What is a Car Title?
  • Buying Guides

What is a Car Title?

By Autolist Staff | April 29, 2019

Your vehicle title is a legal document that proves that you're the true owner of your car. It also provides details about the history of the vehicle. A vehicle title may also be known as a certificate of title or a pink slip. If you plan on buying, selling, or registering a vehicle, it's essential that you understand the ins and outs of car titles. Read on for detailed information on car titles so you can be confident in whatever your next step may be.

Title Information

The information on your title varies depending on where you live. The following information is typically found on a state title:

Vehicle identification number: The vehicle identification number, or VIN, is a number that identifies the vehicle. If you're considering purchasing a new vehicle, it's essential that you check the VIN on the title to make sure that it matches the VIN on the car. The VIN can usually be found either on the driver's side of the car's dashboard near the windshield. If you don't see it there, check the bottom of the driver's side door pillar with the door open.

Odometer reading: The title should also show what the car's mileage was at the time when the owner applied for the title. If the mileage says "Not Actual," that means that the odometer disclosure may not be accurate. While it could be an honest mistake that occurred at some point along the vehicle's paper trail, you should be cautious, as the odometer may have been rolled back.

Owner information: The car title should clearly state the name(s) and address(es) of the current owner and any other owners from the past. If you're going to become the new owner of the car, be sure to verify that information first, so you know you're buying the vehicle from the true legal owner.

Vehicle details: At very least, the title will state the car's make, model, and model year. It may also have other information such as the style of vehicle, the number of the license plates, the car's weight class, and how it runs (gas, diesel, electric, or hybrid).

Lender details: If the previous owner used financing to buy the car, the lender's name and address would be listed on the title. Until the loan is repaid, the lender is the legal owner of the vehicle. A lien release occurs after the lender has been paid.

Types of Car Titles

Not all titles are the same. As long as the vehicle hasn't had any significant issues, you should receive a standard title known as a clean title. However, if the car has been damaged in some way (even if the damage has been repaired), it may have one of these titles:

Lemon law title: Some states have lemon laws" that protect the buyer in case the vehicle turns out to be defective and can't be fixed within a certain amount of time after a certain amount of tries. If the car does turn out to be a lemon, the original seller will repurchase it. These buyback lemons can be resold, but the title must state that they were bought back because of past problems. Always be extremely cautious when buying a car with a lemon law title.

Salvage title: Cars that have been in major accidents that cause significant damage will have a salvage title. The salvage title means that the car can't be driven as it is, so it will need to be repaired or used for parts. Like lemon law titles, you should never buy a car with a salvage title unless you're confident that it's a smart decision. When it comes to shopping for used vehicles, deals that seem too good to be true usually come with a catch.

Rebuilt title: A car with a salvage title that has been repaired gets a rebuilt title. In other words, the vehicle used to be severely damaged, but now it's in driving condition. A rebuilt title doesn't necessarily mean that it's roadworthy, so be sure to have the vehicle thoroughly inspected by a trusted mechanic before you considering buying it.

Flood title: A car with a flood title has gone through water damage. While that may not seem like a big deal, a car with a flood title has sat in water that's deep enough to fill the engine compartment. Unfortunately, some vehicles that have had flood damage may be cleaned, "repaired," and sold in a different state. That's why it's crucial that you check the vehicle's Carfax history before considering a transfer of ownership.
Transferring Ownership of a Vehicle

Now that you understand the information on a car title and the different types of car titles you may see, you may be wondering how titles factor into the buying or selling of a used vehicle. Fortunately, it's a reasonably straightforward process. Here's how to transfer the ownership of a vehicle:

First, check the back of the title. You'll see the Title Assignment sections. The seller completes one, and the buyer completes the other. The instructions state the information that you'll need to include, which includes names addresses, and car details.

Although filling out this information is easy, it's incredibly vital that you're extremely careful. If you make an error, you can't undo it. You'll have to provide a bill of sale and notarized documents to obtain a duplicate title, which is an easily avoidable pain that neither of you will want to deal with. One of the most common errors is that the buyer or seller will put their information in the wrong section, so triple-check where you're writing.

Finally, it's vital that the seller keeps a photocopy of the car title for at least 18 months. That protects them if the new owner has a legal problem related to the car. For example, say the new owner never re-registered the vehicle and then crashed into a building. Now, because the vehicle is still technically in your name (even though you sold it), you're legally obligated to pay for the damage caused by "your" vehicle.

If this type of nightmare situation occurs and you don't have a copy of the title, a lawyer should be able to help you. However, nobody wants to deal with that kind of headache. Your copy of the transferred title protects you and makes it easy to clear up the situation.

Obtaining a New Title

It's important that you keep your car title in a safe location. However, sometimes accidents happen, and the title may become lost or destroyed. Fortunately, there are steps you can take to get a duplicate title. The process varies depending on where you live, but usually, you'll need to go to the department of motor vehicles with your driver's license, fill out and show the required paperwork, and pay a title fee.

Shop Smart

If you're shopping for a used or new car with a clean title, Autolist can help. Autolist curates the largest selection of vehicle listings with detailed information and history readily available. With over 24,000,000 listings and counting, you should have no problem finding the vehicle of your dreams at a price that fits your budget. Now that you have a better understanding of car titles, you can use this information to shop smart with absolute confidence. Browse Autolist today, and get the best deal on the perfect vehicle.