So if you’ve been looking at cars to buy new or used for the last year or two you found that first of all there are a lot of inventory shortages and the prices are high. People have been waiting for a long time for prices to come down, thinking that maybe interest rates are higher or that there’s a recession happening that prices might come down. Well according to Barron’s and many other sources, inventories are coming up. There is more availability of vehicles but there’s not going to be any price reduction to especially on new cars. Why is that? Doesn’t supply and demand kick in and make prices go down? Well, let’s take a look at four reasons why new car prices are not going to come down.
First, there’s still big demand even though the prices are higher. In fact, People are paying a thousand dollars a month for car payments because of interest rates and prices. There’s still a very big demand for new vehicles so it’s not that. There’s a lot of inventory glut where car dealerships can’t get rid of cars So there’s still a big demand and that’s gonna keep prices high.
The second thing is manufacturers and dealers are getting used to being able to make a profit with lower volume. It used to be the dealer scrambled for every last sale selling 300-500 cars a month to try to pay all their bills and have a profit for the dealership and manufacturers. They strove to sell 12 or 14 million cars a year for the U S market. Well, now they’ve learned how to make money selling fewer cars. You have a little more margin, you do less advertising, you have less overhead, you have less interest on your inventory, and you could make money selling fewer cars and it’s less work. If you only have to sell a hundred cars a month that’s a few a day. If you have to sell 500 cars a month, well now you have to sell 10-15 cars a day. It’s a lot harder of a scramble to sell high volumes of vehicles. So dealers and manufacturers are both learning, “Gee, we don’t have to sell as many cars. We just don’t have to discount them as much. Put a fixed price on them, MSRP, and sell them for that and we’ll make money.”
Number three, the other thing is manufacturers are not putting a lot of money into creating new inventory. Here’s why. Within the next four to five or six years there’s going to be a huge switch to electric vehicles. Many states are making it illegal to sell gas-powered vehicles in their states, California, New York, and Washington state are three examples of states that said after 2028-2030, you can’t sell gas vehicles. So manufacturers are not going to be putting money into R&D and production of newer model vehicles. Lead times on coming out with a new model are three to four years, so whatever models are being made right now that’s going to be it for gasoline vehicles. So why put a lot of investment into new vehicles if you’re going to have to just come out with electric vehicles anyways?
Here’s reason number four, this is a big deal. The cost of producing a vehicle is much higher and you might think, well isn’t that supply chain inflation? That’s a big part of it. Still getting sheet metal engines, manufactured goods, and components are all higher. Inflation doesn’t just affect you at the gas pump or at the grocery store, it affects the car manufacturer and their production plant. But more than that they are having trouble getting workers, getting employees to build these vehicles is harder and you have to pay more. The cost of manufacturing a vehicle has gone way up now in order to get a halfway decent vehicle of any substantial kind, not even luxury but just a nice vehicle. It’s going to be $40-$45,000. The days of a $20-$30,000 vehicle are over. There are still a few that are in that range, but they’re very limited models. Stripped out vehicles. You’re going to be spending $40-$45,000 anyways to get a decent car. In most manufacturers, that’s going to put you at a payment of $800-$900 bucks a month. So people are getting used to that. A large percentage of car buyers are now paying over a thousand dollars a month for their car payments. The fact that now that’s been baked into the system, dealerships and manufacturers can be more comfortable with presenting that payment to customers.
So prices aren’t going to come down on new vehicles anytime soon. Also, there won’t be huge discounts on new vehicles there won’t be $2,000 rebates or $2,000 dealer discounts, or other large, opportunities for reductions in price. So new vehicles are going to be pegged where they are. It’s not going to come down, now used vehicles are a different story. If there’s a big glut of used cars coming into the market that might lower them but they may not be the cars you want. If they’re 60 or 70,000-mile cars they’re out of warranty. You might not want that car because manufacturers are now building cars that they know are going to be replaced in three or four years with EVs. Why build them where they’re going to last a long time? Why put the same amount of reliability into a car that you know you don’t have to really warranty because people aren’t going to be looking for a replacement for that car? In four or five years they’re going to want or have to buy an EV. So new vehicle prices are where they are. They’re not going to come down, expect us to pay $800-$900 bucks a month for a car payment. If you really are looking for a bargain, look at maybe a late model used that you can keep for three or four years until you get forced into an electric vehicle.
