Is buying or selling a vehicle without a title a good idea? In this episode of car titles, we’re going to talk about how vehicle titles are more important than actually taking possession of the vehicle. We get hundreds of calls a day, sometimes over a thousand calls a day, and many of the time that people call in it’s because they’re considering purchasing a vehicle without a title and they want to know how they can get a title if they buy it.
Legal Advice: Never Buy Without a TitleIn our sales department, we always have the advice to never buy a vehicle without a title. We never recommend doing it. Title is a legal government document you see like this and it’s something where if you buy a vehicle and even if you get a bill of sale even if you get the keys even if you get possession if you don’t get that certified title document you have nothing you’ve purchased nothing. The title document is the most important thing.
Legal RamificationsSo, can you buy a car without a title? Well, let’s talk about what happens if you do. In many states, it’s actually against the law to buy or sell a car without a title. Here’s the statutes from Texas: “The owner of a motor vehicle that is required to be titled must obtain the title before selling or disposing of the vehicle. That’s a crime if you don’t.” In Oregon, violating title requirements is also a crime.
Risk and RealityNow, that doesn’t mean the SWAT team is going to come in and swoop down and pick you up. People buy and sell cars without titles all the time. Why do they have these laws? Well, it’s to protect you from the risks involved. If you purchase a vehicle without a title, in most cases, you could probably get a title 70-80% of the time. It’ll all work out. But 20 or 30% of the time, you’ll never get a title ever. And you won’t know that until you actually try to get a title.
Unreliable ChecksThere’s no amount of searching VIN checks, car checks, background checks on a vehicle you could ever do to find out 100% if you will get a title. Forget about Carfax, VIN search, VinAudit, none of those places are going to tell you everything you need to know about getting a title. Even if it looks like it’s a clean vehicle, clean title, it doesn’t mean necessarily you get to be the owner of it, right?
Hidden IssuesSometimes vehicles are not eligible for you to get a title because of something in the background. Maybe it’s a salvage title, maybe it’s a parts-only title, maybe it’s reported stolen. Some of that you can find out on Vin or Carfax, but if there’s a lien on the vehicle, you will never find that out by Carfax.
Lien IssuesIt might say no lien found, but if you read the small print, they don’t search for liens everywhere. In fact, Carfax has about 10% of all liens in their system. So, you’re not going to find it. You can’t get that information from the DMV either because they’re not allowed to give it out.
Ownership DisputesIf there’s a lien on the vehicle, all title transfers are blocked. You cannot transfer title with a lien on the vehicle, even if it’s paid off, until the lien holder clears it. If there are any ownership disputes on the title, if the last owner maybe doesn’t agree or doesn’t want to cooperate with you to do a transfer, you’re going to have a problem.
Financial RiskSo, unless you’re willing to take the money that you’re looking to spend on that vehicle and completely make it speculative, put it at risk, don’t buy a car without a title. End of story.
Post-Purchase SolutionsNow, if you have already purchased a vehicle without a title, now you have to at least try something. It doesn’t hurt to try. You can try a bonded title, court order title, prior owner contact. There are many methods you could try to get a title. Our website has them all listed below.
Seller’s ResponsibilityBut if you’re considering purchasing a vehicle without a title, ask the seller, “Why don’t you have a legal title to give me like you’re supposed to under the law?” If they can’t give you a straight answer, then just walk away. It’s a scam. Even if they have an answer that sounds good.
Seller ReliabilityLook, I can’t tell you how many times our sales staff comes to us and says, “Look, I talked to this person, the sellers seem legitimate, they seem like honest people, they were a middle-class couple, everything seemed legit, but I can’t get a title.”
Seller’s Post-Sale ReluctanceEven if the sellers have good faith when they’re talking to you about buying the vehicle, it doesn’t mean later they’re going to change their mind. Once they have the money in their hand, they’re not going to do anything to help you.
Common ProblemsThe number of times where something comes up that is more problematic than that is greater than you think. Many times there’s a lien on the vehicle, many times there’s a title pawn on the vehicle, many times it was sold at an auction like Copart or IAA and it has a salvage or parts-only title.
