After my mother passed away, my father gave me her 2002 Nissan Sentra. Six months later, I was still struggling to get it registered correctly, all because of the way her name was listed on the car's title. While this is an extreme example, it shows how difficult it can be to sort out the complexities of motor-vehicle regulations.
My 10 years spent buying and selling cars for Edmunds.com's long-term test fleet should have prepared me for this Department of Motor Vehicles (DMV) impasse. I've spent hours untangling the DMV registration processes and trying to avoid just such title problems for the test cars we've bought. But even an expert can be stumped.
Here's what I've learned this time around: While each state has its own specific requirements, it always boils down to being able to prove ownership. Using that concept as a guide will help anyone find his way through this bureaucratic maze at the DMV.
A document called the title (also called the "pink slip") proves you own the vehicle. Providing a "clear" title — which means one without loans attached — is the bedrock of any vehicle sale or purchase.
When you buy a car at a dealership, the dealer files the registration papers for you. If you're buying or selling a car yourself, you'll have to deal with your state's DMV, which can go by a variety of other names, such as registry of motor vehicles. If you have all the documentation of the sale or purchase — and the forms are signed correctly — things should go smoothly. But there are situations where ownership is hard to prove or signatures are impossible to obtain, such as in my case. Then the frustration begins.
Since DMV laws vary by state, this article can't possibly cover all the details of buying and selling vehicles. All DMV Web sites for the various states are listed at the end of the Edmunds.com article What New Car Fees Should You Pay? so you can get specific information about the requirements in your state. Below I will cover, in broad terms, the two most common tasks: buying and selling. I will also offer some tips for resolving more complicated situations, such as the difficulty I faced registering the Sentra.
When You Buy a Car
Before making a deal with the seller, find out from your state's DMV Web site exactly what documentation you will need to register it. In most cases, you must provide a clear title that is signed by the seller. The seller's signature releases his ownership of the vehicle and it can then be transferred to you. In many states, you will be required to pay sales tax on the car before you receive the current registration and, later, the license plates.
In some cases, the car you are buying might also have the name of a bank or other lender on the title. That means there is a lien (or loan) on it. To get the bank to release ownership, the loan balance must be paid off and a bank's representative has to sign the title.
When You Sell a Car
When you sell your car, you need to provide a signed, clear title to the buyer. In California and some other states, the back of the title acts as a bill of sale. It has a space for the names and addresses of both the buyer and seller, along with the purchase price of the car. In California, the seller must also provide a smog test for older cars.
Once full payment is received from the buyer, the only other thing you need to do is file a "release of liability" form, which is often available online. This tells the state's DMV what the vehicle's odometer reading was when the sale was completed. If the new owner has an accident, you are no longer liable for damages.
When Things Get Complicated
Some poor souls — like me — find themselves in what seem to be no-win situations with a DMV. You do have some options for help, however:
Auto Clubs: In 18 states — including California, Connecticut, Massachusetts, New Mexico, Rhode Island and Texas — the American Automobile Association can perform many DMV services, thereby helping people avoid the long wait times common at registry offices. At the Automobile Club of Southern California, for example, representatives are trained in DMV tasks and can assist members with registering a car, applying for a duplicate title and many other transactions.
"Our members find these services to be real time-savers," says Elaine Beno, a spokesperson for the Auto Club. Recently, she went to a branch office for a registration. "I did it all on my lunch hour," she says.
Beno said the key to resolving sticky problems is to speak to a DMV expert at an Auto Club office who knows what forms are available to address such unusual situations as deaths, lost titles or even mistakes on existing titles. "We have specialists that get the right forms submitted in the right combination," she says.
Insurance Agents: Consumers might try turning to their insurance agents for help. Pete Moraga, spokesman for the nonprofit Insurance Information Network of California, says insurance agents often work with motor vehicle departments, which gives them insight into how they work. "I highly recommend consumers talk with their agents," he says. "They know your policy and what you need and will help you if they can."
My father's insurance agent was very helpful in resolving my problem. She steered me to a form I had never heard of: the "affidavit of surviving spouse." Once my father signed it and filed it with the state of Massachusetts, the state reissued the title in my father's name only. Once he had signed it over to me, I had everything I needed to register the Sentra in California.
Third-Party Agencies: Depending on your state, you might find help from a third-party agency. Try doing an Internet search that contains the phrase "vehicle registration services" and the name of your city. Ian Grossman, spokesman for the nonprofit American Association of Motor Vehicle Administrators, recommends visiting your state's DMV Web site to see if this option is available under the laws of your state.
The DMV Itself: There's no doubt about it, DMVs have a bad reputation. But for involved questions about motor vehicle laws, the DMV is sometimes your only alternative. State DMVs typically have phone lines staffed with representatives who can answer questions. But all too often, the hold time is lengthy, and the DMV agents speak in shorthand that the public can't easily understand. In some states, though, things are changing.
Grossman says he has seen an improvement over the past decade in the services offered by DMVs in most states. "Across the country, there has been an extreme focus on modernizing and improving the customer experience," he says. This includes a trend toward handling transactions and services online or through the mail to minimize in-person visits to agency offices.
California offers an example of some of those improvements. The state's DMV has downloadable forms at its Web site, instructional YouTube videos, self-service terminals at DMV offices and a new mobile phone app.
"The DMV is one of those places that people love to hate," says Jamie Garza, information officer for the California Department of Motor Vehicles. "But we know your time is valuable and the last thing you need to do is wait in line."
Applying that to phone transactions, California has introduced "virtual hold," where a caller leaves a name and number and gets a call back within a stated amount of time. This avoids long, uncertain hold times. I put the system to the test, and my call was returned in 20 minutes by a DMV employee who was both knowledgeable and sympathetic.
Avoid Problems by Thinking Ahead
Here are some tips on how to make things go more smoothly at the DMV when you're buying or selling a car or changing the title:
- If you are selling a vehicle, locate the car's title and make sure all liens have been removed by paying off the loan and getting a bank representative to sign the title. When potential buyers call, tell them you have a clear title.
- If you are shopping for a vehicle, ask the seller if he has the title in hand. Also ask if he's removed all liens on the car.
- If there is a lien on a car and you still want to buy it, call the lender to find out how to transfer the title to your name. Make sure this is possible before you agree to buy the vehicle.
- If there's a second name on the title, such as the name of a bank, the signature of a representative from that institution should be on the title, too.
- Consult your state's DMV site to find out how to correctly sign and date the title. If you make an error, DMV forms are required to correct it.
- Don't date the title until you are positive that the sale or purchase is final.
- If you're dealing with a DMV agent whom you feel is misinformed or inexperienced, politely ask for a supervisor.
Perhaps the most important tip doesn't have anything to do with paperwork or regulations, however. It's about attitude. "If you can be patient, that will help a lot," Beno says.
To find a dealership that knows how to treat shoppers right, please visit Edmunds.com's Dealer Ratings and Reviews.