate of Origin?A certificate of origin is the original document. It’s like the birth certificate for a vehicle. It’s the ownership document that comes from the manufacturer at the factory. So when you buy a new Ford Mustang, Ford will make a certificate of origin for that Mustang at the factory where it’s built. Some scammers are making fake certificate of origin documents.
Verification of Legitimate TitlesHow do you verify that the title you’re getting is legitimate? The first thing you want to do is take that VIN number and go in person to the Department of Motor Vehicles. Don’t do it by phone. Don’t do it by email. Certainly don’t do any of these online VIN checkers like Carfax or VIN check. They’re very low-level, consumer-based online database searches.
Limitations of Online VIN CheckersThey’re not entirely accurate. They don’t show anything about liens. Sometimes even the information on stolen cars isn’t there. The only 100% accurate vehicle records information comes from the government.
Additional Verification StepsAnother thing you want to do is take that VIN number in person to your local law enforcement agency—police department, sheriff, anybody with a badge and a gun—and have them look it up in their system to see if it’s stolen.
Precautions When Handling TitlesProtect yourself from fake titles. Even if the seller is handing you a title, make sure it’s properly signed. Make sure that the name you see on the front of that title matches their ID.
Buying from Dealerships vs. Private SellersIf you buy a car from a dealership, before you give them the money, have them show you the title. Private sellers actually can be a little more secure as long as you verify that title and make sure that the person you’re buying it from shows you their ID.
Mechanics Lien and Title ProblemsI know what you’re thinking: you have this vehicle, you have a title problem, and you’re thinking, “Wait, an easy solution is just to file for a mechanic’s lien and I’ll get a title.” Even if you are a licensed automotive facility, you may find that filing a mechanic’s lien not only will not work to get you a title, but it could backfire and create some problems for you. Here’s the thing: what many people aren’t aware of is that filing a mechanic’s lien for a vehicle title is a very specific process.
Consequences of Filing a Mechanic’s LienIt should only 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 taken against you, and number three, you could lose the vehicle. So let’s take a look at how that works. What may not be readily visible to you is that any time you file a mechanic’s lien, 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 mechanic’s lien. They have task forces that are trying to prevent mechanic’s lien title applications from going through. You have lien holders that are out there trying to block mechanic’s liens. You also have an enforcement arm of your local district attorney looking at mechanic’s liens. It opens up an enforcement and audit process.
Florida’s Mechanic’s Lien ExampleSo let’s take a look at what a mechanic’s lien is. Here’s one example from Florida for lien enforcement of a lien sale of a motor vehicle. A person claiming a lien under statute 713 for performing labor or services may enforce a lien by sale of the vehicle in accordance with the procedures, and if you notice, this goes on and on. Here are the procedures—this goes on for pages. A copy of their certificate, a copy of this, failure to make good faith efforts precludes the imposition of charges. If you make any mistakes at any time, the owner can request to inspect the vehicle. You can’t charge—a lienholder or sales agent may not charge fees in excess of $250. Must use third-party services with a million-dollar bond. There are all kinds of requirements 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 lien must be sold at public sale, very clearly. Immediately upon the sale, the lienholder, meaning the seller, must deposit with the Clerk of Court the proceeds of the sale. 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, a hearing should be held. Now look, in this there’s an option you have: at any time before the sale, the owner 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 what the official statutes are.
Forces Against Mechanic’s Lien FilingNow when I said before that there are forces lined up against you to prevent you from getting your mechanic’s lien, we’re going to look at those, but don’t despair. There is a method you could use that’s better than a mechanic’s lien that doesn’t have any of these adversaries. These people are not trying to block you, and it’s faster, cheaper, and easier than a mechanic’s lien, and most people don’t know about it. We’ll talk about that at the end.
Fraud Prevention in Mechanic’s Lien ProcessSo how do we know that there are forces working against you? Well, here is a trade publication: “Filing Fraudulent Mechanic’s Liens—Don’t Do It” and “Auto Lien 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, and DMVs know that a lot of mechanic’s liens are fraudulent, or even if they’re not, they’re trying to block them. Facts indicating lien sale fraud: not able to contact the customer, no accident information from the insurance company, tow/repair shop recently incorporated or not licensed, telephone number for the towing company is not answered. So there’s going to be a lot of red flags. Steps to take to prevent lien sale fraud: calendar the lien 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 PreventionYou’re also going to contact the person starting the lien 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 lien sale piracy. If you’re using a lien 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 Mechanic’s Lien Fraud”—this is from 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 mechanic’s lien 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 practices for preventing that. Let’s take a look at some of that. First, they tell you the reason that they’re doing it is because of inadequate, outdated title laws—financial institutions may suffer significant losses from people taking advantage of mechanic’s liens.
