Why are there so many problems with titles for vehicle lease buyouts? Our help desk sees this problem frequently where somebody gets to the end of their lease and decides to pursue a buyout, but then months or years later they end up with a vehicle they can’t drive because they don’t have a legal title. You paid big money for your buyout, why does this happen?
When you lease a car from the dealership, the dealer will have the vehicle titled in the name of the lease company, not your name. This is because when leasing a car, the lease company is technically the owner of the vehicle, you are essentially renting the car. You may be the registrant, meaning that your name is on the registration and associated with the license plate, but the titled owner is the leasing company. When leasing a car, you are the registered driver, not the registered owner.
Leasing a car from a dealership is different from financing a car from a dealership. When you finance a car, you are also one of the owners of the vehicle in addition to the lender/lienholder. This is because you purchased the car with the assistance of the lender/lienholder, therefore once the loan is satisfied, the lender/lienholder will no longer be an owner. When leasing a vehicle, once the lease is up, the car either goes back to the leasing company or you can buy out the vehicle from them.
When you get to the end of the lease, you’ll have the option to buy out the vehicle from the leasing company, trade it in for another vehicle, or give the car back without a buyout or replacement. After driving the car for a few years, many people opt to buy out the vehicle from the leasing company. If you decide to buy out the vehicle, the leasing company is supposed to sign the title over to you as the new owner, record it with the DMV agency in the state, and have the DMV issue a new title with your name on it. If they don’t do this, they remain the registered owner of the vehicle.
Here’s where the big problem lies… many people assume that the leasing company took the car out of their name, but they didn’t. Later on down the road, this creates a big problem if you are planning to sell or trade in the vehicle because if you’re not the registered owner according to the DMV, you cannot sell or trade in the vehicle because you don’t own it. If 2-3 years later you try to reach out to the DMV or the leasing company, they may have problems locating the correct paperwork, no longer have the specific documentation, or no longer be in business. What ends up happening is the lessee who bought out the lease thought they were the registered owner, but now have a piece of metal they can’t do anything with because they’re not listed as the registered owner.
If you’re at the end of your lease and you’re considering a lease-end buyout, make sure to get the title transferred into your name as soon as possible. Make sure you have an actual certificate of title in your name with your name on the front. If you don’t see the title in the mail within 2 weeks of the buyout, follow up with both the leasing company and the DMV agency in your state. The leasing company has legal obligations to properly complete the transfer so make sure to alert the DMV of any issues you may have with the transfer.
If it’s been a longer amount of time, maybe you bought out your lease a year or two ago, you may need to use a court order process or a bonded title process to get the title transferred to your name properly.
Another option is to prepare the transfer paperwork for the leasing company and mail it to them directly. Each state has its own title transfer form. Find the form specific to your state and complete as much as you can. Send the form to the leasing company with indicators on where to sign. Include an envelope and stamp so they can easily send the documents back to you. When you receive them, submit them to the DMV in your state by mail or in person. Sometimes the convenience factor is what gets the ball rolling.
Most of the time when lease-end buyouts have title problems, it’s not because the leasing company is purposely forgetting or being malicious. Leasing companies don’t normally have a large department of people that are responsible for issuing titles and processing title transfers. Their main business is leasing new vehicles and collecting payments and may not have a large administrative department. While title transfers are still an obligation for the leasing companies to complete, it’s important to remember that the reason there are problems with the process isn’t necessarily due to maliciousness.
So if you’re considering a lease-end buyout option, make sure to take into consideration the title transfer process and how you plan to get this done. Avoid trying to do this over the phone, you are more likely to get results if you have the process in writing such as through email or postal mail. Make the process easier for the leasing company by doing some of the paperwork for them, and follow up with the DMV if you haven’t received your title yet. If it’s your car, you deserve a title with your name on it.
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Anytime we see examples of EV battery replacement costs we always like to feature them here. Here’s an article from Green Cars, talks about the cost of replacing the battery. Here are some real-world examples that they talk about.
