The Expert Podcast

So why does it seem like it's so hard to get a title for a vehicle? Why is the DMV giving you the runaround and making it seem like you're a criminal for trying to get a title? Well, if you purchased a vehicle without a title or you bought a vehicle at a lien sale or at an auction and you're having title problems, the reason that it seems so hard actually might not be as evil as it seems. Remember, when they're giving you a title for a vehicle with your name on it, it's not so much that you're getting a title, it's that somebody else is losing a title. Right? Because when a title is issued to you, that means that it's excluding all other owners as having claims to the vehicle. So by awarding you a title, it's saying that it's your vehicle and it's nobody else's vehicle.

Why is that important? Well, here's an article from Texas where companies were accused of illegally selling cars owned by service members. These are military people, and this has less to do with military service as it does with the titling process. By failing to obtain a court order before auctioning the vehicles, defendants prevented service members from deciding whether a lien sale of the vehicle should have been delayed.

So here's the thing: First of all, a court order title is definitely the way to go. All of the other methods, like the bonded title, the Vermont loophole, or prior owner contact, you can do all those. But the best method to get a title is a court order title. And it says right here in this article, court order title is a very powerful method, and you can read about that on the website.

But here's the thing: There may be claims against the vehicle that you may not be aware of. Maybe you bought it with a bill of sale. Maybe you bought it from somebody on Craigslist. Maybe the seller didn't give you a proper title. Before the DMV gives you a title, they want to make sure that all other ownership is extinguished. And here's the reason why: because if it's not, your title is in jeopardy. All the people that bought these vehicles, these 176 vehicles, without a court order, they may get their titles revoked. They may have paid good money to this towing company and lose their car because they never get a title.

So it's incumbent upon you to do the harder work to get a title so you don't have to worry about your title getting snatched away or never getting a title at all. Going through the right process will make sure that all other ownership claims are extinguished—any liens, any prior owners, any probate, any civil actions. And if you do something like a bonded title, your title is at risk of being taken away. If you do other types of loopholes or other backdoor ways of getting a title, you could get revoked as a registrant for the vehicle. Doing the proper title paperwork to begin with might be a little bit harder, but it's really even not that much harder, and you don't have to worry about your title or your vehicle being lost or seized.

This is not taken lightly. This was investigated by the U.S. Department of Justice, right? And that's as high as you can get. That's not local police or state police. That's the federal government, DOJ. That's where the FBI is. And this person, her vehicle was towed, and it was sold at auction for $6,200, and she still owed $13,000 on the loan, which she still has to pay off. And she didn't have a vehicle. And the buyer paid money and never got a title from this towing company, allegedly.

The problem is that without going through the right process, whether it's a mechanic's lien, a court order, or something else, the buyers are at risk, the sellers are at risk, and even the last owner is at risk. By going through the right title process, in this case, a court order title, you eliminate the possibility that your money is going to be spent on a vehicle that you can never get a title for. You don’t have to use a loophole or some kind of bonded title or something that might come back to haunt you later, and you don’t have to worry about some prior owner coming and saying, "Hey, that’s my car, here’s my title, and I want it back."

A bonded title is something people think about a lot. But here’s the thing about a bonded title: If you get a bonded title, let's say on a $10,000 vehicle, you have to purchase a surety bond. The bond might only cost you $100. It’s not like it’s a big deal. But if somebody comes forward later and they say, "That was my car. It was transferred improperly—maybe a bad lien sale, maybe the mechanics lien or towing company didn’t do the right paperwork—I want my car back." You have to come out of pocket. First of all, the bonding company will pay them off. The bonding company pays that claim, but then they come after you and say, "You have to pay us back." It’s not like insurance. When they pay a claim, you're off the hook. A surety bond is something where, when they pay a claim, they go back to the original bondholder, and you have to pay them back.

So you can eliminate that by doing a court order title or magistrate title or a civil lien to get it done right the first time and avoid problems like this, where 167 cars have had titles revoked and are being investigated by the U.S. Department of Justice, and there could be potential legal liability down the road, and maybe even losing your car.