When And Why The Dealer Will Not Provide The Title – They Don’t Have It.
Watch the Video Below: When and why the dealer will not provide the title. Especially during COVID from 2020 into 20201, there has been an increase in dealers selling cars that they do not possess the title to. In the video below, Maryland dealer fraud attorney Daniel Whitney, Jr. discusses the issue of dealers that sell a car without the title and dealers not providing the title after the sale. It is an open secret in the car industry that this happens all the time.
In addition to calling us, when you have title problems with the dealer, you may also want to file an MVA Complaint – we can help with that if we take your case.
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When a dealer does not provide the title to a car, common searches that buyers do for information are: Can I Sue A Dealership For Not Giving Me A Title, How Long Does A Car Dealership Have To Give You The Title, Dealer Hasn’t Sent Title, Can A Dealership Sell A Car Without A Title, Haven’t Received Title From Dealership, and I Bought Car Owner Won’t Give Title.
In response to those concerns, the information below and in the video should help regarding purchases in Maryland. In short, yes, buyers can sue a dealership for not giving the title. The lawyers for car dealer problems at Whitney, LLP have successfully sued many dealers for not providing a title.
Why Dealers Are Selling Cars Without the Title
While some registration delays are due to COVID, some dealers are using COVID as an excuse because they do not have clear title to the car they sold. The real reasons that dealers often are not providing the title to buyers or to the MVA to get the car registered are because:
The dealer did not get the title from the person who traded the car in as part of the dealer for another one. This happens often when a person trading the car in does not have their title or cannot find it. Instead of waiting for paperwork to be processed to obtain a duplicate title, the dealer turns around and sells it to a buyer without having the title. This is wrong and causes problems for the new buyers because without the title, the car will not be registered.
The dealer did not pay the lien / loan off on the car after it was traded in. Dishonest dealers will buy a trade-in from a customer, and not pay the loan off before selling it to the next buyer. This usually happens when dealers are having cash flow problems. Or, the dealer simply wants to sell the car as fast as possible and has not sent the check to the bank that has the loan fast enough. This is also wrong and causes a problem because the lien on the title needs to get paid off before the new buyer can register the car in their name.
Maryland Law On Dealers Having Titles
Maryland has strict rules that dealers must follow when it comes to obtaining the title of a car they intend to sell. No matter the car was a new one for resale, a trade-in or one that they buy at auction, dealers must follow the law.
Maryland law on dealers providing titling can be read here: Md. Code Ann., Transp., § 13-113.
Here is a brief summary:
- Maryland dealers must obtain within 20 days the certificate of title of a vehicle they purchase for resale, which shall contain an assignment and warranty of title executed by the former owner.
- Once they sell a vehicle, they must execute an assignment and warranty of title on the certificate of title to the transferee, and submit that, along with the application for the certificate of title and other necessary documents, and all taxes and fees, to the MVA within 30 days.
- If the vehicle is to be titled out of state, the dealer has 30 days from delivery to provide the title to the buyer.
How Long Does a Car Dealership Have to Give You the Title
In Maryland, a car dealership has 30 days after delivery to send the title where it needs to go.
If the car is being registered in Maryland, the dealer has 30 days to send the title, along with the other required documentation to register the car, to the MVA.
If the car is being registered out of state, the dealer has 30 days to provide the title to the buyer, unless the buyer agrees otherwise with the dealer.
Maryland Has a Warranty of Implied Title
Maryland protects consumers with a warranty of title with a warranty of title under Md. Code Ann., Com. Law §2-312, et seq. The principal function of the warranty of title is to give legal effect to a buyer’s reasonable expectations that they are purchasing property with a good, clean title.
What a “Warranty of Title” means in a situation involving a car dealer selling a car and needing to provide a title is that when the dealer sells the car, it is part of the deal, even if the question itself is not asked, that title to the car is being conveyed without any lien or other problems. In other words, that the buyers get a “clean” or “clear” title is implied to be part of the deal for the car. And of course it is – otherwise, no buyer would buy a car if a clear title did not come with it.
The Dealer Will Not Send the Title
Transcript of the Video below, with edits for the blog.
Hi. This is Dan Whitney with the Whitney Law Firm here in Towson, Maryland. Today, we’re going to talk about why car dealers sell cars that they don’t have the title to. So I’m an attorney. I’ve been an attorney by 10 years. I handle a lot of cases involving car dealerships, car dealership fraud, failure to disclose and the whole host of schemes that car dealers force upon their unsuspecting customers. But particularly in the COVID era, what I’ve seen a large increase of is car dealers that sell cars to customers that they don’t actually own yet and they don’t have the title to.
Dealers Have 20 Days to Get the Title From a Trade In or Auction Car
Now in Maryland, car dealers are required to obtain a title to a car that they acquire for resale. They have to get it within 20 days, and then they have to keep that title on the property of the address that is licensed to have the dealership. And of course, some of them don’t do that. There’s all sorts of floor plan financing arrangements, where perhaps the auction house will hold the title until the car dealer pays it off. Although that’s a problem because the title is not where it needs to be at the dealership, but the dealers don’t care.
Dealer Sold the Trade In Without Getting the Title
So what has been happening is dealers will get a car traded… Let’s just talk about trade-ins. The dealers get a car that’s traded in. Somebody trades in a car and buys another one. Now, they’ve got this car sitting here. Let’s say they didn’t get the title because many consumers that trade a car in don’t have the title on them. Maybe they can’t find it back at their house, but the car dealership does not want to postpone the sale until the consumer can find the title because they may never find it, and then there’s not going to be a sale.
So they just do the deal, sign the paperwork and say, “We’ll figure it out later,.” What they’ll do, the dishonest ones, they’ll take that same car, we’ve got another customer coming along, and they sell it to that customer, but of course they don’t tell them, “It has a lien that’s not been paid off. We don’t have the title.” They don’t say any of that. They’ll say, “Okay. We’re going to charge you about $300 to get it registered and which the customer pays, and then off they go in this car.
No More Temp Tags From the Dealer
The problems come to light after the temp tag expires. The dealership will issue a second temp tag often, but then at some point, the dealership says, “You know what? I’m just not able to issue more temp tags. You got to deal with it.” And that’s when the rubber hits the road and the customer is unable to get their car registered, and now they’re stuck because they don’t want to drive on expired tags, and it seems like they have no options.
And at this point, the dealership is usually ignoring the customer because really there’s no more money to make, so why would they talk to the customer? It doesn’t seem to make sense to them, and it happens a lot. So at this point, the customer is stuck.
You Can Sue the Dealer For Not Giving You the Title
Consumers can file a complaint with the MVA when the dealer will not provide the title. Or of course they can contact an attorney and dealerships often have to pay attention to a lawsuit a lot faster than simply a complaining customer. Lawsuits seem to get their attention much more quickly. We usually just sue them out of the gate. Why fool around?
So the moral of the story is, if you’re going to buy a used car from a dealer, especially in the COVID era where everything gets delayed now, ask the dealer, do they have the title? And if you hear anything other than “Yes. Here it is,” you should think twice about buying the car. So if this does happen you’ve certainly got a significant legal rights.
Whitney, LLP’s Lawyers Deal With Car Dealer Problems With Titles
When the dealer cannot or does not provide a title, you may be able to unwind the transaction. If they’re selling the car that they don’t actually have the title to, or have not paid the lien off before selling it, you may be able to sue for fraud, a violation of the Consumer Protection Act, a violation implied warranty of title, and negligence.