Possible Loan ReductionDid you know that up to 20% of the balance of your existing car loan may be able to be removed from that balance? When you purchase your vehicle, you may have been inadvertently charged extra interest and add-ons, which include things like gap insurance, force-placed insurance, VSI insurance, and add-ons like service maintenance contracts, extended warranties, and theft notifications. There are all kinds of add-ons that they put on car loans in the F&I office (the finance and insurance office) at a dealership.
Baked-In Add-OnsWhen you sign all those documents, sometimes those charges are already baked into the payment that you’re quoted in the showroom. They don’t have to raise your payment. They can just say, “Yes, here’s your payment.” And when you sign it, it’s already in there. They’ve already figured that in. What happens is after you pay on the car for a year or two, you’ve paid down some principal—mostly interest, though. Then you call for your payoff and you owe $32,000, but your car is only worth $24,000. So you have $8,000 in negative equity. You can’t trade it in or sell it because you owe more than it’s worth.
Negative EquityWhat if you could cut off $4,000 or $5,000 worth of that balance, maybe more, and get closer to breaking even? Now you could trade it in, sell it, or work with your lienholder. Some lienholders have a short sale process. You can click the link below.
Options and ReliefEither way, you want to look at all of your options because in many cases, up to 20% of your loan balance can be removed from the principal amount. And 20% could be a lot. That could get you closer to an equity scenario where you don’t have upside-down or underwater balances owed on your vehicle and get you closer to getting out of that high car payment and into something that’s more affordable or a vehicle that’s better suited for your current life.
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What is the 25-Year Import Exemption Rule?This is a rule that allows vehicles that are 25 years old or older to be imported without all of the same import requirements typically required by the EPA, DOT, and other customs requirements.
Customs Requirements ExemptionThe 25-year requirement only excludes and exempts vehicles from US customs requirements. It does not require states to exempt vehicles from their titling and registration requirements.
New Opportunities in 2025Now that it is 2025, there are some additional vehicles—tremendously interesting vehicles—that can now be imported into the US without having to go through the stringent import requirements. This is a great article in Motor Trend about some of these new additions to the approved list.
Featured VehiclesToyota Caldina GT: An all-wheel-drive rally-type wagon, similar to a Subaru WRX but in wagon form, available for around $10,000 to $12,000. Subaru WRX Type STI: An upgraded version with 276 horsepower.Mitsubishi Lancer: A very interesting vehicle, typically priced in the $30,000 to $40,000 range. Honda Accord SiR Wagon: A cool car from the late 90s/early 2000s, now importable.
Final ThoughtsOnce you take a look at the new allowances for these Japanese imports, you can see which ones might be of interest. Just make sure that you’re going to be able to get it through the titling process in your state before you start shelling out a whole bunch of money to get one of these cars through customs, because customs is only the first step before it goes into a situation where you can put it on the road and be driving it.
How Can a Clean Title Go to Salvage?So how can a clean title go to salvage if you have no accident? Here’s a great example of how a title record may not be 100% accurate. This is a person who purchased a Tesla with a clean title, and then, after they purchased it, they found out that it’s a salvage and it’s going to cost $12,000 to fix it. Here’s how this happened.
The way that a salvage title can be created isn’t just one method. It can be created either by the insurance company, who pays a claim on a vehicle that says, “We paid out this much money to have this vehicle fixed, so now it’s a salvage.”
Other Ways a Salvage Title HappensAnother way to do it is if the owner of the vehicle fixes the car themselves and says, “I fixed this damage, and I want to make it a salvage to protect my liability if I sell it.” Another way is if the damage is detected by the factory or the manufacturer, and then they put it on the record. That’s what happened with this Tesla.
What happened was this Tesla was damaged in an accident. The owner of the vehicle at the time fixed it themselves. They didn’t want to go through their insurance. They didn’t want to put it on the title. They fixed it, and then they sold it to a third party.
What Happens When a Dealership Finds the DamageOnce that third party purchased the vehicle, they brought it to the Tesla dealership to have some repairs done. The manufacturer was able to determine that the car had been previously damaged both from the diagnostics on the vehicle. The computer said there was an impact; there was deceleration, and then also they did an inspection, and they found that the frame had been dented and the battery had been damaged. So the Tesla dealership put a salvage designation on it. This is completely legal. The salvage designation does not have to come from an insurance company. It can come from any method.
