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What do I do if a lien holder won't sign the lien release after I pay the lien?

Does anyone have some advice??? I purchased a car for $200 from a guy who WAS a friend of mine. Instead of paying him the money right away we decided to have the title switched over to my name and just put a $200 lien on the title with him as the lienholder. I later paid him the $200 with a money order that lists him in the "pay to" section and the car make, model, and VIN in the "Description" section. I figured I would just get the lien release shortly before the next time that I renew the tags. He has now found out that he could have gotten more for the car from another friend and won't fill out the lien release. He has the title (with me listed as the owner) in his possession and refuses to give it to me. He has also sent his friends to my house saying that they were going to take the car. What are my options?
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Comments

  • You still have the receipt for the money order - yes or no? If yes, contact the sheriff's office in your locale and see if they can help. If no, then you are up the creek. The title should be in your possession, not his. You were simply naive in this transaction and your "friend" is an SOB who is taking advantage of you.

    In the future you should get a separate bill of sale for any major purchase such as a car. And you should have the title with the name of the lien holder on the title. Sometimes a bank or a leasing company will hold onto the title, but never another individual.

    If you are listed as the "owner" on the current title, then the "friend" can't sell the car without forging your signature. Forgery is illegal, but perhaps not beyond what this friend might do. You have the car and he has the title and neither of you can do anything (legally) to sell the car. If you give up possession of the car under intimidation then you have zippo. Hold onto the car. Document the $200 money order made out to the seller, and seek legal help.
  • The title should be in your possession, not his.
    The title is in the possession of the lien holder...When you pay off the loan then you get the title. Doesn't matter if it's an individual or established bank.
  • Mike, if I understand the OP correctly he did pay off the lien, but now the lienholder wants more money than they agreed upon. Small claims court is really the only way to get the title.
  • Mike, if I understand the OP correctly he did pay off the lien, but now the lienholder wants more money than they agreed upon. Small claims court is really the only way to get the title
    I agree...I was responding to Uncle Turbo..And the way he made is statement led me to believe that the owner of the car should be in possession of the title BEFORE it's paid off.
  • Like I said in the other thread. In Minnesota, you have and hold the title but the title indicates the lien holder. Once the lien is paid, you get a lien release. You take the lien release and the title to the DMV and get a new title issued that has no lien holders indicated on it. Many people don't bother to do this though and it doesn't matter.

    I believe he has the title but indicates a lien on it. He paid the lien, but the friend refuses to give him a release after payment. This is a breech of contract. The OP has the title and there is no way the friend has any claim to the car now and especially since the lien has been paid.

    So like I said, possibly the DMV can force the issue with proof of the payment of the lien and issue a new title with no liens indicated on it regardless of the wishes of the friend. The other way is to go to small claims and get a court order to either the friend to release the lien or to DMV to reissue the title. Should be simple but bothersome. In the meantime if any of the friend's friends try to do anything with the car, they have absolutely no claim and the Sheriff should be called. Its called theft or harrassment.

    In this case, make new friends and keep your old ones doesn't apply and is bad advice. First stop DMV. Second stop local court.
  • This is a good example of why you should NEVER do business with family or friends.
  • "This is a good example of why you should NEVER do business with family or friends."

    I see it as a reason why you should never do business with a scumbag. Unless you build in protection from them.
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