How Digital Car Titles Are Doing

So many of you have asked how exactly are we working on getting vehicle titles easier to get so they’re not, you know, paper documents old school and they’re more electronic. Well, as part of the eART Coalition, we are working state by state tirelessly to get states to get electronic titles. And here’s an example of how that works. This is a directive we’re working on with the state of Massachusetts, and here’s all the gatekeepers and the stakeholders that are working on this. Here’s us right here, car titles, you see.

Stakeholders Involved
And you also have ADESA, one of the largest auto auctions. You have TRAR, which is a major automotive company. You have Copart, which is a salvage auction. A lot of major players in the automotive and document industry, and we put together a project with each state based on what their rules are. This particular inquiry went directly to the lieutenant governor of Massachusetts, and it says under signatories, we would like to request your support in directing the registry of motor vehicles.

The Role of RMV
The RMV, that’s what they call it in Massachusetts, the registry, not the department, to adopt necessary rules or policies to facilitate the acceptance of electronic signatures on all documents required to complete motor vehicle title transactions. It’s real simple. And then we put the supporting information, we put all the different benefits.

State-Specific Title Processes
It’s tedious because we have to do it one state at a time. It’s not like there’s a national title system; every state has a separate vehicle title process. So this is how we do it: we go through the state’s rules and regulations, find out who handles it, put together a package for them, and also offer support.

Third-Party Involvement
As they’re doing this, they might need programming, they might need knowledge of other states, they might need information from third-party vendors like the companies you see on this list. All of those companies are involved with the title process, and the states want to make sure that third-party vendors are also part of the solution. So each of us are committed as a company to providing support for the state to be able to do this but also to make it easy for them to do it so that there’s no friction in this changeover.

Success in the Works
So this is how we’re working on it. It’s happening behind the scenes. It may take a few years to have this all done, but we’re doing it one state at a time. It’s been very successful. As you probably remember from previous reading, the state of California put a lot of their titles on the blockchain, which is a great start. And other states are doing the same thing. We will not stop until we make it easier for consumers to get titles for vehicles because we know how hard it is.

The Goal for Consumers
We know what kind of problems you have getting titles for vehicles. At the moment, we try to make it easier by being able to do the paperwork for you if you want, but in the long run, we want to make it easier for everybody so you don’t need to have that kind of professional assistance just to get a title for a car. Because if it’s your car, you’re supposed to have a title.

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The Difference Between A Lien And A Title For A Vehicle

Title vs. Lien
So in the course of determining ownership of a vehicle, many times the phrase title versus lien comes up in the conversation. So what is the difference between a title of a vehicle and a lien on a vehicle? Well, a vehicle title is a certificate, it’s a legal government document, looks like this, that is issued by a government agency. In most states, that agency is called the Department of Motor Vehicle or Motor Vehicle Department. Sometimes it’s called the Department of Transportation. Some states have a different name like Secretary of State.

State Agencies and Titles
Either way, every state has a government authority that issues titles. It’s not a document you can buy from a company. You can’t print one out from the internet, can’t download a document. It’s a physical document, it’s kind of like a $100 bill, right? You can’t print a $100 bill from the internet.

What is a Lien?
What is a lien? Well, a lien is a claim against the title. So if you have a title for a vehicle and it has your name on it as the owner, if you borrowed money against that vehicle either when you purchased it or later on, there will be a section down here for lien holder where it’ll be filled in the name of that lien holder. The lien holder puts their name on the title record to protect their interest, to make sure basically they get paid back, and make sure that you pay the notes on that car. In order for you to get that title document in your hands, you have to have that lien removed from the title record. That’s called a lien release.

Lien Release and Title Document
If the lien is showing on the title record, in most states the Department of Motor Vehicles cannot give you the title. In fact, the lien holder, the bank, the lender, is probably holding on to that paper certificate. And when you pay them their last payment, then they give that to you.

Lien Controversy: Failure to Notify DMV
So what is the big controversy about liens and lien releases? Well, here’s what happens. Many times when a lien is no longer active, whether it’s paid off, whether it’s a charge off, a write-off, bankruptcy, or some other type of dissolution, the lien holder does not give any notice to the title authority, to the Department of Motor Vehicles.

