How to Get a Title When the Car Dealership Goes Out of Business

  • 4 min read

What happens when you bought a car without a title from a dealership that has gone out of business? Unfortunately, this happens much more often than you may think. Oftentimes when a dealership is getting ready to go out of business or having financial troubles, they’ll sell vehicles that they don’t have the title for or can’t obtain the title for without paying off a lien first. This way they avoid paying additional fees for registration and/or liens since they’re going out of business anyway. So where does that leave the new owner? The dealership is hoping that this will now be their problem, but there are still ways to get your car title from a closed dealership.

Here’s what they don’t want you to know, all dealerships that sell vehicles are required to be licensed by the state agency where they are domiciled. If you bought a car from a dealer, they’re legally obligated to follow through with the title transfer process according to their license. Even after they close their doors, the dealership will have a registered agent that is designated to represent the dealership. Contact the registered agent and request that they assist you with getting your title. If you bought a car from a dealer and they refuse to give you a title because they’re closed or for any other reason, report the dealership to your local licensing division of motor vehicles or the DMV.

State-specific processes to get a vehicle title from a closed dealership

States like New Jersey have a specific process that addresses how to get a car title from a dealership if they’re out of business. If you bought a car without a title from a dealership in New Jersey that went out of business prior to issuing your car title, you can apply to acquire a title from the New Jersey Motor Vehicle Commission (NJMVC). This is a 14-step process that allows for emergency application for vehicle title in the event that your dealership has gone out of business prior to issuing your: title, plates, and/or registration. Each state handles this process differently, be sure to check your state’s requirements before proceeding with any official application.

Other states, like Indiana, have a different process that requires you to directly make contact with the dealership by sending a demand letter for your car title. If your state requires you to contact the dealership with a demand letter, the first step is to look up the business in your state’s Secretary of State database. Next, search the database for the principal name, registered agent, and address. Then, write your demand letter clearly stating what you need from the dealership and send it by certified mail to the principal, registered agent, and any additional officers listed. Before sending any letters, it’s important to review your state’s requirements to ensure all of the criteria are met and that the correct parties will receive your letter. Sending your letter to multiple contacts within the company increases the likelihood that you will receive a response and provides proof that you attempted to make contact.

Buying a car is one of the most exciting purchases you can make, but it can quickly become unpleasant if you’re purchasing from a bad dealership The best way to prevent yourself from buying a car with no title and avoid being scammed by the dealership is to ask for the dealership to show you the physical title prior to purchasing. While they may not be able to hand over the title to you at that time, they can show you that they physically have it. If they’re a reputable dealership, they’ll show you the title. If you’ve already bought a car without a title, there are still ways to get the title you deserve.

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