Acquiring a vehicle title’s lien release from a failed bank is an uncommon matter, but one that needs to be rectified in order to transfer ownership of the vehicle. The current owner shouldn’t sell the vehicle until the lien is released and likewise the new owner and lien holder shouldn’t buy the vehicle with a title that has a lien.
Steps to Follow
- Search the address of the failed lien holder to retrieve the name of the current bank. Contact them and see if they can give you the current lien release.
- Using the name of the bank on the title for the failed lien holder, go to the Secretary of State or Banking Commissioner to inquire what organization bought out the bank in question. If the lien is really old, often times the bank can’t find any record of the loan. In most cases, the successor bank will issue a non-interest letter, but they are not required to do so.
- If the first two steps don’t work, and if it’s an old lien, then there is a set number of years depending on the state that the DMV will no longer require a lien release. The seller can then apply for a duplicate title and a new title will be issued without a lien.
This is a very important matter because the sale could not happen until this issue is resolved.
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