The Expert Podcast

Every year, we have a few conversations with some directors, assistants, and commissioners of various departments of motor vehicles across the country just to get a sense of what's happening in their world and what's happening in the public sector of vehicle titles and registrations. The theme that's coming up now is transitioning to electronic digital titles, although that may be a few years away. The other theme is making sure that title applicants and registration applicants are abiding by the rules. There was a lot of fraud that went on over the last really decade—a lot of loopholes and back doors that people are using that are now shut down. But also with regard to COVID, there were a lot of exceptions made for titles in 2020, 2021, and even the beginning of 2022, where people were allowed to do a few things with titles that may not be allowed today, even things like inspections and proper documentation.

More states are now having their Department of Motor Vehicles offices do official recommendations for court-order titles or bonded titles. They're advising their clerks at the windows of the different satellite branches to talk about that. Another big change with the Department of Motor Vehicles has to do with salvage titles and partson titles. Many of these cars are being sold by Copart or IAA. These cars are really designed to be sold to automotive businesses, body shops, dealers, and auctions. They're not designed to be sold to the general public. In fact, most of the auctions that sell salvage vehicles do not sell directly to the general public. There are some workarounds for that. There's a few bidding companies that you can bid through a dealer to be able to buy a Copart, but the reason that they prefer not to do that is because there's a lot of little things that can trip you up. Maybe half the cars that you buy as salvage through Copart or IAA you can eventually put back on the road; you get them inspected and get them fixed up, but about half of them will never be able to go back on the road.

Some of them are sold as parts only, and some of them have repairs that are needed but cannot be done. Things like frame alignment, sometimes computer codes are thrown that can't be fixed, many times airbags have been deployed, and in some cases there's corrosion that has existed from things like water intrusion from a flood. Those can't be fixed, and even if they can, the cost to do it is more than just buying a new car, and that title will always be branded with Salvage. So the DMVs are really being more meticulous about these inspections to make sure they're safe for the road because there are more instances of these cars coming back and having problems later.

The last thing that we see with DMV developments is that they're now starting to coordinate between the different states. Look, every state has a titling authority. In most states, it's called the Department of Motor Vehicles; some states call it the Department of Transportation; and in Pennsylvania, some states call it the Bureau of Motor Vehicles. It doesn't matter what it's called; it's all the same thing; it's the state agency that issues titles and registrations. They all operated separately in different states, but now the states are starting to work together and coordinate. They're starting to share their data to cross-collateralize some of their record systems so they can see what's happening with these vehicles coming from other states because people used to like to jump around different states to try to evade different types of rules. So the DMVs are now working together closely; that's something you'll see more of with more computerization. Maybe AI will help cross-reference these VIN numbers, so that's what you can expect for titles going forward.

Again, we work with the DMVs constantly to get an idea of what their procedures are, what they're wanting to accomplish, and what they're trying to do for the general public. Look, we know that DMV getting titles is a bureaucratic problem. When you go to the DMV, it's not easy. Look, they make punchlines on sitcoms and movies about the DMV. We know it's hard to deal with, but it's because they have an important job. When you get a title for a vehicle, right, a title is a legal government document, it's a certificate, we've talked about this before looks something like this when you get handed one of those with your name on it it's not just a piece of paper it is a confirmation of your ownership of the vehicle and if the DMV hands you a title in effect they're handing you dollars in the amount of the that vehicle so if that vehicle is worth $10,000 when they hand you a title with your name on it saying you're the owner in effect they're handing you $10,000 so it's just like you can't just walk into a bank and say give me $10,000 they have to have proof that you deserve to have it the DMV is required to make sure that nobody else is supposed to have that vehicle nobody else has rights to that vehicle nobody else has claims to that vehicle one way of doing it is to have the old title from the last owner signed over to you if you don't have that there's things you can do to get a title in your name but it has to be done through a certain procedure because the DMV can't just hand out titles arbitrarily bill of sale is not enough anybody can write up a bill of sale and may be one part of the process but by itself it doesn't prove that all of the rights of that vehicle are conveyed to you so be aware that it might be a little more difficult than you than you thought but a title is not just a random piece of paper that is meaningless it means that you are now been conveyed and granted the value of that vehicle vehicle and you want to make sure you do it the right way so it also can't be undone later if there was an error in the first place.

That's the update in the news for DMV developments for the beginning of 2024. We have another conversation with another group of DMV commissioners, executives, and managers, usually at the end of the summer in August or September, and we'll certainly keep you up to date about what the developments are then.