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Order Vermont Title LoopholeOrder Deceased Owner Title TransferOrder Bonded Title ProcessOrder Abandoned Vehicle ProcessOrder Prior Owner ContactOrder Lien Release Request LetterPGlmcmFtZSBzcmM9Imh0dHBzOi8vYXBwLmFjdWl0eXNjaGVkdWxpbmcuY29tL3NjaGVkdWxlLnBocD9vd25lcj0xOTQ4ODEyNiZhcHBvaW50bWVudFR5cGU9MjMwNjY0MTAiIHRpdGxlPSJTY2hlZHVsZSBBcHBvaW50bWVudCIgd2lkdGg9IjEwMCUiIGhlaWdodD0iODAwIiBmcmFtZUJvcmRlcj0iMCI+PC9pZnJhbWU+PHNjcmlwdCBzcmM9Imh0dHBzOi8vZW1iZWQuYWN1aXR5c2NoZWR1bGluZy5jb20vanMvZW1iZWQuanMiIHR5cGU9InRleHQvamF2YXNjcmlwdCI+PC9zY3JpcHQ+
Every week we sit down with our customer service representatives and our sales staff and ask them “what are the most unusual questions that we’ve heard from callers or inquiries to our company?” And this week one of the ones that came up was what do you do about notifying a sale or forcing a sale of a vehicle that you sold but the buyer does not transfer the title.
This comes up a lot when you sell a car on Craigslist or eBay or some other private sale and you give the title to the buyer. If they don’t put it in their name right away some sellers worry that they have liability or they can get in trouble if the car is used in a crime or gets in an accident or gets parking tickets. So it is important that you want to get that transfer done. Now, the buyer by law is supposed to apply for a new title in their name within a certain period of time, but what if they don’t do it? What if they don’t follow through on what they’re required to do? How does that affect you? Do you have liability? Can you get in trouble? Because technically, as far as the DMV and the police are concerned, it’s on you, right?
Here are some suggestions on how to make sure that your vehicle transfer doesn’t come back to haunt you.
First of all, when you sell a vehicle, in most states the license plate does not go with the vehicle. So you want to take the license plates off the vehicle. The title and registration are two different things. The title is who the owner(s) are, and the registration or the license plate is what allows you to drive it. So if you’re in a state where the license plates don’t stay with the vehicle make sure you take them off. Don’t let the person just say Hey, I want to use it to drive home and I’ll send them back to you because now you’re giving that person your license plate to drive around with. If they get tickets if they go through red lights if they go through toll booths, the ticket is going to come back to you. So take off your license plates. In a few states, the license plate goes with the car.
The second thing to do is to make sure that you actually sign the back of the title and put the name of the buyer. Do not sign an open title. A lot of times the buyer will say Well, I’ll just sign it and I’ll put the name in later cause I might put it in somebody else’s name. Don’t sign an open title. Put the name of the buyer on that title. In fact, most states require that you do this it’ll say right on the title you have to put the name you can’t sign it blank. In addition, look at the ID of the person that’s buying it, and make sure you write down their name and address so you know who actually is buying the car from you. You want to have a record of that transaction. Prepare a bill of sale for the transfer. You sign it and have the buyer sign it. Keep a copy, maybe make two. You keep one they keep one, or if you only make one, take a picture of it and make a photocopy or whatever you want to do. And make sure you have a copy of the front and back of your title at the time of transfer, that’s all you can do: license plate, bill of sale, copy of the title, and write down their ID.
Now, once the sale’s completed you next want to go to your state’s DMV and get a notice of sale or notice of transfer or affidavit of transfer. Every state or most states have a form like this that you can submit this form to get the vehicle on notice that it’s no longer yours. So God forbid anything happens with that vehicle, if somebody uses it in a drive-by or a bank robbery, the police or the DMV are not going to come looking for you because they’ve already been made aware that the vehicle is not yours. So what says right here is if you sell a transfer of a motor vehicle you must submit this notice within 30 days. Well, guess what? In this state it’s required, whether the buyer puts it in their name or not as a seller you’re required to make a notification. Complete the section and sign the notice. Mail it to the address at the bottom. Keep a copy for your records. Failure to complete the required blocks will result in the notice not being processed.
