A car title can be signed but never transferred, meaning that the seller did not transfer ownership or register the car in their name. This also points to the previous owner of the car, such that the previous owner did not confirm whether the new owner (your seller) put the car in their name. A vehicle title that is not transferred results in an open title. An open title is a title where the seller does not sign put their name, meaning it is not transferred to them to possess the liability legally.
An open title results from various factors, including an unlicensed private seller who flips more than the state-permitted number of cars yearly. Also, the buyer, typically the unlicensed car flipper, also called a curbstoner, wants to avoid registration charges and sales tax so that the state is unaware that they are violating the law of exceeding the number of cars than permitted for private sellers.
In cases where a buyer possessing a title loses it, the title is temporarily open. However, it can be fixed by requesting a duplicate title. The seller or the person whose name is on the title is responsible for requesting a duplicate title and signing it over to the buyer to put in their name.
Car title signed but never transferred
In some situations, car buyers fail to register their cars with the Department of Motor Vehicles (DMV) after acquiring them. Fortunately, whatever the situation that resulted in your car title signed but never transferred, there are a few ways to rectify the situation. This involves completing a bill of sale, being aware of any applicable local or state legislation, and so forth. So, car title signed but never transferred, below is the fix:
-
Check your state’s DMW requirements for transferring ownership of a vehicle
Most state DMVs will let transfers be completed even if they are made after the deadline. Depending on your state agency, this might be a $10–$20 (or more) late charge. Bear in mind that this procedure normally only works for a limited period.
If you signed over your car title more than 6 months ago, your state’s DMV may not approve the title transfer.
Before attempting any title recovery option, check with your state DMV to determine whether your documentation is still regarded as legitimate.
-
Contact the person you sold the car to and request that they complete the transfer of ownership process
If you discover that a car title was signed but never transferred before your purchase, you should always attempt to contact the person who sold you the car. You will occasionally succeed, and a tiny error may be fixed.
But if you are the victim of a car flipper, the contact information they have provided you with may be incorrect. You’ll have a difficult time finding them in such a situation.
You might try to contact the vehicle’s original owner using the original title to follow and prove ownership history and get a duplicate title. If this fails, you will have to consider alternative options.
-
Consider sending them a certified letter
If the person is unresponsive or unwilling to transfer ownership, send a certified letter demanding the transfer of ownership.
A certified letter is an extra service offered by USPS that provides you with the verification that a package or mail piece has been delivered.
-
Contact your state’s DMV
If there is still no response, contact your state’s DMW and explain the situation to see what options are available to you
They are likely to provide you with different options such as getting a surety bond, bonded title, or a court-ordered title. To get a surety bond, you must show proof that you own the car. Most likely, you will also need a state inspection to show that the car wasn’t stolen. This is when meticulous record-keeping and a bill of sale come in handy.
You will get a bonded title after purchasing a surety bond. This is akin to a salvage title, which indicates that there is a problem with the title. Depending on your state, a bonded title can normally be cleared after three to five years if no one else claims the car.
State rules regarding bonded titles differ. States such as Texas, Florida, and California recognize surety bonds, although Virginia, Kentucky, South Carolina, Oregon, South Carolina, Kansas, Delaware, New Jersey, and a few other states do not.
Court-ordered titles, which are unlike surety bonds, are recognized in a few states, including Ohio, Georgia, and Indiana. A court-ordered title is comparable to a surety bond in that it is settled in court rather than purchased after proof of ownership is submitted to the DMV of a state.
-
Purchase insurance coverage
If the car is still in your possession, make sure it is properly insured and registered under your name until ownership is transferred to avoid any legal issues.
You may have difficulty getting insurance for the car since you can’t fully prove ownership due to the car title signed but never transferred.
In this situation, it is generally a good idea to have a notarized bill of sale.
A notarized bill of sale is a legal document that contains information such as the seller’s name and contact information, the buyer’s name, make, model, date of sale, odometer reading at the time of sale, sales price, and VIN of the car being sold. You can use this in the future to aid in acquiring a new title if the car title is lost or if title hopping happens.