Why Buyers Must Be Extra CarefulSo this is why it’s very important when you’re purchasing a vehicle not only to check the title record. In this case, the buyer checked Carfax. Now keep in mind, even if the car had been filed through an insurance company, Carfax doesn’t catch everything. Carfax is not 100% accurate. It’ll even say in their disclaimer that the records aren’t 100%. So you may have Carfax records that are not complete. But the only way they do get it at all is if it goes through an insurance company. They’re not going to pick it up if the owner did it or if the manufacturer did it.
What to Check Before Buying an EVSo be very diligent, especially on these electric vehicles, to check out the frame. Check out the underneath. Check out the battery. Do a battery test. But also make sure that the physical examination doesn’t indicate there was damage, even if the title doesn’t show salvage on it.
Court-Ordered Title Process Gaining PopularityMore and more states are advising their department of motor vehicles offices to go directly to a court-ordered title process when there’s some type of complication on the title. Many states for years did not have knowledge at the DMV level that you could get a court-ordered title when you didn’t have the right paperwork for the DMV. We’re seeing more local DMV branches directing their customers and their clients to go right to the court process. In fact, some courts even now have this as part of their paperwork. Here’s an example from a Florida county.
Example from a Florida CountyA county in Florida says in their court’s instructions for vehicle ownership application: “It is sometimes possible to obtain an order to assist you in obtaining a title for a vehicle you own, but which you did not receive a title for at the time of purchase.” Does that sound like you? That’s 99% of the people who have title problems. Either they didn’t get a title when they bought it, or they did get a title and they lost it. The court may issue an order directing the Department of Highway Safety and Motor Vehicles.
What Is a Court-Ordered Title?That’s what the DMV is called in Florida, to issue a certificate of title for your vehicle. This is exactly what a court-ordered title is. It’s a court order that tells the DMV, “You must issue this person a title.” And many times people think, “I don’t want to deal with the court or go to court.” It’s not a big Law and Order Jack McCoy court case. It’s all administrative. It gives you all the series of steps you have to go through to do the process. In this case, there’s a bunch of different steps.
Follow the InstructionsYou have to go through, but it’s all paperwork. It’s all documentation. And if you follow the instructions carefully, you can have the court become your friend, your ally in dealing with the DMV. Remember, the DMV or whatever it’s called in your state. Some states call it Department of Transportation. In Illinois, it’s Secretary of State. In Pennsylvania, it’s called PennDOT. Every state has an agency that issues titles. They have certain rules they have to follow. They cannot give you a title.
Why Courts Can Override the DMVNo matter how much they want to, no matter how much they like you, no matter how much you think you have the right paperwork, unless you have the prior title signed over to you, they’re not allowed to give you a title. However, their get-out-of-jail-free card is the court. The court can override the DMV by looking at your bill of sale, looking at your cancelled check, looking at letters you have, or something proving that you bought the vehicle, and they can say, “Okay, this person has the right stuff.”
They sign a document, you bring it to the DMV, you slap it on the counter, and they have to give you a title. So, a court-ordered title is actually preferred by the DMV when you have title problems because it gives them an out. They don’t have to fight with you about what you have or don’t have. The courts like to do it because they like to help you. In fact, this memorandum you’re looking at on the screen came from official court documents.
Challenges in Form PreparationThe problem is – I shouldn’t say the problem, but the hard part is – in order to prepare the forms for the court, it’s not like a blank fill-in-the-blank type document you’ve seen before. It’s not like name , address . You have to create these sheets of paper from scratch and figure out a way to put the wording on it. Our website will give you some more information on doing that. Every county’s a little bit different, and sometimes you’ll still have to navigate the court. One very important thing to keep in mind is: don’t go into the court in person and start asking them how to do it. They can’t tell you. Sometimes they’ll tell you, “We don’t know how to do it,” or they might even tell you, “We don’t do it.” They may not know.
Mailing the PaperworkEven if you have all the paperwork put together, ready to go, don’t bring it into court in person. Always do it by mail because you want to have it filed in their system without having to talk to somebody that maybe has the wrong information. So, in our experience, if you send it by mail, you’ll have way better success than if you bring it in person. I know it’s tempting. You want to bring it in and talk to somebody and try to control it, but a lot of times that’ll be your undoing and they won’t accept your paperwork. But if you mail it, you’ll be in better shape.