Lien Holder Process
If you pay off the loan, all they’re going to do is take that title certificate they have in their file cabinet, stamp it paid, sign it, and mail it to you. They will not update the records at the Department of Motor Vehicles. As far as they’re concerned, there’s still a lien on the vehicle. The lender figures, well, you have the title, we signed it, so you’re good.

Cost of Filing Lien Releases
Why wouldn’t the lien holder just tell the DMV the lien is cleared? Well, here’s why: it costs money. In order to file a lien release, they have to pay a fee. It might only be 10 or 15 or 20 dollars, but imagine doing that a thousand times a day for all your customers. It’s $20,000 a day, it’s $100,000 a week, that’s $5 million a year. If they could save that money by not doing lien releases, that’s free money in their pocket.

Problems Without Lien Release
Plus now they have to have extra employees that do these filings, send them in. They’re saving a lot of money. So they figure they send you the title, it’s stamped paid, you’re good. Well, what happens if you lose that title? Well, then that’s a problem. Or what happens if another person buys that car and the title doesn’t go with it? That’s a problem because now, as far as the DMV is concerned, there’s still a lien showing.

Other Issues with Liens
What happens if you have a charge-off or a write-off? Well, the DMV definitely doesn’t hear about that. The lender is not going to tell them about a charge-off or a write-off, and that car is going to be encumbered, it’s going to be blocked until that’s cleared.

How to Remove a Lien
So how do you get the lien removed? Well, there are only two people in the entire world that can sign a document to remove that lien. One is the lien holder, the other is a magistrate or a judge. So here’s how you do it. First, send a lien release request package to the lien holder. Don’t try to do this by phone, don’t try to do it by email, don’t try to do it by any kind of message. Send a package.

Lien Release Package
Here’s an example of a lien release package. It’s got a bunch of documents in it, put it all together—a lien release, a letter of non-interest, a declaration, an affidavit. Four documents. Send it by mail to the lien holder. Don’t email it, don’t scan it, don’t text message it, put it on a piece of paper.

Why Mailing is Important
Here’s why: that lien holder company, and you’ve heard us say this before, does not have a team of people. They do not have a department of people sitting around waiting to do lien releases for people. Everybody in that company has another job, they’re working on some other task.

Making it Easier for the Lien Holder
So if you just call them up and say, “Hey, give me a lien release,” yeah sure, whatever. They have other jobs to do. They’re not going to go find—think about how long it takes to find these papers. In fact, when we do lien releases for customers, half the job is finding all the right forms, not so much filling them in, it’s finding the right ones.

Facilitating the Process
The lien holder is definitely not going to do it. So if you want to do it for them, that will get it done faster. Get all the right documents and then fill them in. Put the VIN number, your name, your address, all the details so they don’t have to do any work.

The Importance of Minimizing Their Effort
Because as soon as that lien holder has to do any kind of work, they’re going to just forget it. They might tell you they’ll do it, but they never will. Sometimes they’ll even tell you, “We’re not doing this.” You want to mail it to the lien holder, and when you mail it to them, go the extra step. Put a return envelope in that mailer, that’s what we do. Put a return envelope already filled out with your name and address and a stamp.

Ensuring Smooth Processing
So literally that employee at the lien company, all they have to do is sign it, put it in the envelope, there’s already a stamp, put it out in the mail. They don’t have to do any work. They don’t have to find an envelope, find a stamp, go to the mailroom, anything. As soon as they have to do any kind of work, they’re just going to forget about the whole thing.

Dealing with Complex Cases
Also, if there’s any kind of gray area about that lien—if it’s a charge-off, if it’s a write-off—if they can just pull it up in the system, they type in your VIN number, oh, write-off, sign it, boom, send it. If they have to do research, find documents, that might keep them from giving you your lien release.

Lien and Title: Final Clarification
So remember, a lien and a title are two different things. A lien is a claim against the title. A title is the ownership of the vehicle. Also, a very common misconception—if you borrow money from a bank to buy a car, they’re not the owner of the car, you are the legal owner. They’re just a lien holder, they have a claim against it, but the car is yours. You own it.

Court Process for Lien Release
So as soon as you get that lien released, whether it’s through bankruptcy, charge-off, write-off, signed release, that car is yours. Now what happens if you mail the package to the lien holder and they don’t reply, they don’t respond? Well then, what you can do is file a petition to the court in the county where you reside. It’s called a court-ordered title.

