What is a Bonded Title and How to Get One?

What is a Bonded Title/ What Does a Bonded Title Mean?

Why Do I Need a Bonded Title?

When Do I Need a Bonded Title?

How to Get a Bonded Title, for Most States?

How Much Does a Bonded Title Cost?

How Long Does it Take to Get a Bonded Title?

What is a Certificate of Title Bond?

How to Get your Title Bond?

How to Determine the Value of Your Vehicle?

Frequently Asked Questions

What is a Bonded Title / What Does A Bonded Title Mean?

A car title provides legal information about a vehicle i.e., vehicle identification number (VIN), owner, etc. You need a title to buy car insurance, register your car, and sell it to other people. Most owners receive their title after they purchase their vehicles. For example, if you buy a new car from a dealership, the dealership will mail your car title a few weeks after your purchase. However, when you buy a used car, sometimes, there could be issues with the title that requires you to get a bonded title.

Bonded title is essentially a title guaranteed by a surety bond ( a type of financial guarantee). A bonded title is the only way for you to get a title when there is no sufficient proof of your ownership of the vehicle. If you need a bond that can help you become an auto dealer, you're looking for an auto dealer bond. These two bonds are commonly mixed up.

Why Do I Need a Bonded Title?

You need a bonded title for the exact same reasons that you need a regular title, listed below:

• By state law, you are required legally to register your vehicle with your state’s Department of Motor Vehicles (DMV)
• You need your title to buy a car insurance
• You need your title to transfer car ownership
• If you are stopped by the police on the road, they may ask you for your title and if you don’t have one, you could have broken federal and/or state laws

When Do I Need a Bonded Title?

You need a bonded title if there is insufficient proof of ownership, which can happen due to the following reasons:

• Your vehicle has NEVER been titled
• You have never received the original title and can't obtain the title from the previous owner/owners (i.e., dealership or previous owner of the vehicle)
• Your name is not on the title and you can no longer reach the person whose name is on the title to transfer the title into your name
• Your title has some major errors, i.e., wrong VIN number and the DMV tells you that your only option is a bonded title

Sometimes, you don't need a bonded title because a replacement title, duplicate title, or the previous owner can help you establish sufficient proof of ownership:

• If your title is lost or destroyed but your name is on the title, you may not need a bonded title. You may be able to get a duplicate title from your local DMV.
• If you have a Bill of Sale without an accompanying title and there is no liens on the vehicle, you might be able to apply for a replacement title at the DMV
• If your name is not on the title or the title has some issues but you can reach the person whose name is on the title. That person should be able to transfer the title to your name

The best way to find out if you need a bonded title or not is to call your or visit your local DMV. Don’t get a bonded title until your state DMV confirms with you that you need one. Getting a bonded title should be the last resort.

How to Get a Bonded Title, for Most States?

Although the process for getting a bonded title differs a little bit across states, the process described below largely summarize the main steps involved in acquiring a bonded title for most states.

Step 1: If you don’t have your title, make every effort to find your title through contacting the seller and DMV official. If you finally find the title but your name is not on it, try as many ways as you can to get in touch with the person whose name is on the title. The goal is to have the person transfer the title into your name.

Step 2: Determine if you need a bonded title

• You can get this information from browsing on your state DMV site, call your local DMV, or visit your local DMV in person

Step 3: Determine your eligibility for a bonded title for the state DMV

• Most of the time, you need to be a legal resident of the state to apply for a bonded title. For example, you need to have a Texas driver’s license in order to apply for a Texas Bonded Title
• Your vehicle needs to have been registered or titled in the state where you are applying the title. Out-of-state vehicle would need to be verified by a certified Safety Inspection Station or state law enforcement authorities (i.e., police) before applying for a bonded title

Step 4: Fill out a Bonded Title Application Form and bring the form with the following evidence of ownership in person to the DMV

• Supporting ownership evidences such as Bill of Sale, Receipt, Checks
• Photo IDs
• Bonded Title Application Form for the state where you are applying the title. For example, Texas uses Form VTR-130-SOF

Step 5: If your documents are approved by the DMV, you will be told the amount of a Certificate of Title Surety Bond you need to purchase, most of the time between 1.5x - 2x the market value of the vehicle (Texas requires 1.5x and Georgia requires 2x) providing the valuation of the motor vehicle from a recognized motor vehicle valuation and pricing sources such as Kelley Blue Book and NADA Guides. Generally, you should have a minimum bond amount of $6000, which costs around $100. $100 is the lowest you can spend on a title bond. If you choose to have a bond value of 1,000, it will still cost you $100. The higher the bond amount, the more coverage you have in case of a claim. Therefore, it is better to have a higher bond value as long as the cost of the bond is the same.

Step 6: Purchase your Certificate of Title Surety Bond through a surety broker

Step 7: Within 30 days of the initial issuance of your Certificate of Title Surety Bond, you would need to apply for a Bonded Title. Complete the Application for Title Form and bring all the documents to your local county tax office

How Much Does a Bonded Title Cost?

The cost of a bonded title is largely determined by the cost of certificate of title bond, paperwork admin fees, mail cost, etc. While the cost of title bond is consistent across states, the cost of administrative fees is determined by each state’s DMV or Department of Transportation.

Cost of Title Bond:

• Bond Coverage: $1-$6,000. Bond Price: $100
• Bond Coverage: $6,001-$25,000. Bond Price: an additional $15 per additional $1,000 of bond amount, in addition to the $100 minimum bond price. For example, a $7,000 title bond would cost $115 ($100 + $15)
• Bond Coverage: $25,000+ would require underwriting and bond price would depend on credit score and financials of the applicant

Cost of Paperwork

• This cost varies by states. In Texas, the paper processing costs $15. In Georgia, it costs $18. In New York, it costs $10.