The Expert Podcast

So, did you buy a car and come to find out it has a lean on it? Maybe you bought a car on Craigslist, Facebook, or even at a car dealership and found out later that the title was blocked because there's a lean filed on the title. We hear this all the time. Talking to some of our sales staff earlier this week, a couple of the calls that came in were kind of troubling about these leans on vehicles.

One of the examples was a guy who bought a car from a dealership, a licensed automotive dealership, and the dealership gave him the runaround on getting the title. And come to find out, there's a lean filed on that title from a prior owner. The last owner of the car still has an open lean, and normally when that happens, it's only because the bank hasn't yet recorded the lean release. They deleted the lean, but in this case, it turns out there's still money owed on the car. It's not that the loan was paid off and they just didn't file it yet; there's still money owed on the car. So, what do you do in a scenario like that?
At the same time, there may be a case where the loan is charged off, it's a write-off, or it's non-performing. What do you do? Well, the answer is simple. First, what you want to do is request a lean release from the lean holder. Look, if there is a lean filed on a title record in a state, no state is allowed to issue a title until that lean is removed from the title record. Now, if there's money owed, it's still possible to get that lean removed. You have to ask the leanholder. In many cases, if it's listed as a charge-off, write-off, delinquent, or non-performing, if you ask the leanholder in the right way, you have a pretty good chance of getting that lean removed.

How do you do it? Well, the first thing you do is don't do it by phone, don't do it by email, and don't do it by text message. The only way you want to do it is in writing. And we've covered this before. You want to send a written request to that lean holder along with all the documents that are needed for them to remove the lean and ask them to sign it and mail it back to you. And we've covered that in other videos, so we're not going to go too far into that.

And look, if the loan is paid off, they'll sign it. If it's a charge-off, they'll probably sign it. The only time that they usually don't do it is if there's an active, open pursuit of collection against that. By collection, I don't mean that it's in collections. I mean, the loan is being paid, and the loan is current. There's an active recovery of those funds. So, you do want to try to get the lean released because if you don't get it, you'll never get a title. So, you have to at least try that. The other backup option is to file for a court order title. If the lean holder won't help you, you go over their head. You file a petition with the court in the county where you reside to ask a judge to intervene and have them wipe out the lean. And based on your affidavit that you bought the car and your bill of sale, you're going to ask the judge to help you out. They may or may not, depending on your scenario. But you have to do that because, here's the thing: if you don't get the leanholder to sign or a judge, you're out of luck. Whatever you paid for that vehicle is out of luck.

And in the case of the customer that our salesperson was telling us about, they were even in worse shape because, at first, we thought that they paid cash for the car because they told our sales agent that they gave the dealership a check. Well, come to find out, that check came from their bank. They got a loan for that car from their bank, and the bank's not getting a title. So now, not only do they not have a title, but they still have to pay their bank for the new loan. They're not going to get out of their loan just because the seller ripped them off. And this dealership supposedly has a lot of complaints against it for doing the same thing: not paying off cars, putting cars with leans on them on the road, and not giving titles.

So, make sure that if you go to a dealership to buy a car, before you pay the money or even finance it, they show you the title. You don't have to have it in your hands; they can't give it to you because they still have to process it to transfer it into your name. But ask the dealer to show you the title.
If you have a vehicle that you purchased but didn't get a title, there are some options you can use to try to resolve that problem. You can check out our website at cartitles.com to see what those might be. But this whole idea of cars with leans is really increasing. We've seen it going back 10 or 15 years, but nothing like this. This is as bad as it gets with leans on cars for car buyers that are innocent victims of some scammer, whether it's a private sale, a dealership, or even an auction. Leaning on a car is something you have to overcome. Fortunately, there are pathways to approach it. You want to make sure you pursue those so you're not out of luck and out of money.