Does the spelling matter much on a car title?
January 5, 2011 10:08 AM   Subscribe

Slight misspelling of bank's name on my car title - pursue fix or let it go?

My credit union just forwarded to me the title of my car (small yay). The name of the "first lienholder" is "LGE COMMUNIYT CR UN" -- communiyt instead of community. Since the whole bank name is sort of approximated, I'm guessing the slight and obvious misspelling isn't an issue -- is it?

There is a good chance I will sell my Mazda3 sometime in the next couple of years.

The credit union is based in Georgia, the title is issued by the State of North Carolina (where I live), and the full name of the credit union is LGE Community Credit Union.

They are awesome, in case anyone is looking for a credit union.
posted by amtho to Law & Government (12 answers total)
When you sell it, you will have to first pay off the lien and the credit union will acknowledge that on that very title. Else you can't transfer ownership. So it won't hold up a sale. It's really the bank's problem to correct — in theory, you could claim that you don't owe them any money because they are not "LGE COMMUNIYT CR UN. At best, that would buy you some time while they fixed it, so that's not a big issue for them, and it's really no issue to you. IANAL, though.
posted by beagle at 10:13 AM on January 5, 2011

I had a huge hassle several years ago getting the title to a truck after the loan was paid. The bank had changed names between the purchase and the payoff. The title showed the old name and the lien release showed the new one. The names were very slightly different, but not quite as close and obvious as your example.

The state (Kansas in this case) wouldn't remove the lien or convert the (Iowa) title to a Kansas title until the bank had written a second letter noting the name change. It took a few months, many letters from the bank, and a trip to Des Moines to get it sorted out. First the VIN wasn't on the name change letter, then the new name was misspelled, then the VIN was incorrect by a letter and on and on.

This was an odd case and the people at the bank made it much harder than it needed to be, but realize that the state can be very picky about this if they want to. I'd get it corrected now to avoid a similar situation.
posted by Clinging to the Wreckage at 10:20 AM on January 5, 2011

Response by poster: Oh - I didn't make it clear: the credit union forwarded the title to me because I just paid off the car.
posted by amtho at 10:21 AM on January 5, 2011

It's a non-issue then. You own the car, you have satisfied the loan, they returned the collateral (the title). The first lien holder is done and out of the picture.
posted by fixedgear at 10:31 AM on January 5, 2011

That's pretty clearly meant to say "community." Anyone who decided to cough up a hairball about it would be a major-league jerk. Although, in the motor vehicle bureaucracy it's not at all unlikely that you'd encounter one of those fellows... so I guess I don't have any advice one way or the other. Even if this did create an obstacle down the road, I doubt it would be insurmountable. How risk-averse are you and how much free time (and willingness) do you have to pursue this right now?
posted by The Winsome Parker Lewis at 10:32 AM on January 5, 2011

Unless something's different in North Carolina, you'll have to have a lien release to sell the car and remove the lienholder from the title. Physical possession of the title doesn't mean that there are no liens. I have the title to my van and there is a lien on it currently. It sounds like the lien is still listed on the title from your wording. If the title also says that the lien is satisfied, then I agree that you're in the clear, but if it only lists 'first lienholder' I'd still look into getting it fixed.
posted by Clinging to the Wreckage at 10:38 AM on January 5, 2011

This was in Florida about 15 years ago:

When I paid off the only car I ever took a loan to pay for, they put a big ol' stamp on the title and filled out something on it so that I could get the title re-issued.

They said that I could simply file the title away until such time as I sold the car, however that they suggested I pay the nominal fee and get the title re-issued w/o the lien information. Their reasoning had a lot to do with the sort of thing Clinging mentions - if there's a paperwork hassle that is very much not the time you want to deal with it.

The NC form MVR8 (removal of lien form) indicates that you have to attach documentation indicating you have satisfied the lien. Did your CU provide you anything with the title? Odds are that if they did it'll indicate the vehicle information, maybe including VIN.

If that's the case I would wager the DMV isn't going to look twice at the odd abbreviation on the title. You indicate in the application form if it's a 1st or 2nd lien and you'll be accompanying it with proof of satisfaction. Since the title will only have (from what you have told us) information about a single lien and you're providing proof that you've satisfied that lien then they must be one and the same.

Being logic, that may well not apply to the procedures of a government office. However those sort of weird shortenings are pretty common. Given that your state still hasn't moved to more rapid titling I imagine they're relying on the other documentation to match things up, not that shortened field.

Send in the form. If you're not selling the car immediately what difference does it make if they kick it back once? It's not like anyone but the state can correct the odd shortening on the title anyway.
posted by phearlez at 11:43 AM on January 5, 2011

Response by poster: Well, the "Lien Released By" section is filled out, stamped, and signed by the credit union. Should I apply for a fresh title with no lienholder or release?
posted by amtho at 2:31 PM on January 5, 2011

This is not an issue. Some car titles get transferred with only slightly legible penmanship scrawl. Believe me, this is nothing.
posted by dhartung at 10:26 PM on January 5, 2011 [1 favorite]

Well, the "Lien Released By" section is filled out, stamped, and signed by the credit union. Should I apply for a fresh title with no lienholder or release?

It's your money. My state (PA) charges $25 or so to re-issue a title, I'm guessing your state does, too. You have a valid title that shows that the loan has been satisfied (lien released) and that you own the car.
posted by fixedgear at 6:21 AM on January 6, 2011

I would get the fresh title because who knows what the situation with that CU is going to be in, say, 4 years when you sell that car? Maybe the CU gets absorbed by another (like my old one, Easter Financial did) and they cycle their paperwork out to some off-site storage. Maybe they do that anyway for records over 12 months old. So if you have an issue making the transfer to the new buyer you could have a challenge getting them to straighten out their crap.

Or perhaps they can get those records but they demand a document fee. If they demand that now you can stomp your foot and demand that it's their obligation to provide them since you just paid off your loan.... and you can afford to be a pest for a week till they agree. If you had a buyer breathing down your neck to finish the sale you'd have less latitude to fix the problem at your leisure.

I'm sure most transfers go off without a hitch, but personally I like that my titles are in a file in my fire safe and I can sign them and be shut of it without a worry. Whether that security is worth the $15 that NC charges for the "Removal of Lien(s) from Certificate of Title" to you is your call. I'd pay it.
posted by phearlez at 8:31 AM on January 6, 2011

Oops, left off the link to NC's fees listing.
posted by phearlez at 8:32 AM on January 6, 2011

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