Why Courts Are HelpfulSo, the court-ordered title process is – you know, it’s been used for decades. We’ve been doing it for decades, but more and more courts are actually having forms like you see on the screen. More and more DMV locations are telling their clients, their customers to use this instead of trying to go with the DMV because their hands are tied. They can only do so much. So, use it to your advantage.
The Power of the CourtGo over the head of the DMV. Go to the authority that can tell the DMV what to do. Look what it says right here: The court may issue an order directing the department to issue you a title. That’s what you want. You want somebody to direct the DMV to give you a title. Think about how much of a runaround you’ve gotten from the DMV. Think about how frustrating it’s been. How would it be to have somebody with power to be on your side to tell the DMV, “No ifs, ands, or buts, give this person a title”? That’s what the court can do for you.
Charging Storage Fees To Get A TitleSo how do you—and can you even—charge storage fees for a vehicle in order to get a title? Many times we have clients that come to us and say, “Look, this car has been sitting on my property for 5 years. I’m going to charge $10 a day, so the owner has to give me $50,000, otherwise I’m going to own the car. That’s my rate for storage.” And that sounds like a great idea, but the law typically says otherwise. Now, the good news is there are ways to get a title for a vehicle that’s been sitting on a property that you own.
Storage Fees May Waive Your RightsIf a vehicle has been sitting on your property for a long time, charging storage fees is not the way to do it. If you do it the wrong way, you might actually waive your rights to that vehicle. How does that work? Well, here is a section from the statutes of the state of Illinois about storage fees. And the reason we selected Illinois is because it’s the same as most states, because most states go by the federal UCC, or Uniform Commercial Code, which talks about storage fees and storage liens. So the law says section 770 of the Illinois code states:
Written Notice RequirementAny person, firm, or private corporation seeking to impose fees in connection with the furnishing of storage for a vehicle in the person’s possession must provide written notice by certified mail prior to the assessment and accrual of fees. What does that mean? That means before you can even start the clock on charging storage fees, you have to give the owner of the vehicle or lien holder notice that you’re going to start charging them storage. You have to give them an opportunity to inspect the vehicle.
Vehicle Access RequirementThe vehicle must be accessible where the vehicle is stored within two days of the request. So if you send out that notice to an owner and lien holder and you tell them you’re going to charge them $10 a day, you have to give them access within two days to be able to inspect the vehicle and take possession of it. What happens if you don’t do that? If you fail to comply with this notification of storage fees, first of all, storage fees shall not be assessed, and the owner or lien holder shall be entitled to injunctive relief for the possession of the vehicle without payment of storage fees.
Legal Consequences Of Non-ComplianceWhat does that mean? Basically, if you don’t send them notice before you start charging fees right away, you can’t charge fees and they can get the car back. That’s the short answer.
Only For Licensed FacilitiesMaybe somebody tells you, “Hey, just start charging storage fees.” It doesn’t work. It’s not how it works. The only time it works is if you are a licensed automotive facility—storage, auto body, repair, towing—and you have a signed contract with the vehicle owner that authorizes you to charge storage, or if you towed it under a legal tow (like the police told you to tow the vehicle), then maybe you can do something. There are also other requirements in this law that can create liability for you. But if you’re a private citizen, even with a self-storage facility that stores people’s personal goods, you can’t generally charge made-up storage fees and just rack up the clock on that. You have to go through a process.
Storage Fee Method Not For Private CitizensSo if the thing you’re trying to do is get a title for a vehicle, that’s fine—you can do that. Don’t try to do it using storage fees. You might think that’s an easy way to go and clever, and “I thought of this great thing.” It’s not going to work. And it’s actually harder, takes longer, and it’s going to result in you losing the vehicle rather than if you do something else to get a vehicle title.
Use Legal Methods To Get A TitleLike a bonded title, magistrate title, VT transfer, prior owner contact—the website will give you the actual valid and successful ways to get a title rather than storage fees. And sometimes people think, “I’m going to use storage fees because I want to try to stick it to the owner” or do something clever, but it’s really not a title method. It’s a method that can be used in last resort scenarios where nothing else has worked, but you first have to try the other things.
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