When Is A Title Transfer Necessary?

29 April 2016
 Categories: , Blog


When some people think of a title transfer, they think of purchasing a new vehicle. However, this isn't the only scenario in which you would need to contact your local DMV to have this process performed. If you're the owner of a vehicle, it's important to at least know when you need to transfer a title to ensure you are abiding by the law and protecting your vehicle.

Gifting A Vehicle

Thinking of giving your teen driver your old vehicle? Make sure you understand that the process isn't as simple as handing them the keys and telling them it's theirs – at least from a legal standpoint. There must be a legal transfer that shows a transition of ownership from you to your family member.

In the event your child or other family member decides to trade-in or sell the vehicle in the future, if the title has not been transferred, they will be unable to do so. Although the recipient of the gifted vehicle will not be responsible for paying sales tax on the vehicle, they will likely be responsible for a title transfer fee.

Loan Payoff

If you've made your last car payment and you are now the free and clear owner of your vehicle, you need to complete the title transfer process. This step is important because it removes the lienholder from the title, basically absolving them of any legal rights pertaining to the vehicle.

Generally, upon your final payment, the lien holder will mail a lien release form that you can take into the DMV to have their name removed. If you have not received this documentation from the lienholder, make sure you contact them to get this information right away so that you can update your title.

Name Change

Should you get divorced, married, or change your name for another reason, don't forget that your vehicle registration also needs to be updated. Failure to complete a title transfer will pose a number of challenges in the future. Similar to a family member transfer, you won't be able to sell or trade-in the vehicle and you might have issues when you go to renew your vehicle registration in the future.

To complete this step, you generally will only need to provide some type of legal decree that verifies the name change such as a court order, divorce decree, or marriage certificate.

It's important to understand that these scenarios represent just some of the instances in which a title transfer is required. Every state has different rules pertaining to this process so make sure you investigate the regulations in your state.

For car registration, contact a company such as B & K Auto Tags