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Mechanics Liens & Bank Lien Releases For Car Titles

  • 7 min read

One of the most common questions that comes to us has to do with vehicle liens.

It could be removing a lien from a vehicle title record, for example an old paid off car loan or a charged off car loan or a loan that shouldn’t even be on the car. 

Another lien question that comes up is a mechanics lien.

Can you use a mechanics lien to get a title? and there’s some very important misconceptions that people have that at the very least could keep you from getting a title and have you be rejected.

On your title transfer at the worst that could create legal problems look most people don’t intend to do anything illegal or get in trouble but a lot of times there are urban legends or online forums that tell you, you can do certain things that might end up getting you into trouble.

So let’s first talk about a vehicle lien and a vehicle title with a lien on the record and figure out what that is.

First of all a vehicle title as you know is a legal document, right? This is a title for a vehicle and it’s a certificate that’s issued by a government agency. Most states they call it Department of Motor Vehicles or DMV something like that and that state agency keeps track of and issues vehicle titles. Now if you purchase that vehicle and when you bought it you’ve got a car loan from either the dealership a manufacturer or a bank or somebody like that.

Let’s say you got a car loan from Chase or from Toyota Motor Credit that lender is going to put that lien record on your official title history, it’s going to go into the government agency record system so that your title will say right on it lien Toyota Motor Credit.

In fact, in most cases they won’t even give you the title because that’s being held by the lien holder in most States so as long as that lien is on the record you can’t sell it, transfer it, sometimes you can’t even get the title because the bank owns it. 

What happens when you pay that off or it’s a charge of and now you have to get it removed from the title record?

Well, in most cases let me back up in some cases the bank or the lien holder will actually take action to remove that lien from the title record they’ll either send a document they’ll do it electronically or they’ll sign an affidavit that the DMV will use to take it off the title sometimes they give that document to you and then leave it up to you to remove it from the title sometimes all they’ll do is they’ll take that title certificate sign it stamp it paid and send it to you but they’ll never clear it off the title record that’s a problem because if you lose that one single piece of paper now you’re out of luck so how do you take it off? Well in almost every state the process goes like this some lenders have a direct Electronic Connection to the official DMV records where they can electronically type it in hit enter and it clears it.

Sometimes they require a piece of paper and that’s more common that piece of paper is called a lien release document it’s an official form from the DMV that releases that lien from the title record which clears your title and now you can sell it trade it do whatever you want. How do you get one of those? Well we’ve talked about it before and don’t forget in a minute we’re going to talk about mechanics liens and what that means and how to do a mechanics lien if you can because the mechanics link can also result in a bank loan being removed from a title, right that can happen.

So how do you get a lien release?

Well, first thing you do is you see if you already have it from the lien holder if you don’t have it you need to get it from the lien holder, the lien holder Bank financial institution whoever they have to sign that form you can’t just print it out yourself and submit it has to be signed by somebody who’s verified from the lender.

So what we recommend is don’t just call up your bank and say hey give me a lean release don’t email them, don’t fax them, don’t text them, don’t send them a Facebook message because in most cases ain’t gonna work the bank is either gonna forget about it, they won’t do it that whoever you talk to on the phone that’s not their job and they’ll get lost in the shuffle fall through the cracks so what should you do?

What you should do is you get that document that form print it out?

It’s a one-page form fill everything in you can, what you can’t do is you can’t sign it, mail it to the lien holder with a little arrow sticker saying hey sign here we’ve talked about this before but we’ll go through this again, put a return envelope so that they have a place to send it back to, they don’t have to do any work put a stamp on that envelope to mail it back to you, that way somebody gets it all they literally have to do is sign it, lick the envelope, boom it goes back to you.

If they have to do any more work than that, it’s possible and likely that that employee at that bank, at that financial institution is just going to say well maybe I’ll do it later maybe, I’ll throw it away or maybe I’ll pass the book to somebody else because I don’t feel like doing it because all these people are doing some other job they’re not a lien release department just sitting around waiting to do this.

What about a charge off?

Well if you do that same thing many times what happens is that employee pulls it up they get the VIN number they type it in, yep charge off sign it send it back.

Now your lead is released because the charge off technically means it’s off their books so it should be released they’re not going to take it off the DMV record unless they have an easy way of doing it. So charge off takes it off in fact one of the things you want to do sometimes people ask us well should I send a certified mail don’t send a certified mail because that’s going to probably end up going to the legal department of that lender which means there may be higher scrutiny it’s going to go to some higher level executive higher scrutiny if you just send a regular mail it’ll go to some clerk, they look at it charge off you up sign it boom you’re good that’s how you do it that’s how we do it we send out a couple hundred of these a week for clients, that’s how you do it now.

What about a mechanics lien change the subject change gears?

Well a mechanics lien for those who you don’t know most of you do who watch our channel is a process where a licensed Garage repair shop storage yard can file a lien on a vehicle that’s been brought in for repairs brought in for towing brought in for storage and somebody didn’t pay the bill and that mechanics lien allows them to sell the car to pay the bill right and it also clears off any prior liens even if those liens aren’t paid so if there’s a lien that’s paid that’s still open with Toyota Motor Credit somebody owes ten thousand If the mechanic does it the right way, it removes that however here’s the thing, there’s a lot of fraud that goes on with.

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