Court-Ordered Title
You’re asking the court to declare you to be the owner of the vehicle free and clear based on a court order. You have to show them, “Look, I reached out to the lien holder in writing, they refused to comply, they didn’t object to it, they didn’t come get the vehicle, they didn’t do anything, so they’re abandoning the vehicle to me. I want you, the court, to make me the owner.” And then they can sign the lien release. If they sign it, it’s as good as gold.

Conclusion: Lien and Title Differences
Those are the differences between the two. Don’t confuse lien and title, two different things. If you have a vehicle that has a lien on the title record, you have to clear that up first before you get a title, even if it’s not your lien, even if it’s somebody else’s.

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Can You Get A Kentucky Red Title

Kentucky Red Titles
So what is a Kentucky red title? We get a lot of calls from people who are looking to get a title for a vehicle, and what they’ve obtained from the last owner is a Kentucky red title—or maybe they didn’t even get it; they just found out that’s what’s on it. Here’s what happens: If a vehicle has been declared a parts-only vehicle or non-repairable vehicle, most states don’t give anything for it. They might give you a title that says “non-repairable,” they might give you a “junk title” or “parts-only title.” In Kentucky, they give you a document that just says “title,” but it doesn’t say “parts only,” it doesn’t say “non-repairable”—it just says “Kentucky title,” and it’s red.

Eligibility and Restrictions
The problem is that vehicle is not eligible for title or registration in any state. It’s been declared a parts-only, non-repairable vehicle, and federal law doesn’t allow it to be titled in any state. But Kentucky gave this document for ownership just to prove ownership. A really good description of this comes from the Tennessee Department of Revenue, and the reason Tennessee has this on their website is because Tennessee is right next to Kentucky, so a lot of people try to go from Kentucky to Tennessee with these vehicles to get them on the road.

Tennessee’s Stance on Kentucky Red Titles
What does Tennessee say? They say that a Kentucky red title is the equivalent of a non-repairable certificate. Vehicles that are issued Kentucky red titles or Tennessee non-repairable titles are damaged beyond repair and would not meet Federal Motor Vehicle Safety standards for road operation. A vehicle that is issued a Kentucky red title may not be registered in Tennessee. This is the same as every other state that doesn’t give out titles or registrations for these vehicles.

Warnings and Buyer Caution
So, if somebody’s trying to sell you a Kentucky red title, be very wary. And also, if you’re not a resident of Kentucky, you can’t put it on the road because it’s not allowed to be driven—they consider the condition to be poor. Now, you may say, “Hey, my car is fine, there’s nothing wrong with it.” That doesn’t matter. At some point in its history, an insurance company decided they don’t want this car back on the road for whatever reason, and it doesn’t matter what their reason was. It may just have been that they just don’t want it for liability.

Final Thoughts and Precautions
So, that car is not eligible to get a title. Beware of Kentucky red titles; they’re the same as a non-repairable, junk, parts-only, or certificate of destruction. Every state calls it something different, so don’t try to buy one unless you’re 100% sure that you can take it apart and get money back from selling the parts.

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What Are The Easy States To Get A Vehicle Title?

Car Registration Challenges
So the question comes up quite a bit what is the best state to register and title your car in a lot of people ask what’s the easiest state that I can use to title my car if you have a vehicle you’ve purchased without a title and you’re running into problems in your state many times the instinct is to try to pick another state to use to title or register your car and at first this might seem like a good idea the problem is a lot of people think oh my State’s really hard my State’s the hardest state.

Misconceptions About State Difficulty
To title A Car the hardest state to register a car and the only reason that they have that opinion is because it’s really the only state they’ve had any experience with most people have never tried to title or register a car in another state they may have heard things through the grapevine or on some U web Forum or social media that other states are easy they might have heard loopholes about Vermont or Montana or other states here’s the problem every state has rules about how to get a title in registration guess where those rules.

Understanding the Source of Title Rules
Come From it comes from the federal government even though titles and registrations you know titles like this as certificate are issued by the state it’s not the state that makes up the rules they’re just the ones who enforce the rules execute the rules the rules Come From the federal government and all states have to abide by the rules all states use the same criteria the most basic one is in order to get a new title for a vehicle you’re supposed to have the old title signed over to you or a couple other options some states.

