A bonded title, also known as a "Certificate of Title Surety", is a document that proves a person’s ownership of a motor vehicle. It can be used in place of a standard vehicle title in order to register a car with the Department of Motor Vehicles (DMV), buy insurance for the car, or sell the car.
In most states, bonded titles can be issued for various types of vehicles like cars, buses, trucks, motorcycles and even some RVs.
A bonded title can usually be obtained by filing with the DMV. While the law might vary from state to state, the main requirements for obtaining a bonded title usually include the following:
- Making a diligent effort to acquire the original car title and any supporting documents by contacting the prior owners or relevant authorities using certified mail. Keep receipts of the certified mail sent.
- Obtain the relevant forms from your local DMV. In California, a Statement of Facts (Form REG 256) is required if the vehicle you want a bonded title for is valued at or less than $4,999. Another form (Form REG 5057) is required if the vehicle is valued at $5,000 or more.
- The vehicle must have been purchased or received as a gift. You usually cannot file for a bonded title if the vehicle in question was abandoned.
- Some states might require that you pay certain taxes before you are issued a bonded title.
It should be noted that a bonded title does not absolutely guarantee ownership of the vehicle and can be disputed. In most cases, a bonded title is considered to be a "provisional" document, and can sometimes be challenged for some time after the certificate has been issued. In many states, a bonded title can be challenged up till three years after its original issue date.
A bonded title can be used for many purposes, including:
- Determining the ownership of a vehicle for legal purposes (ex. used car scams)
- Preventing liability for misrepresentation when selling a vehicle
- Allowing the vehicle’s owner to buy insurance or register the car with the DMV
A bonded title can be very helpful if you are involved in certain legal disputes as it can clarify who is the proper owner of a vehicle. If you need help researching the laws in your area regarding bonded titles and other types of vehicle certificates, you should contact a products and services attorney. Your attorney can also provide you with legal representation if there is a dispute concerning the bonded title.