An auto title is a legal document that proofs ownership of a car. It is one of the major documents that must be provided in transferring ownership or car title to a new owner. The basic thing that happens when a title is being transferred is that, the seller will release ownership of the car by signing the title. While the buyer will get a new registration and title from the state Department of Motor Vehicles (DMV).
When you need to sell your car, the title will be legally transferred to the new owner so that the person buying the car can file to get a registered. The car title is also referred to as the “pink slip,” this doesn’t mean it is always pink. Other information that will be found on the car title include name of the owner, Vehicle Identification Number (VIN), time of sale, mileage, make, and model of the car.
How Car Title Transfer Works
There are two steps involved in transferring a car title; one to be taken by the buyer, and the other by the seller. The first step is to be taken by the seller, the seller has to release ownership of the vehicle by signing the title. The buyer takes the signed title to the DMV in order to get a new title and registration. Although, some state might require additional paperwork like providing a transfer of ownership form, and bill of sale.
Signing your car title releases your ownership of the car. If you are buying the car from a dealer, the dealer will handle the paperwork and you will get the car title from your state’s DMV in your mail. However, if you are buying from a private seller, both parties will have to handle the title transfer by themselves.
The state DMV may also require the seller to provide certain basic information such as the odometer reading, and the sales price. Before you sign the title, check with your local DMV to know the line on which you will sign and how to ensure you provide the correct information.
Whose Name is Listed?
The first thing to do for the seller is to see how his or her name is listed on the vehicle’s title. If only your name appears on the title, it means you are the sole owner of the car and transferring ownership of the car is easier.
If you have a loan on the car, the name of your lender will also appear on the title. If there is a lienholder on the car, you will have to settle this before you can sell the car and things can get a little complicated but it is not so difficult. Pay off the loan on the car, and request for a lien release from your lender and this will enable you to sell the car. A car to be sold has to be lien-free to make the transfer of ownership easy.
If the car is owned by two persons, their names can be separated by either “and” or an “or”. If it is “and,” both owners will have to sign the title to release ownership but if it is “or” this means either owner can sign the title.