Salvage Title ChallengesEven a salvage title requires a very thorough detailed inspection. Sometimes the inspection has to go to the state where the last title was from. So, if you buy a car from out of state and it’s salvage, you would have to bring it back to that state, have it inspected, and have it approved.
DMV HurdlesI can tell you this: the states don’t want salvage vehicles back on the road. The DMVs look for any reason they can to fail a salvage inspection because their official position is salvage vehicles don’t belong on the road. They’re for parts.
Financial GamblingTechnically, if you jump through a bunch of hoops, you can get it back on the road, and it happens 50% of the time. It’ll work. But again, do you want to take your money and give it a 50/50 chance of being thrown away?
Recovery OptionsWould you go into the casino and bet $7,000 on blackjack or the roulette wheel? Because that’s what you’re doing by buying a car without a title.
Steps to RecoveryIf you receive incorrect or incomplete information or lost it, remember that can happen too. You buy a card and lose it, you may have the option of using a bonded title. Here are the steps: Purchase a bond, apply for a bond.
Final AdviceRemember, purchasing a vehicle without a title is a risk. Make that decision wisely. If you decide to go through with it or if you’ve already purchased a vehicle and now you’re stuck and have to do something, then you can look at these methods: bonded title, court order title, prior contact. There are other things you can do.
Regretful BuyersMost of the people who call us that already bought a vehicle without a title wish that they could go back and not do it because it’s not worth the hassle. It’s going to take your time, even if you do it all yourself for free.
Legal FrameworkYou know, you don’t have to pay anybody to get you a title if it’s your vehicle. You can do it yourself. But it may take you 10-15 hours of time to research, get documents back and forth, then you have to get the runaround from DMV.
ComplexitiesThen you have to wait for them and hope, cross your fingers that nothing comes up that prevents that title from being issued. Sometimes there’s another title that’s already been issued that blocks your title, sometimes there’s a prior owner claim, sometimes it’s a deceased owner where that vehicle has to go into probate.
State LawsThere’s a lot of things that can come up. We could never even get into them all in a video. But that’s why the states have these laws that it’s illegal to buy and sell a vehicle without a title. They just want to keep it simple.
ResearchInvestigate your state. You can do research. Every state has their statutes online. Transportation code, vehicle title and registration code. This one is for Oregon, but every state has these documents.
ConclusionBut even if it is legal, you probably don’t want to do it anyways because you could be out of luck and all your money’s gone. And now you have to worry about trying to resell it to somebody else without a title and cross your fingers and hope that you find a buyer or to sell it for parts.
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What is a Court Order Title?So what is a court order title and how does it help you get a title certificate for a vehicle?
The Court Order Title ProcessA court order title process is a method where if you don’t have the right paperwork that your DMV or your title agency in your state is willing to accept, you go over their head.
Going to CourtYou go over their authority to go to the court system in your county where you reside.
Proving OwnershipYou basically tell the court that you are the legal owner. You have documentation, you have a bill of sale, receipts, and you want them to sign an order directing the DMV commissioner to give you a title that gives you power over the DMV.
Verification by the CourtNow the Court’s going to verify your story, whatever story you have about how you bought the vehicle.
Preparing Your DocumentationYou’re going to have to put that in writing. It’s an Affidavit of facts, a declaration of non-interest, and a petition.
Filing with the CourtYou prepare those three forms, filing with the court.
Conditions for JudgmentIf everything checks out in the vehicle – it’s not stolen, no liens, no salvage, no back taxes – the court will generally give you a judgment of ownership based on their discretion.
Obtaining the TitleOnce you get that Judgment of ownership, you bring it to the DMV, slap it on the counter, and they give you a title.
State-Specific RulesEvery state has different rules about that. Sometimes you have to get rejected first by the DMV before you go to the court.
Additional Court RequirementsSometimes the court will do a background check on the vehicle. Sometimes they’ll want you to send out letters to the last owner.
Initial StepsYou will not know what you need to do until you file with the court, so the first step is to file with the court.
Preparation for CourtNow, you can’t just walk into the court and say I want to do a court order title. They’re not going to know what you’re talking about.
Importance of PreparationYou have to walk in with your petition, your affidavit, your letter of non-interest already prepared and file them with the court and let the magistrate take action on it.