The Prius might cost you $2,700, whereas a Tesla could cost $20,000. So that’s a big price range. The article states that the prices for lithium-ion battery packs have declined since 2007 which is a good thing because a Tesla Model S in 2020 would cost $16,000 before labor and that’s just for the part. In the future that might cost closer to $7,000 because the battery production costs may go down. In general, they’re talking about $89 per kilowatt hour in a couple of years. In a decade it might be $56 per kilowatt hour. As of 2020, the average cost was $137. The typical EV battery with 40-kilowatt hours could cost about $5K-$6K and some batteries could be $13,000, again that is without labor. Labor can cost another couple thousand. There’s also a used market for those. E-bay is a source for a used market. Nissan leaf and Chevy bolt had prices of $6,200 and $16,000 respectively. BMW I3 had a $13,500 battery. There’s a lot of range in what it costs to get a battery for those vehicles.
The big question is going to be is it available? We’ve seen some vehicles that when they get older, there are no sources for batteries anymore. So if you are driving an electric vehicle and you see your capacity getting down because once it gets below seven 70% the factory warranty probably is going to kick in but if it’s still above 70%, and you’re not quite at the top yet, you may not have the ability to put in a warranty claim. So you might want to start looking at used batteries while they’re still available because there are already some that are out of production and you can’t get a new battery for your electric vehicle. If anybody’s put a battery in their electric vehicle as a replacement, put comments below to let us know how much it cost. If you have a copy of the receipt put it there. I’m sure the other viewers would like to see real-world examples of electric vehicle battery replacement.
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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+
A new development in automotive registration in California has paved the way for digital license plates for all vehicles.
What does a digital license plate mean? Well, you normally expect to see a license plate being a piece of metal that’s stamped and painted and put on your car. That metal plate is provided by the government agency in the state, which issues registrations normally called the department of motor vehicles or department of transportation. Well, California is now allowing for digital plates. It’s kind of like an E-reader. It’s got that E ink on it as you’d read like a tablet. It’s protected by a piece of glass that’s really strong and resists chips or breakage. It can be programmed with an app, so you can change the plate number on your vehicle.
Now originally this is designed for corporate fleets, so if you have a registration and you’re changing it from one state to another. But it also allows for different types of tracking of the vehicle. It can also be changed if the vehicle is reported stolen or if it has some type of violation against it, that may show up on the screen.
So what are your thoughts on the privacy implications of having a digital license plate? Would you put a digital license plate on your car? Some other states are also looking at this technology and the big proponent of this or the big reason for doing it is the play can display information other than a car’s license plate number. Meaning that you can put notifications about that vehicle or notifications about the cargo, maybe if it’s a commercial vehicle, or notifications about the driver if it’s in a fleet. So what are your thoughts on this and is this something that you think is going to be good in the long run or is it going to create more difficulties for registration and titling of a motor vehicle?
Vehicles have always increased the technology that they’ve used from manufacturers. In fact, even in the late eighties-early nineties, there were cars that talked to you and it would tell you your door’s open or your battery is low. But now technology is creating another evolution in the automotive profession and that has to do with repairs.
Many vehicles now do not need a mechanic to diagnose the vehicle. There are computers, chips, and sensors scattered all throughout the vehicle that will give a diagnosis of what might be happening with the vehicle. This is beyond just plugging into a diagnostic port that most vehicles have had for 20 years, this is very advanced technology. In fact, some of these new technologies don’t even require a mechanic to fix them, the repairs can be done with software with upgrades and downloads to a system’s computer programming.
As we get more into electric vehicles, the mechanical components will be less likely to be what’s wrong with the car. With an internal combustion engine, you’re going to find that most of the things that break are mechanical like valve trains, lifters, rods, internally lubricated parts, and transmissions. Those are the things that break a lot of times or their accessories like O two sensors or EGR valves. With EVs electric vehicles, the components that drive the vehicle, the electric motors are much more reliable. They don’t have as many violent motions inside the engine that makes it break. Internal combustion is literally what it sounds like, it’s combustion internally to that engine. There are explosions, there’s metal moving back and forth very quickly; in an electric motor it’s very smooth, and it’s not quite as violent of vibrational energy.