-
Consider taking legal action
Many people’s first reaction to fraudulent conduct is to file a lawsuit against the person or corporation committing the scam. This is significantly easier to accomplish when dealing with shady vehicle sellers. This can be far more difficult or impossible with private vendors, especially those who provide bogus contact information.
Sadly, bringing a lawsuit is often one of the least effective ways to deal with open title problems, unless you are dealing with a large, well-known company.
A car title can be signed but never transferred to the name of the seller, meaning you can’t put it in your name since it is an open title. Normally, you and the seller are not supposed to sign the title since it carries the name of an absent registered owner – the previous seller.
-
Get a bonded title, surety bond, or a court ordered title
Buying a surety bond can be one of the better ways to fix an open title problem, even though it can be a pain. To get a surety bond, you will need to show proof of ownership. Most likely, this will include a state inspection of the vehicle to show that it hasn’t been stolen. This is why it’s important to keep good records and get a bill of sale.
K
When you buy a surety bond, you will get a title that says “bonded.” This is like a salvage title, which means that there is a problem with the title. Depending on the state you live in, you can usually clear a bonded title after three to five years if no one else claims the vehicle.
M
When it comes to bonded titles, state laws vary. Texas, Florida, and California allow bonded titles, but Virginia, Kentucky, South Carolina, Oregon, South Carolina, Kansas, Delaware, New Jersey, and a few other states don’t recognize surety bonds.
Some states, like Ohio, Georgia, and Indiana, accept titles instead of surety bonds. A court-ordered title is like a surety bond that is settled in court instead of being bought from the DMV after proof of ownership has been shown.
Can a Seller Sign a Jumped Title?
Unless the previous seller signs over the car title, the buyer can’t register it in their name, meaning that the buyer gets an open title to deal with. The best practice is for the seller to have transferred the car in their name, but they deliberately refused so that they can get rid of the car for profit. The previous owner has little to no control over the seller putting the car in their name, though. Most of the time, the transaction keeps the previous owner liable for the car.
Now, whatever violation the ‘now unregistered car does, the previous owner is notified, making them liable. This action brings up the question, “How to prove that I sold my car?” Fortunately, the previous owner can prove that they sold the car by presenting copies of their title, bill of sale, and photo ID. The bill of sale and title would contain additional information such as VIN, which gives details of the vehicle and the bill of sale would contain the buyer’s (your seller’s) contact information. Since the seller is an illegal flipper, a curbstoner, he may have provided the wrong contact details, so he can’t be reached.
Read also: proving when someone keyed your car
Also, the previous owner’s insurance can assist to protect their client from being liable for car damages or damages associated with the car.
Typically, an open title is a jumped title, meaning the seller’s name is not on the title. And as mentioned earlier, mostly unlicensed flippers or private sellers exceeding the number of car sales in their state practice this to make a profit.
It works 99% of the time, but the 1% can go wrong! The DMV can refuse to register the car in the name of the buyer because of wrong signatures or signatures in the wrong place. The buyer must now contact the previous owner of the car (the owner before the seller) to get a new title. If the previous owner refuses or is deceased, you now possess a vehicle you can’t put in your name.
How do open title cars come to be? A car flipper goes on Craigslist and buys an open title car from Mr. B for $700. He details the car and lists it for $1,500. Mr. C buys the car from Mr. B who now jumps the title because they’ve not put their name on it.
What happens when a buyer does not transfer a title in their name
When a seller buys a car and sells it to another person without registering it in their name, it is known as title jumping. The jumped title is known as an open title because it does not contain the signature of the recent buyer, your seller perhaps.
As mentioned earlier, the seller is an unlicensed flipper whose concern is to maximize profit by avoiding registration charges and sales tax. By avoiding registration charges and sales tax, the car flipper jumps/skips the title, which affects the person they’d be selling the vehicle.
