The Importance of Titles in Vehicle TransactionsSo, for a vehicle, you have a title and you have a bill of sale. They’re two different things.
What is a Bill of Sale?
You may only have a bill of sale and want to get a title. So how does that work?Well, unfortunately, a bill of sale is only a record of a particular event of one person saying, “I’m selling you this car.” It’s not a complete transfer of ownership because the bill sale doesn’t say that the person who’s selling it actually owns the car. It doesn’t say if there’s a lien on the car. There’s no verification on a bill of sale that the seller has the authority to sell the car. Maybe they do, but by itself, the bill of sale doesn’t disclose that because anybody can write a bill of sale.You can write on a piece of paper, “I, Joe Schmo, sell this car,” and put the rest of it on there. There are blank forms you can download that might look official, maybe even from the DMV. Bill of sale, you fill it out, but there’s no prior verification that the information is correct. The only thing that a DMV or government agency is going to look at that’s a valid ownership verification is the prior title.
The Role of the TitleSo, when you buy a car, what you’re supposed to do is have the seller of that car have their name on the front of the title. They flip it over and they sign the back, and they give it to you. That’s a guarantee that that title and card are now yours. If it’s only a bill of sale, who knows if that seller is the owner? Who knows if there’s not a lien? Who knows if maybe there’s another owner, right?
The Risks of Relying Solely on a Bill of SaleThe bill of sale isn’t good enough. The DMV won’t accept it. You shouldn’t either. Why not? Well, what if it was your car? If somebody just had your car and your keys and just filled out a bill of sale, they could sell the car to somebody else. If that was enough, you having your title document somewhere in the safe deposit box in your file cabinet, maybe, you know, somewhere in your house, is what protects your ownership of that car. So if it was good enough just to have a bill sale to flip a car around, then you wouldn’t need titles because it would have no value.
Options for Obtaining a Title with Only a Bill of SaleAre there ways to transfer a car and get a title with only a bill of sale? There’s a few ways to do it that might have some other requirements. You can look at some of our other videos to find out more about how to get a title if you only have a bill of sale and to construct the rest of the ownership using other means. Maybe Vermont, maybe bonded title, maybe affidavit. You can look at our other videos to do that. But by itself, if you’re buying a car, make sure that if you’re accepting only a bill of sale, that you know the risk and you know you’re going to do some work to get the title in your name.
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Solutions for Solving Your Title Problem
So what are the solutions for you to solve your title problem? In many cases, a title problem seems bigger than it really is. In most cases, there’s a very simple process for you to get your title. It could be a bonded title, it could be a Vermont title, it could be a court-ordered title. All of those things are do-it-yourself processes that cost very little, usually less than $100—$70 or $80 in most cases. For you to get your title might require filling out some paperwork, might require mailing some things off, but researching the method and finding out that method allows you to pay a very small fee to get a solution to your vehicle title problem.
How to Get a Lien Release for a Vehicle Title
So how do you get a lien release for a vehicle title if you have a car that needs to get a title and there’s a lien holder showing on that title record with the DMV?
The title normally won’t be released until you have that lien cleared from the title records. Some of the complications could be if the lien holder’s out of business or if the car’s not fully paid off, or if it’s an automax type car title loan.
In those cases, you have to go through a certain process. If the lien holder is out of business, you have to find out where they transfer their assets to.
If the car is not paid off, you might want to do a lien mitigation to have the lien discounted to an amount that’s palatable.
If it’s a title pawn, you may find that loan’s not even recorded on the title so there might be a duplicate title possible.
In other cases, if there’s any trouble finding the lien holder finding where they are, you can maybe get a letter of not interest from the bank listed on the title which will be the same as a lien release.
Sometimes if you have payoff documents from the bank showing that it was paid off on a certain day, the DMV may accept them.
So a court-ordered title is your last resort but if the car title loan is more than ten years old sometimes a court-ordered title may be the way to go.
So how do you get in contact with a prior owner of a vehicle to help you get a title?
Get the name and identityYou need to do three steps. First, you need to get the name and identity of that person.
Find their current location.The next thing you need to do is find out their current location because, in some cases, the title record for that person might be an old address where they’ve moved from, and now that they live somewhere else, you have to find out where they are now.
Contact Them and What to SayThe third thing you need to do is know how to contact them and what to say. If you want to ask somebody about a car they may have owned years ago to help you out with paperwork and that’s not approached correctly, it may backfire, and they may not help you at all.
Federal Law: The DPPASo how do you get the information? Well, there is a federal law called the DPP that prevents the release of some of that information except for very specific scenarios, and your scenario may qualify for that, but you have to apply for it correctly.
Alternative MethodsAnother way to look for it is to look for old papers inside the car, maybe oil change receipts, maybe underneath the car, maybe an old purchase order, buyers order, even a plate frame, oil change receipts from an oil change company, or the tag on the windshield might help you find the owner.
Need Help? Contact UsIf you have difficulty finding a prior owner, you can call us up or reach us through cartitles.com, and we can find some solutions that might help you get in contact with that prior owner.
So what’s the process for getting a new car title?
Scenario AssessmentWell, you have to look at the scenario to see which of the processes you have to go through.
True Duplicate TitleIf it’s a true duplicate, meaning that you are the title owner and it was in your name, you just need to get another copy. That’s an easy process. You go to the DMV, bring your driver’s license to the VIN number, and they’ll take care of that for you.
Changing the Owner NameIf you’re changing the owner’s name on the vehicle, you may need other documentation. You might have to remove a lien holder if there’s an old lien holder on the car. Look first at what documents you have: a bill of sale, a receipt, or any other documentation showing the vehicle’s transfer to you.
Locating the Prior OwnerYou may have to locate the prior owner to get some of these things signed, which may be part of the process of getting a new title.
Recent Purchase ConsiderationsIf you bought the car recently, you want to take a look to see if you bought it from a dealer or private seller, and even though somebody may have seemed like a dealer, sometimes there’s people who sell cars out of the blue that aren’t really legitimate licensed dealers; they’re just individuals who flip cars from the driveway or from some car lot somewhere.
Paper Trail and Chain of TitleSo check to see if it was a dealer or a private seller, and if there is, what’s the paper trail and what’s the chain of title that you have putting the car in your name?
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