The Expert Podcast

If you have a vehicle that you're looking to claim because of repairs or maybe storage, we're going to take a look at two options of doing it. One is a mechanics lien and one is a civil lien. This is going to be a long video. We're going to get into the differences between the two, the pros and cons. Many times, a client will initially want to go to a mechanics lien, but in most cases, a civil lien is a better process. We'll take a look at why that's the case and when it's better to go with a civil lien than a mechanics lien. But you have both options.

First of all, what is a mechanic's lien? A mechanics lien is when an automotive business uses its license to go through the mechanics lien process to recover funds owed on a vehicle for repairs, storage, towing, and some other fees. Now, in most states you are required to be a licensed automotive facility to do this. However, we're going to take a look at an example here in Washington State where you don't need to have a license, but there are some other requirements.

The mechanics lien process is powerful because it allows you as an automotive repair facility to recover losses from a customer that just doesn't pay their bill. But it only goes through the DMV. It doesn't escalate it above the DMV. If the Department of Motor Vehicles or titling authority can't issue a title because of restrictions, then it fails—and then a civil lien might be better.

A civil lien goes over the head of the DMV. You're going to a heightened authority—that's the advantage of a civil lien. The civil lien doesn't require you to meet the criteria of the Department of Motor Vehicles or the title authority. It goes through a higher power which can force the DMV to do what you want to do.

So let's take a look at first the mechanics lien and the limitations, and then after that, why a civil lien might work. Here's an example from the Department of Washington Licensing: Vehicle/Vessel Chattel Lien Sale. "Chattel lien" is what they call it. It's to claim the right to sell or ownership of a vehicle if you've not been compensated for services and materials you provided for the vehicle at the request of the registered owner. That's key.

You must follow the requirements of RCW 60.08 and WAC 308-56A. We'll take a look at those. To apply for a title, take the following to any vehicle licensing office: this form of vehicle title application, a certified copy of the chattel lien filing with the County Auditor's recording office—that's something you have to do, you have to file that lien with the county recording office.

You also have to send copies of letters certified to all owners of record notifying them of that chattel lien. And this is important because if you try to apply for this title and you haven't filed that chattel lien with the county office and you don't have copies of letters sent by certified mail, they're going to reject it.

So how do you fill out the form? Well, you check off vehicle year, make, model, VIN number, “I have filed a chattel lien with the County Office of…” whatever county. Affidavit of service by mail under penalty of perjury—this is correct. And you have to sign this. If it turns out later any of this is not true, they can revoke the title, so make sure it's correct.

Now what about these requirements under the law? Well, here's WAC 308—Chattel lien. What is a chattel lien? What documents are required? You have to complete the affidavit—we know about that. Copy of the lien—we know about that. Copy of letters. Affidavit.

When is a court order required to issue a title as a result of a lien? A court order is required when someone other than the owner of record requested the services. This is key. If your permission to work on the vehicle was given to you by somebody other than the registered owner, you cannot do a mechanics lien. You have to do then a civil lien, which is more powerful—but it's just something else you have to do.

If there's no record on file with the Department, you have to do a civil lien. What does that mean? Well, if the vehicle was not last titled in Washington or in the state where you are, you can't do a mechanics lien. So those are two key triggers that mean you can't do a mechanics lien—you have to jump to a civil lien.

What else do you have to have? Well, this is important. Auto repair facilities in Washington State—you do not have to be licensed to be an automotive facility. You have to be legitimate, but you don't have to have a license. But you do have to have a sign that says you're allowed: a written estimate, return of parts, authorizing writing repairs.

Written estimate for repairs which will cost more than one hundred dollars. So you have to have a written estimate given to the customer, and it requires the sign being letters one and a half inches high. So if your repair facility doesn't have this sign that says what these rights are for the customer, you can't do a mechanics lien. So make sure you have that sign.

And then make sure that you know that the registered owner is requesting the services. If Joe Schmoe brings in a car and it doesn't belong to them and they say, "Fix the transmission for three thousand," well, you can't do a mechanics lien. You have to jump right to a civil lien.

Remember too, we're not attorneys—we're not giving you legal advice. If you need legal advice, you should contact an attorney.

