Should I let the bank hold on to my vehicle title?

[real_cheep]

What is the name of your state? -Georgia

A couple of years back, I refinanced my auto loan, and through some kind of mix-up, the new loan company never got the original title from the old loan company, and I ended up with it. The new loan company thinks it got lost, and they keep sending me applications for a duplicate title that they want me to sign and send back to them. My account has always been in good standing, and I even pay additional principal with each months payment.

My question is, do I have to sign this duplicate title application? I would just as soon keep the title in my own possession. Thanks.

[Zigner]

Originally Posted by real_cheep

My question is, do I have to sign this duplicate title application? I would just as soon keep the title in my own possession. Thanks.

If you don't, they may consider it a breach of the contract and call the loan due immediately...

[Rexlan]

Originally Posted by Zigner

If you don't, they may consider it a breach of the contract and call the loan due immediately...

The more important issue is who is shown as the lien holder? What can happen is if the old load is still shown then you may never get clear title to the vehicle when you pay if off with the new one. If there is not a lien holder on the title I would retain it and pay off the note as agreed. If you sell the vehicle without paying off the note they will have recourse. If the old lender is shown on the title then you do need to get this corrected.

[real_cheep]

There is no lienholder listed on the title. Only my name. I think I will try holding on to it for a while. Thanks for your advice.

[Zigner]

Originally Posted by real_cheep

There is no lienholder listed on the title. Only my name. I think I will try holding on to it for a while. Thanks for your advice.

Ok, but when you come back asking if it's legal for the loan company to demand payment in full over this matter, you're only going to hear "I told you so".

[Rexlan]

Originally Posted by Zigner

Ok, but when you come back asking if it's legal for the loan company to demand payment in full over this matter, you're only going to hear "I told you so".

I'm not disagreeing but I am curious why or how this can be the case?

I fully understand that they want collateral for their loan, that was the basis of their loan, etc.; however, I'm not clear why you must surrender title automatically, especially after the loan has been made unless that was a condition of the loan. It sounds like the bank made a mistake but I don’t think that gives them a preemptive right to make demand if the loan is current.

Thanks

[cvdesign]

Originally Posted by Rexlan

I don’t think that gives them a preemptive right to make demand if the loan is current.

But how does the bank KNOW that you'll always be current? Things happen ... people lose jobs, get crushed under debt ... and car loans, if the forums here are any indication, are sometimes the first obligation that slides ...

Point is, the bank needs to know that it has security in your debt. And it doesn't get that warm, comfy feeling solely from your promises to pay.

[Zigner]

Originally Posted by Rexlan

I'm not disagreeing but I am curious why or how this can be the case?

I can guaran-damn-tee you that it is one of the conditions of the loan.

[Rexlan]

Originally Posted by Zigner

I can guaran-damn-tee you that it is one of the conditions of the loan.

That being the case then we can agree; however that is an assumption so far on our part.

I would also agree that 108% of the time the bank would already have control of the title with them as a lien holder. However, that is not what has been presented so far by the OP. In fact, this issue is 2 years old for OP. I have seen a number of refinance loans from credit unions and such that do not require the vehicle as collateral. We probably don't have enough information. But as I originally said, if OP defaults the load they will have recourse so holding the title does not hide the liability.

My only point is that I don't think they have a right to demand the note for any reason other than default, which the title issue wont' qualify.

cvdesign we are not talking about what if's ... this is specific to this question. Your logic is correct however.

So … now why didn’t I get any help on my thread? It is an interesting question I think.

[Texas Pooh]

The new loan company thinks it got lost, and they keep sending me applications for a duplicate title that they want me to sign and send back to them.

OP is being asked for the collatoral - the loan company wants to get a replacement title to secure the loan.

Zig is right; if OP doesn't comply (and or fess up that he has the title), there is a significant chance that the loan is going to be called.

[debtcollector`]

Originally Posted by Rexlan

So … now why didn’t I get any help on my thread? It is an interesting question I think.

You did get help. You just didn't like the answer given.

DC

[real_cheep]

Thanks for all the additional replies. Now, I'm thinking maybe I should just go ahead and sign and return to the lender one of those title applications (the number I've received is more than I can count on two hands). I will confess, that as this process has evolved, I have at times entertained fantasies (which usually arise around the time I receive from them an application for replacement/duplicate title) about somehow not having to fulfill my obligation to them, by virtue of holding a title without any listed lienholder, but my rational mind always quickly kicks in and reminds me that no lender would ever say goodbye to $20K without a fight, and there are plenty of documents that prove they are indeed the rightful owner of the vehicle. Plus, it's hard to ignore the fact that it would be horribly dishonest.

Anyway I'm glad I finally asked this question and successfully elicited some knowledgeable commentary to help me make the decision that will put this issue to rest. I'm sure the poor bank employee who has been bird-dogging me about this for the past two years will be thankful, as well.

[Rexlan]

Originally Posted by Texas Pooh

The new loan company thinks it got lost, and they keep sending me applications for a duplicate title that they want me to sign and send back to them.

OP is being asked for the collatoral - the loan company wants to get a replacement title to secure the loan.

Zig is right; if OP doesn't comply (and or fess up that he has the title), there is a significant chance that the loan is going to be called.

Respectfully disagree. I don't believe they have no basis to make demand for failure to surrender the title two years after the load was made.

We understand the why they want the title but that was not the question. We also understand that they have recourse if there is a default.

[Rexlan]

Originally Posted by debtcollector`

You did get help. You just didn't like the answer given.

DC

Come on .... give me a break -- what kind of lame BS is that. I asked a specific question and did not get an answer to the question I presented. Apparently you don’t know. Now you come up with this search BS. Geeze ..... thanks.