If you’re planning on buying a car (or selling one, in which case, howdy!), then there’s one very important piece of paperwork you need to keep on top of: the title.
A title is a record used by the DMV to keep track of who legally owns each car on the road.
When a car changes hands, the title needs to be updated. Sometimes this is a pretty simple process, like if one family member signs over the title to another. If you’re buying a car with an auto loan, then the lender might jump in as the title owner. Whatever the reason, when a vehicle changes hands, the title needs to be properly transferred.
If someone buys a car, and sells it without first adding their name to the title, it’s called “title jumping”. It’s a felony in most states, so you want to watch out for this. .
And even buying a car without an updated title can make you complicit in the offense of title jumping. If a car is changing owners without the DMV knowing, then the purchasing party is not privy to the honest history of the vehicle. Whether you know it or not, you could be buying a stolen car.
If you’re buying a new car, the first thing you should check is that the car title is in the name of the current seller. If the names match, you’re good to go. If you find yourself looking at an open title—with a different name as the seller and the buyer’s name missing—then you probably want to think twice about going ahead with the deal.
Car titles can be left open by mistake, but it may be that the seller doesn’t want to reveal the history of the vehicle. Even if it’s not stolen, it could have flood or salvage status. Sometimes the seller is trying to save money by not registering as a licensed dealer. Or wants to avoid paying taxes.
If you’re selling your car, you can protect yourself from title jumping by keeping records of the sale. You may also want to contact the seller in due course to check that they’ve transferred the title correctly.
If you discover you’ve been title jumped by a private seller, then the first thing to do (assuming that you think it’s an innocent mistake), is to contact them to request they transfer the title to their name, then sign it over to you.
If the seller was phony, and has cut and run, then you should contact the DMV and ask for a bonded title. This allows for a period of time in which a claim can be made to the title, after which you can apply for a clean title of ownership and breathe a sigh of relief.
In some cases a dealership will be involved. If this is the case you could claim a refund, or take legal action against them.
But if you ask us (or anyone) the best option is to avoid running into title-trouble in the first place.
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