DMV Fraud Detection PracticesThere’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 mechanic’s liens? And here’s the fraud they’re identifying in the mechanic’s lien process: title brand washing, trying to remove a title brand, lien washing, fraudulently removing a lien holder without a valid lien release. So if you want to remove a lien, get a valid lien release. There are better ways to do it that are legal than trying to do a mechanic’s lien, and we’ve talked about it before, and our website will explain that to you. If you try to use a mechanic’s lien for getting rid of a bank lien, you’re just putting a big target on your back and a big flashing light on that VIN number for them to look at it and to possibly catch you doing something illegal.
Fraudulent Practices and Their ConsequencesFraud may occur when a lien claim intentionally circumvents the notification requirements: not providing the owner information, not doing the notification, intentionally sending empty or junk-filled envelopes to the legal owner, sending it to incorrect addresses. Also, this is a big one—selling the vehicle to their employees, not holding a public sale. So if you’re trying to get the title for yourself, that’s what you do—you won’t hold a public sale where your vehicle gets the highest price.
Avoiding Fraud and Mechanic’s Lien PitfallsTrying to avoid getting 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. In chapter four, they tell you the process to locate and notify the vehicle owners. They tell you how to do that using the NMVTIS. They’re also going to tell you how to use lien title services and third-party agents and find out which ones are committing mechanic’s lien fraud. And the biggest way they do that is through fraud in advertising. So you might use a false VIN number, a fictitious ad for a sale that never takes place. This occurs when the lien claimant creates a newspaper ad but never publishes it 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 that it was actually held. Collusion between the lien claimant 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 and Internal AuditsAnother 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 something that there aren’t people watching what actions you’re taking. And so at the DMV, they tell you the best practices for registries 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 lien notice forms, bill of sale, affidavit of ownership. They’re going to do a background check on all the parties to make sure there are no relationships. They’re going to verify the lien, and what they’re going to do in many cases is even if everything looks okay, they’re going to reject it and 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, placing 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.
They’re going to internally audit all the records for that repair shop to see: did they have a repair record for that vehicle before they did a lien sale? If you can’t show that you had a record of repair on that vehicle before you’re doing a lien sale, that right there is a red flag that’s going to catch you in the act of trying to do a fake mechanic’s lien. 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. They’re not playing around. They are doing this very specifically in all 50 states. We are in contact with all 50 states’ DMVs on a regular basis discussing how these issues are coming up in different states and how they’re being caught.
Abandoned VehiclesWe’re going to talk about the most commonly requested subject that comes up from callers to our private vehicle title helpline. This is the most frequently asked for information, and it’s what most people who contact us ask about: abandoned vehicles. Mostly it’s because the person who’s calling needs to get a vehicle title a legal title document for a vehicle and the idea they came up with is to say, “I’m going to declare it as an abandoned vehicle and claim it.”
The Consequences of Declaring a Vehicle AbandonedWe’re going to talk about that and look at the laws and how that works because one of the things you have to remember is that an abandoned vehicle may not be the actual definition of the vehicle you’re trying to get a title for. And as soon as you declare it as an abandoned vehicle, it is now permanently locked into that definition, and you may not be able to get a title it may permanently ban you from getting a title.
Better Methods Than Declaring a Vehicle AbandonedThere are often better methods of getting a title than trying to claim it to be abandoned because if you think about it, where did you hear about abandoned vehicles? Probably just something you came up with or maybe you read it on some discussion group. It’s not normally the best way to get a title. In fact, most of the time, if you declare and say a vehicle’s abandoned, you will lose the vehicle forever to the government.
Government-Issued TitlesRemember, a title is a legal government document issued only by a government agency. You can’t buy one from a company, you can’t download one from the internet. The government decides who to give titles to based on their rules. The government agency in most states is called the Department of Motor Vehicles. Some states call it the Department of Transportation.
Abandoned Vehicle Laws Across StatesYou’ll notice that when we look at a few states, the rules are going to be almost exactly the same from all these different states. Why is that? Well, the rules for abandoned vehicles come from federal guidelines federal government guidelines. So all the states’ rules are about the same. You’ll see as we look at three or four states here how it works, even if your state is not one of the ones we use as an example.
