When one of your customers pays off their vehicle loan, it’s time for an updated replacement title to be sent to your customer. Thankfully, Consolidated Automotive Services of Indiana has decades of experience navigating the vehicle title process and working with the Department of Motor Vehicles (DMV) across all 50 states. Let’s break down this often cumbersome process to see how our team of experts can make it easier for you.

Lien Releases & Replacement Title Processing

New Replacement Title

When a customer pays off their car loan, the title must be replaced to reflect the customer as the new owner. This process depends entirely on whether your customer lives in a non-holding state or a holding state. In either state, your finance department will work with the DMV to have a new replacement title sent to the customer.

Process for Non-Holding States

In non-holding states, the borrower is listed on the car title as the primary owner. Most borrowers in these states were given the car title when they financed their vehicle, so they only need an official lien release from the lender. With the title and lien release, the customer applies for a newly-updated title at their state’s DMV office.

Process for Title-Holding States

Lienholders in title-holding states keep or hold the title until the vehicle loan is paid off. They are listed as the primary owner, not the customer who financed the car. Once that final payment is made, the lienholder processes a new replacement title and sends it to the customer. This is completed in one of two ways:

  • Electronic Lien and Title System (ELT): A lien release is sent electronically to the state’s DMV, and the DMV sends the updated title to the vehicle owner.
  • Manual notification: The lienholder sends a notification of the lien release to the car owner or DMV by mail. The owner contacts the DMV for a replacement title, or the DMV automatically sends a new title to the owner.

Request a Quote Today 

Consolidated Automotive handles this complex process from start to finish for many auto finance companies and banks. We have in-depth knowledge regarding lien releases, holding and non-holding states, and each state’s process for replacement titles. Request a quote or call us at (812) 988-8300. We also offer lien search and placement services, title transfers, heavy-duty truck title services, repossession title services, UCC filings, and more.

Source: “How Long Does it Take to Get the Title After Paying Off a Car?” Web article. Progressive. Progressive Casualty Insurance Company. Web. 22 Jun. 2023.