How Do I Sell My Car With a Lien on the Title?

Provide proof of lien removal when selling your car.

Selling a car with a lien on the title is not uncommon. It simply means that the loans on the car have not officially been paid off. The title cannot be transferred to the new owner, however, until the seller provides proof that the lien has been released. This can be done a few ways.

Things You'll Need

• Proof of lien removal
• Title
• Bill of sale

Instructions

1. Pay off the loan. Once the loan is paid in full, the lien will be removed. You will receive the car title and may proceed with transferring the title to the new owner

2. Transfer the existing loan to a new loan. If you cannot afford to pay your loan off in full, you can tag the old loan balance to a new loan. Once the old loan has been paid off, the lien has been released and you can proceed with transferring the title.

3. Provide proof to the buyer that the lien has been released. Proof can be provided in two forms. The lienholder can send a Notice of Recorded Lien, which must be signed by an authorized offer and indicate that the lien has been satisfied. Or the lienholder can prepare a letter on official letterhead indicating that the lien has been satisfied. If the lienholder is not a loan company, the letter must be notarized.

4. Complete the title transfer. The title transfer is complete after the buyer and seller have signed and dated the back of the title. Normally, a bill of sale is also required and should include purchase price, year, make, model and VIN number of the vehicle.

5. Once you've transferred the title, surrender or transfer your license plate at the DMV. Also, it's important to immediately un-register your old vehicle so that you are not liable for any damages that may occur under the vehicle's new ownership.

References

• NYS DMV

Resources

• NYS DMV