Posted by Arthur (on Long Island) on Monday, June 13, 2005 at 11:58PM :
In Reply to: O.T. Truck buying question posted by Tim Holloway on Monday, June 13, 2005 at 11:37PM :
Your wife is mostly correct. The buyer cannot register a vehicle with an encumbered title.
You must pay off the lienholder (credit union, in this case) and have them issue a document that indicates that the lien has been satisfied. It's called, variously, a "Satisfaction letter".
This payoff money can come from the buyer, or some other source. If the buyer agrees to this method, he can go with you to the credit union office.
The buyer then takes (1) your original title with the lien info on it, (2) the satisfaction letter, and (3)a bill of sale, to the state DMV. They will allow the buyer to register the vehicle, and a new, unencumbered title will be issued to the new owner by mail in a few weeks.
It's similar to a house closing. It's done this way all the time. By signing over the title to the buyer first, the buyer has a degree of protection.
The credit union can be notified that the transaction will take place at a certain time, and the money can be sent via a wire transfer, and the satisfaction letter can be faxed back to you, if the CU is too far away to go there in person.
apb