Now, the buyer of the car from the unlicensed private seller or flipper, also a curbstoner, is left with a car that they can’t register. Why can’t they register the car? The reason is that the flipping seller did not put the car in their name, so can’t sign over the car to them.
Why did the flipping seller not register the car in their name? The answers are (1) to exceed the state-mandated selling limit; (2) to avoid sales tax; (3) avoid registration charges.
When new buyer finds their way out, they would have to pay a fine because the previous seller exceeded the state-specified days for registering a car after buying it.
The new buyer’s best option is to contact the previous owner whose name is on the title and get them to request a new title and sign it over.
How a jumped title affects the new owner of a car
A jumped title means the seller a new buyer is buying a car from did not register it in their name to avoid sales tax and registration, and sold more cars than a private seller should in a year.
The best practice is for the new owner to ensure that the name of the seller on the title is the seller. Otherwise, it may be challenging to contact the original owner whose name is previously on the title. However, if a seller’s name is not on the title, but they have the power of attorney to sign over the car to you, they can sign it over to you. You will have to verify that the power of attorney is valid before completing the deal.
The problem with possessing a jumped title is that it is difficult to put it in your name. Moreover, you possess a car you can’t register because the person you bought it from is not the name on the title.
Nonetheless, you can register the car in your name legally, but it’s a stressful procedure you may not be ready to undertake. Typically, a seller or a curbstoner lies that they lost their title, and so they’re selling the car without a title. Ask them to request a duplicate title before you can pay for the car.
What to do if your signed car title was not transferred
If your title was signed and never transferred, you can resolve it legally. Let’s assume that you bought the used car from a dealership, you can file a fraud claim against the business and get your money back or request a refund.
However, if you bought the car from a private seller, typically a flipper, get in touch with them to register the car in their name and sign it over to you. Depending on how long it is from the date the seller bought the car, they will pay a fine. Also, the private seller may be unwilling to sign over the title since they may have exceeded the total number of cars they can sell for the year.
If you can’t contact the seller, you need a bonded title or a court-ordered title. You may need a release of interest from the previous owner on the title, but if you can’t contact the previous owner, you can proceed with buying the bond.
Can you get a bonded title in your state?
Unfortunately, not all states recognize title surety bonds. Below are the states that do not allow bonded titles:
- Delaware,
- District of Columbia
- Kansas
- Kentucky
- Louisiana
- Maryland
- New Jersey
- North Dakota
- Oklahoma
- Oregon
- Pennsylvania
- South Carolina
- South Dakota
- Virginia
- West Virginia.
Several other states allow bonded titles; just refer to your state laws on check your local DMV’s website.
Below are the states that accept bonded titles:
- California
- Colorado
- Florida
- Texas
Meanwhile, Indiana and Ohio do not accept bonded titles but they issue court-ordered titles. Refer to our article explaining a court ordered title.
How to get a bonded title
To get a bonded title, also known as a certificate of a title surety bond or title bond, refer to your local DMV. First, you must be eligible, and it’s your DMV that determines your eligibility.
Generally, to be eligible for a surety bond application, you must prove that you bought the car legally. You can prove ownership with the bill of sale and title; you will be certified. Secondly, your state may require a theft inspection. The assessment may be done by your local sheriff, and you’d be certified. Thirdly (not applicable in all states), the car must pass the emissions test, of which you will be certified.
Now, use the paperwork to buy a surety bond from a surety company. A surety bond is a promise that you will be responsible/liable for the debt of the vehicle. The cost of a surety bond depends on the bond amount, typically 1-15 percent. If you’re buying a $10,000 bond policy, you may be paying between $100 and $1,500 depending on the bond policy.
The surety company will mail you the bond, which you submit to your local DMV to complete the bond application process, making you the legal owner of the car.
As mentioned earlier, if someone appears to file and win a claim against your bond, you’re responsible for the surety cost the company uncovers in the claim against you. Just ensure the car was not stolen before.