Options for Obtaining a Title
Allow you to do a bonded title with aity Bond some states allow you to do a court order title but no states allow you to do a title with just a bill of sale and you might say well I heard Vermont did a bill of sale well Vermont used to do a registration with a bill a sale they didn’t give you a title they gave you a license plate so no States ever gave titles with bill of sale because the federal law doesn’t allow it so why are people using loopholes well for the most part the reason that people use loopholes is to.

Reasons for Using Loopholes
Try to avoid and evade other things like taxes the reason people use Montana llc’s is to do tax evasion and if you register or title a car and Montana you don’t have to pay sales tax so that could save you a lot of money the problem is if you are a resident of let’s say California and you decide I’m going to go to Montana and register my car there so I don’t pay tax two things are going to happen first no state is allowed to give a title to a person who is a nonresident so if you’re not a resident.

Issues with Nonresident Titles
Your driver’s license is not from Montana they’re not going to give you a title so what people do is they form an LLC they form a corporation in Montana put the title in the corporation name and then drive it around with a Montana license plate so first you have to form that corporation which is not that hard to do doesn’t cost that much you know three 400 bucks the problem is whatever state you’re driving in California Texas Illinois New York whatever you’re driving around with your car with a Montana license plate now.

Risks of Driving with Out-of-State Plates
There’s no law against driving it in another state but states that are notorious for tax evasion like Montana that license plate is going to stick out like a sore thumb and there are what’s called alprs automated license plate readers all over the country they’re on police cars they’re on tow trucks they’re on parking lots they’re on street signs that read every plate that goes by and it runs plates if it sees a Montana plate it’s going to run that plate and if it sees it it comes back to an LLC that’s a red.

Consequences of LLC Registrations
Flag and and they’re going to look at the name on the LLC and if that name is a resident of the state there are counties right now in New York and California and other states as well that are actively searching for Montana license plates they back search the corporation they find the name and they look to see if you’re a resident of their state even if they don’t find that if they see the same license plate go past that alpr reader at a certain parking lot a certain street sign a certain intersection every every day on your way.

Increased Scrutiny from Authorities
To work they’re going to pull you over and if they see you driving with a California license in a Montana license plate they’re going to refer you to the in California um it’s called the Franchise Tax Board every state has a taxing Authority that collects sales tax you will be back in your reading in just a few seconds in the meantime remember that actual human.com offers you live one-on-one private video consultation with an expert in this exact subject we want to listen to your story we want to.

Consultation Services Available
Hear your questions we want to give you expert advisement of your options and tell you what we know about your particular situation now back to your reading and they’re going to refer you for an investigation and people are being fined there some people are even having criminal records because of this what’s another reason you might want to go out of state well because maybe your car won’t pass inspection in your state maybe your state has smog inspection safety inspection and your car is not going to pass if you register a car in.

Avoiding State Inspections
Another state to avoid inspection same thing’s going to happen it’s going to be found out and your car will be impounded because it’s not safe for the road another big problem with an out of state loophole is insurance when you go to your insurance agent to purchase an insurance policy for your vehicle you have to tell them what’s called a garaging address now that doesn’t mean you have to have a garage where where you park your car it just means you have to tell them where your car is most of the time so let’s say if you do a.

Insurance Challenges with Out-of-State Registration
Montana LLC where are you going to tell them the garaging address is if you tell them it’s in Montana that matches the LLC okay great here’s your policy but if you’re driving around in Illinois all the time and God forbid something happens to your car it’s in an accident it injures somebody it’s stolen it’s damaged even if you if somebody else crashes into to you and it’s their fault they’re going to look at the garaging address and say your car is not supposed to be in Illinois all the time it’s supposed to.

The Importance of Accurate Garaging Address
Be in Montana what were you doing in Illinois your driver’s license is Illinois your employment is Illinois why why were you in Illinois you can’t just say well I was just here on the weekend they’re going to ask you prove show records where that car was in Montana or they’re going to deny your claim and you’re out that money or you can give them your address in Illinois where you live on your policy and then they’re going to ask you well why are you titling it in Montana what’s the reason for it and.