Court Clerk’s RoleThe court clerk can’t advise you. They’re not going to know what specifically a court order title is.
Being ReadyYou have to come in already prepared. You can’t come in empty-handed because the court’s not allowed to give you assistance. They can’t give you legal advice.
Filing by MailSo make sure you’re prepared when you walk into that courtroom. In fact, we don’t recommend walking into the court. We recommend filing it by mail because that way the clerk won’t make any misunderstandings about what you’re trying to do and reject it before it even gets to the magistrate.
Consequences of Canceling the Vermont Title LoopholeWell, it’s been about 6 months since the famous Vermont title loophole has been cancelled and banned by the state of Vermont and the other states so what have been the consequences and the Fallout from all this with vehicle titles look thousands of people every day purchase Vehicles without titles and they need a title solution for many years the Vermont loophole has been a go-to fix for that problem but at the same time it’s also been under Fire.
Awareness of Alternatives: Court Ordered TitlesIf you’ve been watching our Channel for the last few years you’ve seen us talk about the fact that this thing was going to go away we knew it even 5 years ago now that it’s gone what do you do what we have seen is the most powerful title loophole as an alternative to the Vermont process is now becoming much more publicized for example the court ordered title process which is eligible in all 50 states used to be that you could only find it on two counties website in the whole country and there are 3,611 counties in the country up until this year only two of them had something on their website about a court order title in fact if you walked into most County cour houses and talked to the clerk and said hey I want to do a court ordered car title they would not know what you’re talking about right.
Increasing Availability of Court Ordered TitlesWe’ve been doing court order titles for 7 eight years but most count didn’t know about it and it’s fair because most counties also don’t know about a dog bite lawsuit right it’s not a a name that they give to a process it’s a type of case that they do in their court but here’s the thing now that the Vermont loophole is cancelled and banned what you’re finding is more and more courts and every day we’re finding more here is one from Le County Pennsylvania here is one from uh IND in Minnesota right instruct instruction guide for a court order title here is one from Indiana court order title application um here is one from also from Pennsylvania inv voluntary transfer of a vehicle in that particular County so here’s the thing this is the way that the government wants you to get a title now just saying that means a lot of people aren’t going to want to do it that way most people want to do it their own way.
Advantages of Court Ordered TitlesBut even when the Vermont process was available this court order Ty actually had some advantages first of all the state of Vermont charged you sales tax on the full book value of the vehicle didn’t matter what you paid for it second of all you had to wait for the Vermont to process of registration get a license plate then take that to your state to exchange for a title A lot of times people didn’t do step two because they figured well I already got a license plate and I’ll drive around on it but that’s going to come back to haunt you because when you do go to switch it over to your state they’re going to see that you did drive around on it cuz a look at the date and they’ll penalize you the court order title bypasses all that you just go to the court you get a judgment of ownership you bring that to your DMV or dot whatever organization in your state gives titles smack it on the counter and they give you a title so the Fallout from this is because of the fact that now um Vermont is not available more and more counties are more familiar so they’re streamlining the process it’s making an easier process so on our website you’ll see instructions for how to do a core order title of course we have Title Service if you want some assistance with it but it’s the way to go it’s even better than a bonded title because on a bonded title you have to purchase a shity bond from a Bonding Agency that’s going to be 1.5 times the value of the vehicle in Most states then you have to submit it to the DMV for them to approve it at the court level once you get that petition you bring it to the DMV and they accept it you want to make sure though that you get all your paperwork right because if you see even on this fact sheet from Pennsylvania it says pendot which is their version of DMV will not offer legal advice regarding a court order title so they can’t help you the DMV in some respects can help you with paperwork the court cannot help you because that’s considered legal advice so make sure you have all your ducks in a row all your paperwork right you know most of the counties have a a big time um checklist you know this one is I don’t know 11 pages long with all their instructions and you could walk through it and do it all yourself right all the different steps but if you want help you can have that made available to you.
