When to expect your title after paying off an auto loan

You’ve made your final vehicle payment – congratulations! That is an exciting step as a vehicle owner, and one you should be proud of.

Now, you may be wondering when you’ll receive your title. Great question! Let’s take a look at the journey your title is about to take on its way to you.

Ensure your information is updated

Have you moved or otherwise updated your mailing address since you purchased your vehicle? If so, did you update your address with both your lender and your state vehicle titling agency (Department/Bureau of Motor Vehicles [DMV/BMV], title and registration office, etc.)?

Now may be a good time to double check that your mailing address is correct with both your lender and your state titling agency. Why both? Because there are many types of titles and not all are mailed directly from your lender.

Where your title is mailed from depends upon the state in which your vehicle is titled and the type of title that was issued at the time you purchased your vehicle. Some titles are sent to you directly from your state’s auto titling agency (more about that a bit later), so it’s important to keep them up to date on your current mailing address as well.

Title release dates vary per state requirements

Depending on how you made your final payment, it may take a few days for it to post to your account, especially if you mailed your final payment. Don’t forget to allow time for the check to reach your lender and get posted to your account.

Once your account reaches a zero balance, your title will be set for release. Please note – the account must reach a zero balance for the title release to be processed. If there is an amount due of any kind, it won’t prompt the title release process to begin.

The date your title is set for release depends on guidelines set by the state in which your vehicle is titled. Keep in mind that this MAY not be the state in which you reside, but rather the state in which you originally purchased your vehicle. For example, if you currently live in Texas, but you lived in California when you purchased your vehicle, you likely still have a California title. The title will be released per California guidelines.

Something else to keep in mind is that unsecured forms of payment, such as personal checks, may have additional hold times before a title is set for release. This allows for funds to clear prior to the lien being removed from the title. Again, this follows guidelines set forth by the state in which your vehicle is titled.

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What to expect when your title is processed

When you receive your original title from your lender, it will have the lien signed off in the appropriate area. In states where the vehicle owner holds the title, you will receive a lien release. Simply attach the lien release to the title you currently have in your possession. And, for Maryland residents, where there is a two-part title, you will receive the lender’s portion of your title, with the lien released in the appropriate area.

It is strongly recommended that, upon receipt, you take the original title document(s) to your local state’s auto titling office to have a new title issued in your name with no lien holder. If you do not do so and later misplace the original title and/or lien release, you will need to contact your original lender for assistance in getting a new title. You will have to do so before you can sell or trade your vehicle.

Earlier we mentioned that some states will mail your title to you directly from their vehicle titling agency. In these states, lenders hold an electronic lien and do not have a paper record. When a loan is paid in full, the lender notifies the state agency that they no longer have an interest in the vehicle. At that time, the state removes the lender from the title record.

Some states that process electronic liens print a paper record at this time and mail it to the vehicle owner address on record. (In general, allow up to three weeks for processing and mailing from the state agency.) Other states keep the title as an electronic record until a paper record is requested. If your state processes electronic liens and you have not yet received your title, contact your state’s auto titling agency to see if this is the case.

Let’s talk trade

Did you trade your vehicle, versus paying it off? If so, congratulations on your new vehicle!

You may be wondering what happens with the payoff and title in this instance. No problem. We have you covered. Check out What happens when you trade in your vehicle for more information on what to expect from when you trade your vehicle.

Keep your title in a secure place

Finally, once your title arrives, be sure to keep it in a safe place. Ideally, a fireproof safe or cabinet, where you keep other important documents is best. If you don’t have access to a fireproof safe or cabinet, keep it in a secure, accessible area. Do not keep your title in your vehicle.

You will need it when you decide to sell or trade your vehicle. Knowing where it is and being able to access it when you need it will be important when the time comes.

For more information about this and other topics, including helpful articles regarding financial wellness, please visit our Learning Center.

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