Lien vs. Title: Understanding Vehicle Ownership and Legal Rights

The Expert Podcast

• What is a Vehicle Title?
  • A vehicle title is a legal government-issued certificate that proves ownership.
  • Titles are issued by state agencies such as the Department of Motor Vehicles (DMV) or Department of Transportation.
  • It is a physical document, not something you can download or print from the internet.
• What is a Lien?
  • A lien is a claim against the vehicle's title, typically by a lender.
  • When you finance a car, the lienholder’s name appears on the title to protect their interest.
  • The lien must be cleared (lien release) before you can get the title in your possession.
• Lien Release Process
  • The lienholder must sign off to release the lien once the loan is paid.
  • Many times, lienholders don’t notify the DMV after a lien is cleared, leaving the title record still encumbered.
  • Lienholders avoid updating DMV records due to the costs associated with filing lien releases.
• Challenges with Liens and Lien Releases
  • If you lose the title or sell the vehicle without clearing the lien, the DMV still shows an active lien.
  • For charge-offs, write-offs, or bankruptcies, lienholders don’t notify the DMV, keeping the vehicle title encumbered.
• Steps to Get a Lien Released
  • Send a lien release request package to the lienholder with all necessary documents (affidavit, letter of non-interest, etc.).
  • Avoid phone calls or emails; send the package by mail, including a pre-stamped return envelope.
  • Make the process easy for the lienholder to avoid delays.
• What if the Lienholder Doesn’t Respond?
  • File a court petition for a court-ordered title in the county where you live.
  • Show proof of reaching out to the lienholder and their lack of response.
  • The court can then declare you the owner and order the lien release.
• Common Misconceptions
  • Financing a car doesn’t mean the lender owns it; you are the legal owner.
  • The lienholder only has a claim, not ownership of the vehicle.
• Resources Available
  • Visit our website for resources, checklists, and videos to resolve title issues on your own.
  • We offer title services, paperwork assistance, and consultations with certified title experts.
• Need More Help?
  • Book a video call, use chat services, or consult a title expert through our website.
  • Watch other videos on our channel for more information on resolving title and lien issues.
• Reminder
  • Always ensure liens are cleared from the title record before transferring ownership.

For more detailed guidance and to explore title services, visit our website.