Pennsylvania’s Vehicle Disposal RulesFirst, we’re going to look at a fact sheet on the disposal of abandoned vehicles from private property, and that’s probably what you’re thinking about because you can’t really claim abandoned vehicles on the side of the road, right? If it’s on the highway or if it’s on a street, you can’t really claim that. But if it’s on your property, you might say, “Hey, if it’s on my property, I’ll charge storage fees and I’ll claim the vehicle.”
Definitions of Abandoned Vehicles in PennsylvaniaThe purpose of this fact sheet is information on disposing of vehicles which have been left on private property. Notice the word “disposing.” It doesn’t say “ownership.” This is from the Pennsylvania Department of Transportation. The definition of terminology: abandoned vehicles involve an intention to abandon together with an act of surrendering the vehicle.
Legal Definition of Abandoned Vehicle in PennsylvaniaAbandoned property is that which an owner has relinquished all rights, title, and claim, and possession with no intention of claiming it or resuming ownership. So if you declare it to be abandoned, you’re saying that the owner and you see, it says “an owner,” not “the owner”, “has relinquished all rights, title, claim, and possession.” If you’re saying you’re the owner, then you’re relinquishing rights just from day one. You might be game over on doing it.
When a Vehicle is Presumed Abandoned in PennsylvaniaA vehicle shall be presumed to be abandoned under any of the following circumstances, but the presumption is rebuttable, meaning that it’s not 100%:
Private Property and Abandoned VehiclesYou might say, “Yeah, it’s been here for more than 24 hours,” but did you ever give consent to the person to put it there? Did you ever say, “Hey, you can leave your car here for a couple of days”? Did you buy the car and give somebody money and they gave you a bill of sale? Well, that was consent because you put it there. So this doesn’t apply for most scenarios without the consent of the owner. Now, if somebody just voluntarily drives a car onto your driveway, leaves it, and takes off and you don’t know who it is and you never told them to do it, that might apply.
Methods of Disposing of Abandoned VehiclesSo what do you do? Here are the methods of disposing of vehicles:
What Happens After Vehicle RemovalThe vehicle may be sold at a sheriff’s sale. The property owner may file suit in common pleas court requesting that an order be entered awarding ownership. That sounds like a court order title we’ll talk about that later.
Court Order for Vehicle OwnershipYou can’t declare it as abandoned and say, “I want to keep it.” You have to petition and request that an order be entered to award you the ownership, and that request will extinguish the title and interest of any other person. The property owner may not repossess an automobile for the cost of storing the vehicle unless you are a bona fide warehouseman provided by the Universal Commercial Code.
Challenges with Vehicle Ownership ClaimsWhat if you say, “Well, I did work on it and I want to use that to claim the ownership”? Well, a bill incurred for repairs to a vehicle can be collected only by filing a complaint and obtaining a judgment against the owner. What does that sound like? Sounds like a court order title, right?
Texas Rules on Abandoned VehiclesTexas law says that there are certain requirements you have to meet if you are going to charge, store, or remove a vehicle. What if you’re a storage facility, like a self-storage yard? Well, the first thing you need to do is: the garage keeper shall report the abandonment of the motor vehicle to a law enforcement agency in the jurisdiction where the vehicle is located and pay a $10 fee for notification. The garage keeper shall retain custody of the abandoned motor vehicle until the agency takes the vehicle into custody. So what does that say? The cops are going to take the car if you say it’s abandoned.
California’s Lien Sale ProceduresIf you declare it to be abandoned, you have to report it to the police and they come take it. What if you don’t report it as abandoned? A garage keeper who fails to report an abandoned vehicle to a law enforcement agency within 7 days after the date it’s abandoned may not claim reimbursement for storage of the vehicle.
Legal Process for Vehicle Ownership in CaliforniaLast but not least, we’re going to look at California. So here’s a place—for California, if you’re thinking about California, you can call us and talk to us about these situations, but we just want to let you know that an abandoned vehicle in California is also the same, meaning the law says that you can’t just declare it as abandoned.
ConclusionThe only way to keep abandoned cars forever is through proper paperwork, court orders, salvage, and legal procedures. Simply declaring a vehicle “abandoned” doesn’t automatically grant you ownership and often results in losing the vehicle to government authorities. Before pursuing any abandoned vehicle claim, consult with legal professionals and explore alternative title acquisition methods that may be more appropriate for your specific situation.
Tell us about your vehicle and we'll direct you to a title recovery method that matches your scenario.
"*" indicates required fields