The reason you want to do that is that first of all in some states it’s required by law. But more importantly, it puts the department of motor vehicles or in this case, the DOR department of revenue whoever issues titles, on notice that you are no longer the owner of that vehicle. You sold it. If the new owner puts it in their name or applies for a title or not, not your problem. Sometimes buyers don’t even get a title. They go out of state. Maybe your buyer is moving to another state or they go to another state. If you don’t file this notice your home state will never know you sold the vehicle. So find that notice of transfer. Make a copy of your bill of sale. Submit that with it. If you can’t find a form for your state, go down to the department of motor vehicles in person. Don’t try to do it by phone. Don’t try to do it by email. Go in person with your photo ID, the bill of sale with your VIN number, and tell them, look, I sold this vehicle, how do I get out of my name? Because you want to avoid liability.
If you’re concerned about what your liability might be you may want to contact an attorney. We can’t give you legal advice or give legal-type instructions, but you do want to make sure that any vehicle ownership is disclaimed by you. Once you don’t have control of the vehicle, you don’t know where it’s been where it’s going or what it’s doing what liability or costs it’s incurring. So you want to make that notice public and put it with the DMV. That’s the most common question for this week. Look for future videos and put your comments below. If you have questions about unusual title scenarios we can answer them for you.
If you leased a vehicle in the last three years you may have found that that turned out to be a very smart money move and here’s why…
When you lease a vehicle for 2-4 years you make payments but at the end of that term, you can just walk away from the vehicle rather than having another two or three years worth of payments. Where now, the car is out of warranty and may have high miles, or you may just want another car. Most people only keep cars for two or three years anyways and then flip them to a new car. If you financed it, you probably would owe more money than it’s worth but if you lease the vehicle, at the end of that three years you walk back, drop off the keys, and you walk away. Now, you also have the option to purchase the vehicle.
At the beginning of the lease, you are given a written, documented contracted etched-in-stone option where you can buy it for a fixed amount. Usually, for a three-year lease, it’s about half of what the original price was. So if you buy a $50,000 car at the end of three years after you’ve made your payments you can either walk away. Or pay half the value of the car and own it. Up until the last couple of years, the lease companies guessed pretty well as to what the value is going to be in three years and it was almost a breakeven. So if your buyout option was $25,000, the car was probably worth $25,000. In fact, in some cases, the buyout option was more than the current value because lease companies and manufacturers sometimes artificially goosed up that number to give you a lower payment. In a way that discounted the car without making it seem like it was a bargain. For example, if you’re leasing a BMW or you’re going to buy a BMW and they had big stickers in the window that said $2,000 rebate 0% financing and all kinds of balloons and carnival acts, you might not think that BMW is really that prestigious of a brand if they have all these discounts flying around. A lot of manufacturers even the discounted and lower-end cars got away from this circus act of discounting. What they did instead was they put the discount built into a lease so they could just offer you a lower payment. And it was a way to discount the vehicle without having to make it look like blue light special, right? So what that did was artificially raised up the residual and the advantage of the manufacturer is if you bought off the vehicle they never lost that money.
But here’s the thing, over the last two years or so used car values have gone through the roof. So many people get to the end of their lease and realize that their buyout is way less than the market value. In fact, that car that you have a buyout of $30,000 or $25,000 might be worth $31,000 or $32,000. So if you buy it you’re already making money. Even if you don’t want to keep the car if you buy it and then resell it you could pocket the difference. Or if you are going to get a new car anyways, instead of doing a lease turn-in, do a lease trade-in. A little bit different scenario with just one word. A lease turn-in is you walk away, drop off the keys and you’re done. A lease trade-in is you use that lease residual as a trade-in toward your next car. So if it’s worth $30K and the buyout was $25K, that $5,000 equity goes towards your next car. So buying out that lease is a very smart financial move if the residual value is lower than the market value. And in many cases, it is with this current market.
Now going forward, if you lease a car today, that might not be the case three years from now. So don’t make this a motivation to lease a new car right now might not be the same thing in two or three years but right now is a sweet spot. If you leased the car from 2018-2020, and your lease is up or coming up definitely check out residual and make sure the paperwork is done. It’s a little bit of a tricky scenario buying out your lease because it’s not a lien where you do a lien payoff you’re doing a lease buyout where it transfers ownership, and you have to make sure that’s done correctly, but at lease by out could be a way to add equity to your next purchase or just simply put cash in your pocket.
