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On another thread someone mentioned "title" Please tell me everything one ought to know about the title. I've never owned a car and someone said that you have to pay for the title when you buy a car.
A title is basically a government record stating who is/are the legal owner(s) of a car. This serves several purposes such as clarifying ownership claims, establishing a creditor lien if there's a loan on the car, determining possible financial liability in an accident, assuring a second-hand buyer that the car is not stolen property, etc. It can also provide very basic information about its history, such as a clean title versus a salvage title.
When you buy a car, you will be required to obtain a title if you intend to use it on public roads. Even if you don't intend to drive it on public roads, it's still a very good idea to get it titled anyway to establish a clear chain/claim of ownership. The cost of obtaining a title varies from state to state; I can only tell you that here in Illinois it costs $95.
The last time I boought a car, I had a car loan through a bank. When I made my final payment, the bank sent me the loan document I had signed stamped PAID; and the title to my car, stamped "Lien Satisfied". This is in Pennsylvania
The last time I boought a car, I had a car loan through a bank. When I made my final payment, the bank sent me the loan document I had signed stamped PAID; and the title to my car, stamped "Lien Satisfied". This is in Pennsylvania
That's my experience in both PA and MD. I would imagine most states are similar.
It is the equivalent to a Deed on real property. It is a document that describes property (in this case, a vehicle) which asserts the legal owner of the property, and is filed in a centralized registry. The state incurs a certain cost in maintaining this public registry, and the owner of the property pays a small one-time fee (less tha $100) to defray that cost.
Each time a vehicle changes owner, the new owner turns in the previous title document, and has a new one reissued in his name. There is near perfect portability and reciprocity among states, who all recognize each other's titles since it became s universal practice in the 1970s.
As was explained, a title is simply a piece of paper showing who owns that specific vehicle. It spells out certain information about only that one vehicle, like it's vehicle identification number, year of manufacture, weight, and things like that.
When you sell it or trade it in you sign off and the title can then be passed onto the new owner. Titles vary State by State, some did not even use titles before a certain year. They just had a bill of sale that you kept for proof.
Beyond the title is the "registration." This is between you and the State you live in and is done when you want to acquire plates so you can drive it on the roads in that State.
That's my experience in both PA and MD. I would imagine most states are similar.
It is that way in 'Title holding' states, in 'Non-Title Holding' states, when you buy a vehicle on credit you still get to hold on to the title except that it has a lien on it. When you pay it off you get a release of lien statement or you can take it to your bank and have them sign off saying it's paid off.
I had mentioned the title in your thread on the Ford Escort because sometimes these documents can present big problems in the transfer and registration of a used vehicle. The things I had listed were scenarios that had jumped into my mind. However, I am not now, nor have I ever been a car dealer, so I'm sure there are other possible bad scenarios.
Here's a better explanation of the problem situations that I've encountered over the years of buying used cars and trucks. I'm sure there are others:
1. Divorce - A man or a woman is selling a car and has the title in hand. However the spouse has "skipped" the country and no one knows where they are. The possible problem is that title states that the husband and wife both own the vehicle so both have to sign it to release their ownership.
Another scenario: Grandma, now deceased, gave the car to the person and the title is still in her name.
FURTHER POINT: Keep in mind that, if the title says John Smith or Jane Smith, either spouse can sign but if the title says John Smith and Jane Smith, both have to sign it. In short, make sure the person who hands you the keys and the title are the same person who needs to sign and release the title.
2. The title has to be the real and negotiable title. Sometime banks will issue a non-negotiable title before the car is paid off. Some people are extremely bad bookkeepers and will misplace their real title once the bank mails it to them at payoff.
3. Make sure there are no liens showing on the title as outstanding.
4. A salvage, or rebuilt, title substantially lowers the resale value of the vehicle for its lifetime because it means the car has been wrecked (or otherwise harmed) to the point of being considered a total loss by an insurance company.
it's about a little smaller than a regular piece of paper.
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