So what happens to the car mechanic? Will there even be auto mechanics? And is it going to be better or worse for a vehicle owner? Well, one of the things that could be worse is how long you have to wait for a repair. Without a need for constant maintenance and repairs, there may not be as much availability of replacement parts. With internal combustion engines, you’ve got to have a lot of parts laying around because you know you’re going to need them. With electric vehicles, there are not that many parts. Think about your cell phone. When was the last time your cell phone broke where somebody could actually fix it? Maybe you can replace the screen, but other than that there are not many repairs you can make to a cell phone. Usually, when your cell phone stops working, what do you do? You get a new cell phone. Is that going to be how vehicles are done in the future?
In addition to that, what about collision repair? Meaning body repair. If you get in an accident, God forbid, you bring it to a body shop collision repair shop. They pull off the dented panels, pull the frame straight, put on new panels, repaint it, and send you on your way. With electric vehicles, or even vehicles that are still gasoline but computerized if you get in an accident that damages the vehicle substantially, it may not be possible to fix that vehicle in a way that’s safe for the road. In electric vehicles, the battery is an integral component of the chassis. It’s literally the floor pan of the car, all battery. So if the cars hit and that floor pan is dead then the battery may become breached damaged. And you saw what happened to batteries that were damaged in the Florida hurricane. They caught on fire. So these vehicles may not be repairable.
You may also find the electronics and the sensors in the vehicle are worth more actually than the body. So if you crash your car, the insurance companies might look at it like well if we can recover all these electronics and these motors it might be cheaper just to total the car. Take out the motors and electronics, sell them for parts and give the person money for a new car. So this conversion to electric vehicles, electronics, and computers might actually completely change the way automotive repairs are done both on the mechanical side and the collision side.
Let us know what you think in the comments about the future of automotive repairs. And if you’re in the business, what are you seeing or already fixing for newer vehicles?
When you’ve paid off the balance of an auto loan, your bank or lender should send you one of two documents: either a certificate of title or a lien release. But what’s the difference between the two and how do they relate to one another?
Your lender, who has loaned you money to purchase a vehicle, places a lien on your title until the loan is paid off in its entirety. A lien is a claim on the property for the security of payment. When a lender loans a borrower (you) money to purchase a vehicle, they want to make sure that they are paid back plus interest. Your lender, also known as your lienholder, will remain printed on the front of your vehicle title until the loan is paid off. A lien on a vehicle title is a cloud on the title that places a hold on ownership; once it’s paid off, you can get a title for your car or you can sell it or trade it in.
A vehicle lien release is a document that officially declares that the lien on your vehicle title has been removed and you will be free to take action with your vehicle. This document removes any restrictions on what you can do with your car. A person is typically eligible for a vehicle lien release when the loan on the vehicle has been paid back to the lender.
The vehicle title, also known as the certificate of title, is a legal document issued by the department of motor vehicles in your state that assigns ownership over a particular vehicle. In addition to serving as proof of ownership, the vehicle title may also be used to transfer ownership of a car.
No, the lien release and certificate of title are two different documents. While they both state the official owners of the vehicle, the lien release is needed to remove the lienholder from the title. Until the lienholder is removed by providing a lien release to the DMV, they will remain as a security interest on the title.
Some states, known as title-holding states, require your lienholder to retain your certificate of title until the lien is satisfied. Once the lien is satisfied, the lienholder should not only send a lien release, but also the certificate of title that was retained. Both of these items will be used to transfer the title out of the lienholder’s name.
Non-title-holding states will send the vehicle title with both the owner’s name and the lienholder’s name to hold onto until the loan is paid off. A lien release is still required in this case to remove the lienholder’s name, even though the title resides with the owner.
All in all, a lien release is not the same document as a certificate of title. The lien release document is what is needed to clear the lienholder from the title and transfer it to a clear title in your name once the lien is satisfied.
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