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Car Title Problems

TIP:
To avoid car title problems, complete the sale of the vehicle and title transfer at a state Driver & Vehicle Services location. The DVS agent can review the title and see whether there are any liens on it. The buyer and seller can transfer title on the spot and avoid problems filling in the blanks, signing it, or mailing it to the DVS.

Transfer Car Title at the time of Sale

When a vehicle is sold in Minnesota, the seller should transfer title to the buyer. See MN Driver and Vehicle Services. On the left-hand side of their website, select "Title Info" or "Vehicle Transfers" for more information.

The buyer and seller can transfer title by:

  • filling in the blanks on the certificate of title form with details of the sale,
  • attaching a lien release, if the title shows there is a lien in favor of a bank or lender,
  • signing the certificate, and
  • mailing it to MN Driver and Vehicle Services (DVS) within a certain time-frame. DVS then mails a new car title to the buyer showing buyer is the owner.

However, people often make mistakes in filling out the form and mailing it to the DVS before the deadline. Even if the buyer discovers the problem, often he or she cannot locate the seller to complete the transfer.

Possible problems for the BUYER:

  • The seller may still owe money for the vehicle (called a lien), and the bank or person who is owed money can try to collect it from the buyer, or can try to repossess the vehicle from the buyer.
  • Only the title holder ("owner" on the title) can get insurance on the vehicle, which is required by Minnesota law.
  • If title has not been properly transferred, the buyer will not be able to re-sell the vehicle to someone else in the future.
  • If the seller has a record of drinking and driving and title is still in his name, the vehicle could be impounded and sold by the state.

Possible problems for the SELLER:

  • If the buyer gets in an accident in the vehicle, the seller could be sued as the "owner" of the vehicle. This can be a very expensive and distressing experience.
  • If the vehicle is impounded, the government may require the seller to pay the charges of towing and/or storage of the vehicle.
  • If the buyer does not have a valid driver's license, the vehicle cannot be put in his or her name. This can lead to the problems described above.
NOTE FOR SELLERS:
  • Fill in the "Seller's Notice of Sale" (the tear-off section on the Certificate of Title) and send it to "Driver and Vehicle Services" (DVS) at the MN Dept. of Public Safety. You may also notify DVS online at their website Driver and Vehicle Services (DVS). Go to "Vehicle Services" then click on "Report of Sale." NOTE: Submitting that form does NOT transfer title; it is only a report to DVS that the vehicle has been sold.
  • In Minnesota, license plates belong to and stay with the vehicle. They do not belong to a person.

Transfer Car Title by Court Order

TIP: If the seller was a licensed dealership that has gone out of business, the buyer can contact the DVS Dealer Unit (651)296-2977 for additional information about the dealer.

If the transfer of title cannot completed by filling out the Certificate of Title form, the BUYER may ask for a court order to transfer title. This takes time and effort and costs money, but title can eventually be transferred. Click on the links below to see how to ask the court for an order to transfer title.

If the SELLER wants to force the title transfer, they must do so through the Driver and Vehicle Services office.

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