Car Title - Lienholder

[2002 Maxima SE]

We just paid off my wife's car! When we received the title, my wife and I are listed as the owners and the lienholder (bank) is signed off and stamped showing paid (no lien). Now the question:

The title came with a letter saying we can take the title to the DMV to receive a clean title with no lien. I do not recall doing this with any title I have received after paying off the loan. What is the advantage/disadvantage of keeping the title I have with signed/stamped lien?

 

[mk378]

I think that almost every state clears liens electronically. The lender has already notified the DMV that the car is paid off. This means should you sell the car, the buyer automatically gets a title with no lien showing. There is no need for you to obtain a duplicate paper title.

 

[OneEyeJack]

It gets you a clean title. Just do it now to avoid a clerical or administrative error in the future. Or if you trust department of motor vehicles and bank to no make any errors or mistakes then do nothing.

If I was buying your used vehicle I'd rather see a clean title.

 

[Wheel]

If you get it changed at DMV, it costs you whatever the title fee is (20 bucks here in NY). I had my last car 15 years, and didn't update the title, and my buyer was fine with purchasing it with the payoff letter, and the title not being updated.

Downside to not changing it ? Some people won't buy without a clean title. Some insurance companies won't let you change the 'loss payee' section without the title updated, some only need the payoff letter. If you don't change that, it can be a pain in the event the car is totalled.

I'd check with insurance, and if they're cool with that to remove the loss payee, I'd wait on a new title, and keep the letter with the title you have.

-Congrat's on the payoff too !

 

[Wheel]

NY doesn't auto-update titles. They like their fees. I'm so out of here when I retire...

 

[KingCake]

Originally Posted By: 2002 Maxima SE
We just paid off my wife's car! When we received the title, my wife and I are listed as the owners and the lienholder (bank) is signed off and stamped showing paid (no lien). Now the question:

The title came with a letter saying we can take the title to the DMV to receive a clean title with no lien. I do not recall doing this with any title I have received after paying off the loan. What is the advantage/disadvantage of keeping the title I have with signed/stamped lien?


As long as they released it you do not need a new copy of the title and you will not have a problem selling the car.

 

[opus1]

I paid off my Cobalt and received the payoff letter from the lender. Went to my local Secretary of State office to get an updated title. When the clerk found out what I wanted to do she basically said "you *must* have a better use for $100 than to get a piece of paper that you already have." When I mentioned that I thought we had to do this to release the lien she said that as long as I have the payoff letter from the lender, that's all I needed and to not waste my money.

 

[bigt61]

As stated above, you don't need a new title. Just keep the paperwork/title you have in a safe & secure place until you sell the car. Don't stick it somewhere it might be forgotten. For extra protection, scan it and save it digitally if so inclined so you can show the lien was released "if" you ever need a duplicate from DMV.

 

[Donald]

If it's $5.00 fee, get it done. But states like NY charge excessive fees to give you a new title. So if it's over $5.00 skip it and you will be fine. When people talk of a clear title I am not 100% sure what they mean, but it seems to me a title with paid off lien is a clean title.

 

[cptbarkey]

Texas does not clear leins automatically, you better have a letter from the lien holder to go along with the title transfer.

 

[MNgopher]

If its a cheap fee, like 10 bucks, and you are going there anyways, fine, get a clean title.

If not, keep the payoff paperwork/release, and sell it that way. Never had an issue selling or buying a vehicle with a lien on the title and the release.

Minnesota does not release liens electronically through the state - its all paper.

 

[blupupher]

Originally Posted By: cptbarkey
Texas does not clear leins automatically, you better have a letter from the lien holder to go along with the title transfer.

Did not know that. I guess my credit union pays for it then. Every vehicle I have financed and paid off through them came with a nice new title with nothing on it except my information, no mention of them on it.

 

[2002 Maxima SE]

My title has a signature, stamp and date of release for the lien. I'll save it and the letter in our safe deposit box.

Thanks all for the input!