You know vehicle inspections and VIN verifications and DMV procedures may seem bureaucratic but here’s one of the reasons why it’s necessary. In Miami, there was a group of people who were stealing vehicles and using some DMV paperwork loopholes to try to get away with auto theft. They arrested many people for stealing a million dollars worth of cars in Miami. How were they doing it?
Well, this system was organized criminals that would rent cars out or get cars by other means meaning that they would somehow get possession of the car. Now possession of the car isn’t enough to get ownership. If you rent a car from Hertz or Avis or Enterprise it doesn’t mean you own it. If you take a car for a test drive from a dealership, you don’t own it. But if you can get a car in your possession or borrow from somebody then you have the chance to do what’s called re-vinning. Where you take off the VIN that’s on the dashboard and put on another VIN that’s not of the vehicle that you rented and then you try to resell them. Some they sold through a dealership. Some they tried to export. Now the problem with that is, the VIN that’s on the dashboard isn’t the only VIN placement on the car on some cars there are 12-14 different VIN placements scattered around the car. Many of them are hidden and only a police officer or the police department knows where they are. So you can’t replace them all anyways.
These stolen cars had falsified titles and they were sold to dealerships like AutoNation. AutoNation sold some of these cars unknowingly, they didn’t do anything wrong, they got a legitimate title they bought them, and they ended up selling stolen cards which you have to buy back. According to the article.
You should be careful when you buy a car to double and triple check the paperwork and that might help. However, this paperwork was done pretty thoroughly. Matter of fact, a vehicle title is not something you can print up on a home computer or something that has a lot of features come from the DMV. So if the DMV issues a title with a VIN on it you might think that that’s legitimate. But you might want to look at some of the second or third VIN placements on the vehicle. Now the one on the dashboard is attached with a tamper-proof rivet. So in theory, you shouldn’t be able to take one off and put one on unless you tamper with those rivets. But some of the thieves know how to make the rivets look correct. So if you’re buying a high-end vehicle and the person you’re buying it from maybe has some red flags maybe their name doesn’t show up on the title maybe the owner doesn’t appear to be, normal of how owners should be, maybe there’s no lien on a vehicle that’s one or two years old and why is the person selling it? You might want to look at some of the other VIN placements. If you look underneath, some of the VINs are accessible to civilians and you can find out if that number has been changed. Another thing you can do is if you plug in an OBD, vehicle evaluator, or diagnostic tool into the computer system the actual VIN of the vehicle will show up on the computer screen. So if you pull up on the navigation screen or in the infotainment system or plug in a diagnostic tool you can see the actual VIN of that vehicle. If it doesn’t match what is on the dash, that is a red flag. So this is a very good example of how sophisticated criminals are using the DMV system against itself to get titles for vehicles that they’ve stolen.
So here’s one of the most common questions that we get—a customer calls up and has a car that they did work on that they fixed up and they want to own the car. Maybe somebody gave it to them and they fixed it up. Maybe they repaired it for somebody and that person didn’t want the car anymore. Maybe they repaired it and fixed it, but the owner didn’t pay the bill. They didn’t want to pay for the repairs and just said to keep the car. Maybe you’re an auto shop that has customers bringing their cars in for repairs, maybe a body shop, and they don’t pay the bill or they don’t want to pay the bill, or an insurance company, and you want to dispose of that car. So the question is if you fix a car, can you keep it and get the title?
Well if you’re an automotive repair facility and have an automotive repair license it’s pretty straightforward—you can do a mechanics lien. Almost every state has a process that you can go through as a licensed automotive facility to take a customer order that has been placed for repairs and convert it into a title. There’s a step-by-step process for it. Every state does it differently. But what if you’re just a backyard mechanic or maybe just a private person that fixed the car? Can you keep a car just because you fixed it? Well, it’s a little more complicated.
The short answer is just because you fixed it doesn’t mean you automatically get to keep the car, but there may be ways that you can own the vehicle. First, consider options like a bonded title, court-ordered title, or other title recovery methods. All of those are methods that you can use to get ownership transferred to you for certain reasons. One of the reasons could be that you fix the car, you put money into it you put time into it you put parts into it. If that’s the case, you can use one of those processes. Now keep in mind that just because you fixed it by itself doesn’t mean you automatically get to own the car. You have to go through some steps because if the true legal owner of the vehicle objects to it, then you’re going to have to get somebody to decide who’s right. If you say Hey I fixed your car, and the owner says well it’s still my car. Who wins? That’s not up to you to decide, it’s not up to them to decide, it’s not even up to for the DMV to decide, or the title agency, it’s up to a court to decide. Here’s why that’s important.
