Few things compare to the excitement of a new car. Many buyers know to ask questions about the history of the vehicle, some will visit a trusted mechanic to have the car inspected. These methods are excellent choices that can reveal serious mechanical problems; however, it is less common that buyers ask questions about the vehicle’s title. These questions may help avoid the stress of title work problems that can waste time and money.

When it comes to purchasing a vehicle, buyers commonly purchase from a dealership, or from a private party. A dealership is in business to sell vehicles and is able to complete the titling process for the buyer. A private party is an individual who is selling his or her vehicle. When purchasing from a private party, the buyer typically must visit their local DMV office to pay the applicable taxes and fees, at which time the title work is completed by transferring ownership. Before purchasing a vehicle through a private party, several questions should be asked about the title and current ownership.

Do you have the title on hand? If the owner has the title, ask to see it before making the purchase. If the title is lost or misplaced, the owner may be able to apply for a duplicate at their local DMV office.

Whose names are on the title? Is everyone listed on the title available to sign a bill of sale? If the relationship between additional names on the title is “OR,” only one of the owners must sign a bill of sale. If the relationship is “AND,” all owners must sign.

Do you currently have any loans or liens against the title? If not, have you ever had any loans or liens against the title? If the title is not on hand to confirm, this is an important question to ask. Before applying for a duplicate, the title must be free of liens.

Is the vehicle currently financed under a lease agreement? Each leasing company has different requirements to “buy-out” a lease. Before considering the purchase of a currently leased vehicle, you should understand the leasing company’s requirements. It is also important to note that a leased vehicle is commonly titled in the leasing company’s name - not the seller’s. This may cause you a delay in the registration process, or cost additional taxes or fees.

Which state is the vehicle titled in? If the vehicle is not currently titled in your home state, there may be additional steps required by the DMV to title in your name, or to apply for a duplicate. If the title is not on hand, and the owner is unsure, ask if they have lived or owned property in any other states during the time they have owned the car. If the vehicle is currently titled in another state, contact your local DMV office to inquire about the requirements.

Is the Title Branded? A title with a “Rebuilt/Restored” status may indicate previous extensive repair work that may adjust the car’s value.

To obtain assistance with any of these questions, your lender may be a valuable resource. Contact us to apply for a pre-approval on your next auto loan. When you find the perfect vehicle, our lending professionals can guide you through the titling process to save time and money, putting you in the driver’s seat of your next car.