So let's say you can do a mechanics lien—great. Fill out this form, fill out a title application (which is a similar form). See if it shows it here… another form you fill out: vehicle title application—year, make, model. You need to put your name as the new owner or whoever buys it at your auction. You submit all that to the DMV along with the copy of letters and you get your title.

What if it fails? What if the owner of record didn't authorize the vehicle, or what if there's no prior title? Now you jump to a civil lien.

A civil lien sometimes is called a court order title. Sometimes it's called a magistrate title. And here's an example of how that works: You file in the court, whatever county you're in, a matter for certificate of title for a motor vehicle. And you petition for a court order directing the clerk of courts to issue a title for a motor vehicle.

Basically, you're going over the head of the DMV and having a judge or magistrate or the court tell the DMV: "You give this person a title, you give this company a title." And in support of the petition, you attach an affidavit setting forth the circumstances—how you came into possession of the vehicle. What are the facts that support that title? And you sign it. Affidavit again—you have to say this is all true. You can't make stuff up.

There’s a few other criteria you need to meet. Every county does this differently—there’s 3,611 counties in the country. You have to abide by whatever goes in your county. Also remember, there could be no assurance that a court order will be granted. Usually it is. If you're legitimate and you go to court and you have the right paperwork, you're probably going to get your court order. But if you're trying to do something sketchy, it's not going to work.

What should you attach to the petition? Well, refusal or denial from the DMV. So if you go through this process and you don't get your title on a mechanics lien and you're denied, you want to attach that denial to the petition so they know you already tried the other way.

You have to attach a copy of the record search report from the title office. So you have to run a title search. You may have to do—in this county they require—an inspection of the vehicle, correspondence and certified mail receipts. Sound familiar? You have to do that over here, right? Copies of certified mail. So you have to do the same thing here. You already have those copies.

If you have any additional documentation—receipt, bill of sale, cancelled check, the repair estimate that you got from the owner or from their representative—evidence you believe necessary to support your claim. Look, whatever story you're trying to tell of why you deserve a title, make sure you have documentation for that story because that's going to be what the court uses to make their determination. And again, normally they will if you're reasonable. But you want to make it so there's no question and they don't have to guess about why you're trying to get a title.

What will you get from the court? Well, you will get a judgment entry granting the petition for court order directing the court to issue a title for the motor vehicle. "This cause was considered by the court..." asking the court to order a title for a motor vehicle in the petitioner's name and has information about the vehicle—make, model, year, VIN number. The court finds the petitioner has complied with the requirements, and the evidence is sufficient to require a certificate of title to be issued in the petitioner's name.

You are the petitioner. So remember: evidence to be sufficient—that's the key. You want to make sure you submit sufficient evidence to have the court say, “Yeah, this is a no-brainer.” The court orders that the auto title department issue in the petitioner's name a motor vehicle certificate of title for the vehicle. "Court orders"—big letters—orders. That means that you can come in and you slap down on the counter at the DMV and they have to give a title.

So you're going over the head of DMV to get this done. Look, Department of Motor Vehicles or the title authority in your state—they have certain limitations. They just can't hand out titles like candy. They have to have certain procedures met. And even if they want to give you a title, if your story sounds legitimate, if you don't meet their procedures, they're not going to give you a title. This gives them the authority to do even what they want to do. It is an order: "I order you to give a title"—that’s what the court says.

So that's what a civil lien is. When the vehicle is in possession of a civilian, private party, or a mechanic that doesn't qualify, the applicant may file for a civil lien. It bypasses DMV requirements and the court signature directs the titling authority to install the applicant as the legal owner.

And you can do this in all 50 states. It may seem like too much trouble, but let me tell you something—how much trouble is it to go through DMV with all this stuff, right? It just gets it all done in one fell swoop. You're not dealing with getting the runaround from the DMV. You're going over their head and getting a court order to get a title.

And that's what you want. You're putting the power of the court on your side rather than fighting against the bureaucracy of the DMV. And you'll read more about it on the website leantitles.com. We'll give you some more information about how to go through that process, instructions, and even services to help you.

Mechanics lien or civil lien—your choice. They're both good. They're both powerful. Pick the one that works best for your scenario.