Do You Really Own Your Used Car?

You go to the used car lot, sign a contract, and drive away with a new-to-you vehicle. You own it, right? Wrong. Find out what happens when the dealership doesn’t transfer title to your used car.

Most people assume that they own a car when they sign a contract and pay the down payment. But in Michigan, and many other states, there’s another step that has to happen before ownership really changes hands.

You Don’t Own It Until They Transfer Title

When you buy your car from a used car dealership, the seller is required to “transfer title” to you, by signing the vehicle title and sending it in to the Secretary of State’s office. Unfortunately, many dealers, particularly small used car lots, never provide proper title to their buyers.

Unregistered Vehicles Cause Headaches for Drivers, Not Dealerships

Used car dealers often get their vehicles from trade-ins, private sellers, or auto auctions. But they don’t want to wait the 20 days the auction house has to transfer title or the up to 60 days it can take to get the paperwork back from the Secretary of State’s office. So they sell the car quickly and recover the money, sometimes before they even receive title themselves. And that lines the drivers up for problems, not the dealers. David Dayen of Vice.com explains:

“Across America, used car dealers sell unregistered vehicles to unsuspecting consumers and then never supply them with legit papers. Drivers have been handcuffed, searched, detained, and essentially terrorized for buying a car from the wrong dealer.”

When The Buyer Doesn’t Own the Used Car, Accidents Get Complicated

Vice asked auto accident attorney Dani Liblang of The Liblang Law Firm, P.C., for comment. She said:

"It's a menace to everyone else on the highway as well."

A client of The Liblang Law Firm, P.C., found herself in the middle of just this kind of mess. Mary was rear-ended by a woman who had purchased a used vehicle from a “buy here pay here” lot. The dealership had obtained the vehicle by repossession, but never sent in for a valid title or transferred it to their buyer. By law, the dealership, not the driver, owned the car at the time of the crash.

In Michigan it can be tough to get insurance if you don’t have the title to your used car. So when Mary sought compensation for her injuries, she had to sue the dealership, not the driver. The used car company fought the case all the way to a jury trial in January, 2017. But in the end, Attorney Dani K. Liblang won $68,608.00 for Mary, in addition to interest and court costs.

When used car dealerships cut corners on title transfers it is Michigan motorists who pay the price. Whether through repeated tickets or extended litigation, consumers get held hostage to the dealer’s bad practices. If you find yourself trapped with no title, contact the Liblang Law Firm, P.C., today for a free consultation.