Using Mechanics Liens To Get Titles

The Challenge of Obtaining a Mechanic’s Lien Title for a Vehicle So why is it so hard to get a mechanic’s lien title for a vehicle, and why is it not always the best way to try to get a title? For many years, repair shops, garages, and towing companies have used the mechanic’s lien or towing lien process to get titles for vehicles. A lot of times, they thought vehicles were abandoned and wanted to get a title. They even sometimes took payments from outside parties to go through a fake mechanic’s lien process to get a title. A lot of times, people with title problems will ask, “Can I just put a mechanic’s lien on the vehicle?” or “I’ll just file for an abandoned mechanic’s lien.”

The Purpose of Mechanic’s Lien: A Payment Protection for Repair Shops Here’s the problem: the mechanic’s lien process is a privilege provided to licensed automotive repair shops in order to get paid for work when a customer fails to pay the bill. So, if someone brings in a car to get fixed, then decides they don’t want to pay, the mechanic’s lien is designed to help the repair shop get compensated for their work. However, that privilege is frequently abused—or maybe “expanded” is a better word—to try to get mechanic shops titles for vehicles under questionable circumstances.

Government Response: Tightening the Mechanic’s Lien Process What the government has done, and what different state DMVs have done, is make the process very, very difficult. It’s harder than any other process, such as getting a bonded title or a court-ordered title, because they want to ensure that if a repair shop is using the mechanic’s lien, it’s for legitimate reasons.

Common Cases of Mechanic’s Lien Fraud A very common case of fraud involves repair shop owners engaging in title fraud. This fraud often involves creating fake work orders and records, claiming to be filing a mechanic’s lien, and then using the process to get titles for vehicles that may have been bought at an auction without a title, purchased through Craigslist, or have a lien they want to remove.

Government Oversight and AI Monitoring The government scrutinizes each mechanic’s lien application and audits them. They also use AI and algorithms to monitor shops filing a high number of mechanic’s liens. The government checks the shop’s payroll and sales tax records to estimate the shop’s business volume. For example, if a shop with only one or two employees files more mechanic’s liens than usual, it raises red flags.

Legal Consequences of Filing a Fraudulent Mechanic’s Lien If caught, repair shops involved in title fraud could face severe penalties, including prison terms of up to 20 years and restitution to repay any fraudulent profits. For example, in a recent case, shop owners were charged with creating fake repair orders and selling vehicles illegally, resulting in charges for title fraud.

Mechanic’s Lien: Powerful but Heavily Scrutinized A mechanic’s lien is a powerful tool, but because it’s often misused, it is scrutinized more than any other type of paperwork. If you’re considering using a mechanic’s lien to get a title, it should only be used when someone has brought a car to a shop for repairs, has signed a repair order, and then hasn’t paid.

Alternative Title Methods If you have a vehicle that needs a title and are considering a mechanic’s lien, there are other methods that might work better. Options like a court-ordered title, bonded title, or other procedures are often easier to execute and less scrutinized than a mechanic’s lien. These methods can be found on our website.

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