Potential Claim Denials
They might not ensure your vehicle because it doesn’t match it’s what’s called a um fraudulent jurisdiction they’re going to think that there’s higher risk involved with that policy because you’re titling in one place register another place living in the third place it’s not going to match up so insurance is going to be another problem that most people don’t think about now what’s the easiest State easiest state is the state you live in because all the states have the same rules for titling and registration every.

The Easiest State to Title Your Car
State has a method you could use to get a title whether it’s a bonded title court order title VT transfer prior on a contact there’s many methods you could use all of those methods are easier cheaper and faster than going to some out ofate place they always are easier cheaper and faster so don’t feel like you have to go out of state to get a title um it’s not going to save you any money it’s not going to it’s going to take longer because you have to deal with the other state and even if you decide to do it at some point there may.

Considerations for Out-of-State Titles
Be liability because of taxes or insurance or other factors now some people just feel like they have to go out of state because they want to feel like they’re getting away with something that’s fine but just realize that your own personal interest in getting away with something is going to cost you time money and everything else now the good news is this getting a title is not that hard if you walk into DMV without a title and say give me a title they’re going to tell you they can’t help you because they don’t have the in the.

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Could You Lose Your Car Over A Crime You Did Not Commit?

Tesla Vehicle Impound Due to Unrelated Crimes
So you may have seen this news going around. I want to hear what you all as car enthusiasts think about this. Tesla owners have been losing their vehicles to police impounds due to crimes they had nothing to do with. How this is playing out is Tesla’s, like some other vehicles (Tesla’s not the only car that has this), have exterior vehicle monitoring that watches around the car using cameras even when the car’s turned off. Some manufacturers call it 360-degree visibility, some call it monitoring mode, and some call it Sentry mode. But what happens is there’s cameras outside the vehicles—in mirrors, door handles, and certain parts of the car—that watch what’s going on around the car. That way, if somebody bumps into your car in a parking lot and you’re not there, you know who it is. Somebody tries to break into your car, you know who it is. Somebody scratches your car with a key, you know who it is. These monitoring systems are very convenient, so you know what’s going on. In some vehicles, you can watch it from your phone. But what’s happening is just like a ring doorbell camera.

Car Cameras as Evidence
If there’s a crime committed in view of one of these cameras, now that becomes evidence. So what’s happening? If there’s a major crime, someone gets robbed or assaulted or murdered, or something really bad happens in a parking lot or in a street, the police, as part of their investigation, are going to look to see if there were any Teslas around. And if there were, they’re going to contact the owner and say, “We need your car because your car has evidence. It’s got a recording of a crime, it’s got a record of a perpetrator or a criminal, and we need to get it.”

Police Impound for Evidence
As of right now, the police need to have the whole car. They can’t just plug in something and download the video; they don’t have that technology at this point. So they tow your car, and because it’s a criminal case, they may need to keep the car for evidence. The lawyers can inspect it, validate it, and also, as you know, the Fifth Amendment of an accused person gives them the right to cross-examine their witness. That doesn’t mean just asking the witness questions. It means if the witness is technology, you have to be able to evaluate it, inspect it, and have a forensic scientist go through it.

Length of Car Seizure and No Compensation
So they may need to keep the car so the defense can verify that this was a correct recording. How long is your car gone for? Who knows. And they don’t give you a rental car. It’s not like when you bring your car to a dealership for an oil change and they give you another car to drive. This is a car out of your hands. It’s not just Tesla—Tesla is the most prominent—but many cars, even some minivans, have 360° cameras that look around the car for parking.

Challenges and Risks for Car Owners
What are your thoughts on this as an automotive enthusiast? Is this a good thing to have in cars? And what’s the solution, what’s the answer? If you have one of these, how do you keep this from happening to you? You don’t have any control over it. You don’t know that there’s not going to be a major crime or some event happening near your car that you had nothing to do with, and now your car’s gone.

Comparing Vehicle to Ring Doorbell Camera
Ring doorbell cameras—this has been happening for years, but not having your ring doorbell camera doesn’t change your life. You can go get another one and put it on your wall. But Tesla as a vehicle is your way of getting back and forth to work or to the store or wherever you need to go, and that could be a serious problem for you.

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