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The process of obtaining a car title can be confusing, especially if you recently moved or you’re missing ownership documents. Many buyers simply choose to not transfer their title to avoid the stress and hassle. We’ll discuss the basics of what an automotive title or vehicle title is and how you can obtain it for your vehicle.
A vehicle title is a legal government document. They’re only issued by a government agency, you cannot buy one online, you can’t download one from the internet, and no company can even sell you a title. They can only be issued by the government agency in your state that handles titles and registrations. Normally, that agency is the Department of Motor Vehicles (DMV) or sometimes the Secretary of State, or the Department of Transportation. Different states have different names for these organizations that issue vehicle titles, but typically it’s the DMV.
What these organizations do is issue title documents for vehicles and not only does it reference the actual vehicle but it also defines the ownership. For example, it’ll have the vehicle identification number (VIN), year, make, and model of the vehicle. It’ll state the name of the owner for example Joe Schmo at 123 Main Street, so it’s not only referencing the actual asset but the owner of the asset as well.
That’s important because if your name is not on the title, you’re not the owner.
Even if you have the title in your hand and the vehicle in your possession, you’re not the owner. The only way to become the owner and to get a new title with your name on it is to take the old title with the name of Joe Schmo that’s been signed over to you by that prior owner to the DMV. If you don’t have the title properly transferred from the prior owner, the DMV is not going to issue you a new title simply because you cannot be identified as the proper owner.
You can’t get a title with just a bill of sale which is just a receipt with a copy of the registration. Some people think because they have the VIN number that they have possession of the vehicle and can get a title. Unfortunately, titles don’t work that way. Titles are not bearer instruments meaning that just by having the vehicle and yourself available won’t you get a title. In addition to that title document, there is also a title record meaning that the DMV will have this information on file in their system. That is important because if the title document is lost they will issue a replacement or duplicate title but the only person who can apply for that is the person who’s named on the front of the title. So, if Joe Schmo is named on the title and he loses his title document he’s the only person that can go to the DMV and request another title. They’ll verify his identity, look at his ID they’ll make sure it’s really him because they will not give the title to anyone else
If you have a vehicle you’ve acquired and you don’t have the proper title signed over to you, it’s not as simple as applying for a duplicate title or applying for a lost title. You have to go through some other processes and there are various methods that you can use to get a title when you’re in that scenario. They’re not as simple as calling up the DMV or bringing them a bill of sale, there are some hoops to jump through in order to obtain a new title. Those different titles are called title recovery. It’s when you lost the title or don’t have one and you need to get a new one if your name.
A couple of the common methods are
Each one of those methods has certain documents and forms that need to be filled out and signed by certain parties. The other thing about government agencies like the DMV or title offices is they don’t do things online or by fax or email or phone. In almost every case you’re going to need to submit to them an actual paper document with your ink signature on it. The reason is that again they want to verify the identity of the person who is obtaining this title, this legal document. Another way to think about it is if you have a vehicle title, that is equally as valuable as a birth certificate, passport, driver’s license, or other government documents.
In fact, it’s almost like currency or paper money. Whoever has their name on that title and has the title owns the value of that vehicle. If the vehicle is worth $4,000, the vehicle title is equivalent to $4,000 cash. The vehicle title is worth the value of the vehicle. Whoever has that title in their name is the rightful, legal owner of the assets so asking the DMV for a title for a vehicle that’s worth $4,000 is like walking in and asking them to give you $4,000 in cash, that’s how seriously they take it.
All of these other title methods magistrate title, VT transfer, prior owner contact, deceased owner title, mechanic’s lien, abandoned vehicle title, each one of those will have very significant requirements for you to go through in order to get that new title issued in your name.
One of those methods is the bonded title and bonded title process goes something like this:
You fill out some affidavits to say you are the legal owner of the vehicle. You describe how you obtained the vehicle, and you sign an application for title. Then, you are going to present that to the DMV. However, with this method, you’re asking them to take your word for it that you are the owner. Luckily, most states are going to say “okay we’ll take your word for it!” however, they want some backup. Additionally, you’ll need to obtain a surety bond from a bonding company. The one we recommend is ProBonds.com and once you obtain that surety bond from any bonding or insurance agent, you attach that to your application and submit it to the DMV. Then, they’ll issue you a new title with your name. That title will say bonded on it to notify you and anybody else to who you might want to sell the vehicle that was obtained using a bond. That reference will remain on that title for between three and five years depending on what state you’re in and what the value of the vehicle is. After a point in time, bonded will drop from the title, it’s not like a salvage title that will stay there forever. A bonded title will go away at some point. The surety bond guarantees to the DMV that they’re not gonna be on the hook for that vehicle if what you’re saying is not true or if somebody else attempts to claim the vehicle.
There are some legalities to check to know what you’re getting into with a bonded title. Almost all states allow for a bonded title. There are about eight states that do not, including, but not limited to, Ohio, Louisiana, Oklahoma, Oregon, and South Carolina. Be sure to check with your state to make sure it accepts bonded titles. For a list of states that accept and decline bonded titles, click here.
If you’re in a scenario where you have a vehicle that you don’t have the title for, you may have no choice you may have to use a bonded title to get proper ownership documents for your vehicle. Again, it’s one of several methods that you could use. In future podcasts and clubhouse rooms, we’ll talk about some of the other methods but consider this as a first choice. The reason why is because it’s usually the fastest and cheapest method to get a title. In most states, you can get a bonded title in a few days. The cost is minimal and you have to pay regular title fees. For most vehicles, the cost of the surety bond is about $100 as long as you don’t have an exotic high-end vehicle.
There are other methods you can use to title your vehicle and the bonded title method is likely the most direct route to consider. Check out our website to learn more about title methods. If you have questions about your scenario or want more details, you can reach us at 256-448-4853 or by email at [email protected].
Don’t let uncertainty hold you back. If it’s your car, you deserve a title.
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