If it was just as easy as saying Hey I fixed this car give me the car for free, anybody could just buy a set of $10 wiper blades put them on a car, and say Hey it’s my car. Right. So there has to be more to it than just I fixed a car. There has to be some decision-making process. Otherwise, no car would be safe. Somebody could see the car in your driveway, put on a new set of hubcaps, and say Hey I fixed it, it’s my car now. Right. Obviously, that’s a ridiculous example, but who’s to say what’s ridiculous and what’s not? Right. If you’re a licensed repair shop you’re going to have a signed repair order and a business license, you’re going to have all the proper documentation. If you’re just a backyard mechanic that fixed the car, look it’s your word against theirs. You say you fixed it you know you did, and the owner probably knows they did too, but who at the DMV is going to give you a free car just based on your say-so? Because if they would, anybody could get any car if they want it. So there has to be more to it than that. The court-ordered title process is the most definitive way to do this. Here’s why.
The department of motor vehicles or whatever agency in your state gives out titles, they only have a certain authority. They can’t give out titles based on a verbal request. They have to have certain documentation. They have to have either the old title or proper documents from a mechanics lien. If you don’t have that, the DMV can’t do anything. Even if they wanted to even if there was somebody there who liked you it was a nice person that wanted to give you a title, they can’t push a button and print a title unless they have the right paperwork. So a court order title can override the DMV. The court has authority over the DMV so if you get a paper from the court, boom slap it on the counter at DMV you get a title. So that would be one method that’s very definitive. You cut through all the red tape, you cut through all the bureaucracy of the DMV. It’s not that hard. You file a petition. You file an affidavit saying here look here’s what I did. And you probably have to do some title research. File with the court show up on a certain date that they tell you to with your documents. They’re going to make you raise your right hand under oath that everything’s true. If it seems like it checks out, they’ll give you a judgment of ownership. You walk right across the street to the DMV, and boom, slap it on the counter, you got a title. If you have limited documentation that you were supposed to fix the car, that’s the best way to go.
If you have more clear documentation I mean signed contracts, and paperwork, you might be able to go through the DMV through a bonded title. Now a lot of times people will ask well I have text messages I can show you on my phone. That’s not documentation because anybody could photoshop text messages. You can’t show your phone to the DMV and say this is a contract. Text messages on the phone I mean nothing. So forget about your text messages. If you have signed papers, different story. So if you have a vehicle that you’ve done work on, don’t give up hope. You may have gone to the DMV and tried to get a title and they threw you out, don’t quit. There are things you can do. In 42 out of 50 states, there’s a process called a bonded title, surety bond title, that you can use to get a title in cases like this. I can’t tell you how many times callers call our help desk and the agents there say why don’t you do a bonded title and they knew nothing about it. These are people that have been to the DMV or the title office in their state and their title office has never even told them about a bonded title. Sometimes the DMV doesn’t even know about it. It’s a legal process directly through the DMV. You don’t even have to go to court.
There are a lot of ways to work around this, but be forewarned don’t file for an abandoned title. An abandoned title and a bonded title sound the same but they’re two very different things. A bonded title is you getting a title, an abandoned vehicle is one that nobody wants, and in most states, most jurisdictions abandoned vehicles are seized by the state and auctioned off. Because abandoned means nobody wants it. Abandoned is not “finders keepers” it’s not whoever has it gets to keep it. It’s nobody knows whose it is, nobody knows where it came from. So the state takes it and they try to contact the owner or try to contact the lienholder. If that fails they auction it off. You don’t get to keep it. So a lot of times we have people that call us up and say Hey look I filed for an abandoned vehicle and they towed the car away, what do I do? Too late. So don’t file for an abandoned vehicle because once you file for it it’s too late. Now it’s in the system as abandoned and you might lose out on it.
So, be aware of that and be forewarned that you don’t want to file for an abandoned vehicle unless you just want to give it away. There are other methods you can use. If you have any questions put them in the comments.
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