Conclusion: Benefits of Court Ordered TitlesThe good news from the Vermont loophole for title being shut down is that now everybody is doing the court order title which is much more powerful it’s a clean title unlike a bonded title you don’t have the word bonded stamped on your title you’re not jumping around all different states to get titles from this state and then switching it to another state worrying about insurance you’re doing it the way that is the most powerful you’re going over the head of the DMV so after 6 months we’re seeing that just like all things it works out in the long run in the best for consumers and people getting titles for their vehicles.
Title and Vehicle Ownership:So how does it work if you’re buying a car and not getting a title from the seller? You know, a title is a legal government document issued only by government agency. You’ve seen them before; it’s a certificate that looks like this and that proves that you are the owner of the vehicle that the last title owner sold it to you; they transferred it to you.
Considerations Before Purchase:If you don’t have that and the seller doesn’t have one to give you, you need to think very carefully about that purchase. Because there’s a chance that you could buy that car and never get a title. You need to first ask the seller why they do not have a legal title document to give you when you give them the money.
Risks and Legal Ownership:If they’re the legal owner and they just lost it, they can get a duplicate real simple. If they’re not the legal owner, now you’re buying a car from somebody who’s not legally the owner; that could put you at risk. We always recommend that before you buy a car without a title, that you really think twice about: are you willing to put that money at risk?
Potential Issues with Title Acquisition:Most of the time, it’ll work out and you can get a bill of sale and get a title, but 20-30% of the time, you may never get a title for that vehicle. It could turn out that it has a lien on it, has back taxes, it’s a salvage, it’s parts only, or it could just turn out that the process you would need to do to get a title without having a valid certificate is too hard or too costly or takes too long and you just don’t want to do it.
Additional Claims and Considerations:There may also be other claims against the vehicle like a probate case or maybe a UCC against the vehicle that could also block the title transfer. So just because you’re getting a bill of sale doesn’t automatically mean you’re going to get a title.
Government Authority on Titles:Most of the time it does, but the government is the ultimate decider of titles. A title is a legal government document issued only by a government agency. You can’t buy one from a company; you can’t download one from the internet. It only happens after the government decides that you are legally entitled to be the owner of that vehicle.
Challenges Without a Title:And if you don’t have the title certificate that proves that, they’re going to make you jump through a lot of hoops. Now, there’s ways to make it easier; our website will give you instructions on how you can make that process easier, and we also have a title server so we could do that as well. But we never recommend buying a vehicle without a title unless you’re willing to take the risk with the money you’re paying for that car.
Title Transfer on Salvage VehiclesSo how do you transfer a title on a salvage vehicle? Well, here’s the good news and bad news. If you have a salvage title vehicle and you actually have the salvage title document, it’s a pretty straightforward process just like any other title transfer.
Seller Transfer and Application ProcessThe seller of the vehicle, which is normally going to be an insurance company if you bought it through Copart or IAA, will have signed it over to you on the back as the new owner. You apply for a new title just like you would with any other type of title, but with a salvage vehicle, there’s an additional step.
Inspection RequirementThe vehicle has to be inspected before a new title is issued. They’ll arrange for you to have an inspection done to ensure it’s safe for the road. A salvage title by definition is one that had an insurance claim paid, so they need to verify everything’s in order.
Documenting RepairsIf you’ve had to make repairs to the vehicle, keep your receipts. They’ll likely verify your repairs with receipts for parts at the time of the inspection. It’s part of ensuring the vehicle meets safety standards.
Challenges without TitleNow, if you don’t have the title—meaning you bought it from Copart or a seller who didn’t provide it—it gets more complicated. You usually need the old title to apply for a new one and get an inspection. Without it, you might need legal or administrative steps to proceed.
Alternative Steps and AssistanceIn that case, you may have to get a court order, contact the prior owner, or even the insurance company for a duplicate. Our website provides instructions on these processes, and we offer title services that can assist you through these challenges.
Ensuring Road SafetyA salvage title transfer is similar to any other title transfer, but it includes verifying the vehicle’s condition through an inspection. This ensures that nothing about its history makes it unsafe for the road. Inspections are thorough to prevent unsafe vehicles from being on the road.
Stringent Inspection ProcessInspectors are meticulous. Even if the vehicle looks fine to you, they’ll verify its condition to ensure it meets safety standards. This diligence ensures road safety and compliance with regulations.
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