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What Are the Different Types of Car Titles?

  • 4 MIN READ|
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  • by Joseph Priebe|
  • January 8, 2021 |
  • Personal Finance

What are the different types of title loans?

Most of us know that a car title serves as a certificate of legal ownership, but who knew it is also called a pink slip? When a car is purchased, the title is transferred to the new owner.

Your state's DMV, MVD, or Secretary of State issues you the title. It indicates who the owner is and information about the car, such as the make and model. If you need to sell your vehicle, refinance or buy one, it's essential to know what each car title represents.

There are different classifications of car titles, and the main types include:

Clear Title

Out of all of the different types of titles, a clear title means you have 100% equity in your car. This makes you eligible to sell your car to another party. This title indicates there is no outstanding financial burden on the vehicle to prevent it from being sold.

Lienholder Title

If your vehicle has a title loan or you are still making payments, the title is in possession of the lienholder. The title will list the lender as the lienholder, and you will be listed as the owner.

Salvage Title

A salvage title is issued to a car with a significant value decrease due to a substantial accident, subsequent repair, or theft. Typically, a vehicle will receive a salvage title if it loses more than 75% of its original value. A salvage title is generally issued by the car's insurance company. So long as the vehicle can pass a safety inspection, cars carrying this title are legal to drive.

Dismantled Title

A dismantled title is similar to a salvage title. It's given to cars that have been severely damaged, and repairing them would not make financial sense. Suppose the cost of repair is higher than the vehicle's value. In that case, a dismantled title is needed to sell any remaining valuable parts.

Junk Title

A junk title is issued to sell a car for parts or scrap metal if it has been sold to a junkyard.

Bonded Title

If a car has missing ownership documents, a bonded title is given along with a security bond equal to the car's value to the new owner to ensure they are protected should a future ownership claim arise. A bonded title is valid from three to five years.

Reconstructed Title

For cars that have gone through major repairs or transformation, the insurance company issues a reconstructed title. The care must be inspected and deemed safe for public roads before a reconstructed vehicle can be registered for normal use.

Rebuilt Title

Somewhat similar to a reconstructed title, but this title is for vehicles that have been significantly rebuilt. Much like the reconstructed title, it is issued by the insurance company or the place where the repair work was completed. Once the car passes a safety inspection, it is legal for use on public roads.

Water Damage Title

This title is issued to cars that have significant damage from water. As a best practice, you might consider having a car inspected for water damage, especially when buying a used car, to guarantee no surprises.

Odometer Rollback Title

It is illegal to turn back a car's odometer. If that has occurred, an odometer rollback title is given to the car.

Lemon Title

Although each state has different laws defining what makes a car a lemon, if a car has many components that don't function properly and is unsafe to drive, it may be branded as a lemon. However, before that occurs, the car has the opportunity to be repaired. If the problems persist, it will then be branded its official lemon title.

Export Title

To clear customs, an exported vehicle needs documentation. A clear title will not be possible if a vehicle is not declared at the exit point. To avoid port storage fees from accumulating, start the title process early.

Import Title

An imported vehicle to the U.S. must have a legal title to clear customs. Suppose your vehicle was not manufactured for the U.S. market. In that case, you'd need to meet certain requirements to certify that the vehicle is legal to operate in the United States.

The Environmental Protection Agency (EPA), Department of Transportation (DOT), National Highway Transportation Safety Administration (NHTSA), and other agencies need to verify that your vehicle meets standards for emissions, safety, and other guidelines before entering the states.

Electronic Title

Paperless or electronic titles are available from certain state title systems. You can request to obtain a title document for getting a loan or a transfer.

Look Out for Car Title Laundering or Washing

If you're buying a car that was last registered in another state, look out for title washing. Any attempt to hide or change a vehicle's designated title is against the law. This is designed to discourage car sellers from selling damaged cars for more than they are currently worth. States classify titles differently, which means if you purchase a vehicle in another state, it may not transfer. Research your state's title classifications to verify that a vehicle from another state has a valid title. It's always a good idea to have the car inspected by your mechanic and get a vehicle history report online.

Research Title Types in Your State

If you're ready to buy a car, it's best to be in the know about car titles. Check out your state's title classifications with these links.

Alabama Vehicle Title Information

Alaska Vehicle Title Information

Arizona Vehicle Title Information

Arkansas Vehicle Title Information

California Vehicle Title Information

Colorado Vehicle Title Information

Connecticut Vehicle Title Information

Delaware Vehicle Title Information

Florida Vehicle Title Information

Georgia Vehicle Title Information

Hawaii Vehicle Title Information

Idaho Vehicle Title Information

Illinois Vehicle Title Information

Indiana Vehicle Title Information

Iowa Vehicle Title Information

Kansas Vehicle Title Information

Kentucky Vehicle Title Information

Louisiana Vehicle Title Information

Maine Vehicle Title Information

Maryland Vehicle Title Information

Massachusetts Vehicle Title Information

Michigan Vehicle Title Information

Minnesota Vehicle Title Information

Mississippi Vehicle Title Information

Missouri Vehicle Title Information

Montana Vehicle Title Information

Nebraska Vehicle Title Information

Nevada Vehicle Title Information

New Hampshire Vehicle Title Information

New Jersey Vehicle Title Information

New Mexico Vehicle Title Information

New York Vehicle Title Information

North Carolina Vehicle Title Information

North Dakota Vehicle Title Information

Ohio Vehicle Title Information

Oklahoma Vehicle Title Information

Oregon Vehicle Title Information

Pennsylvania Vehicle Title Information

Rhode Island Vehicle Title Information

South Carolina Vehicle Title Information

South Dakota Vehicle Title Information

Tennessee Vehicle Title Information

Texas Vehicle Title Information

Utah Vehicle Title Information

Vermont Vehicle Title Information

Virginia Vehicle Title Information

Washington Vehicle Title Information

West Virginia Vehicle Title Information

Wisconsin Vehicle Title Information

Wyoming Vehicle Title Information

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