Unlocking Title Issues: How Lien Releases Cause Major Title Problems
Download MP3Episode Overview:
- A Kansas dealership faces a major issue with failing to provide titles to car buyers.
- The dealership also failed to pay off outstanding loan balances on trade-ins, leaving consumers with multiple car payments and no titles.
- Allegations suggest the dealership sold vehicles without paying off the trade-in loans, causing serious complications for both buyers and sellers.
Key Points:
- 87,000 Default Judgment: The dealership in Kansas faces a default judgment due to title issues and unpaid loans.
- The 'Out of Trust' Issue: Some dealerships avoid paying off trade-in loans right away, risking double-dipping by selling the car without settling the debt.
- Risk to Buyers: Buyers of these vehicles may find themselves unable to obtain the title because another bank holds it due to unpaid loans.
- Impact on Trade-ins: If a trade-in loan isn't paid off, it affects the seller's credit and title, potentially causing long-term issues.
- Lien Release: The importance of a lien release document in vehicle transactions—without it, a car's title can't be cleared, even if the loan is paid off.
- Red Flag for Dealerships: Dealerships with title problems often have lien release issues, which should be a key indicator when addressing title problems.
Takeaway: Always ensure that any liens on a vehicle are properly cleared from the title records before buying or selling. Dealerships should be transparent about the lien release process to avoid future complications.
