In the sale of a vehicle, the signing of the certificate of title to release ownership often follows the receipt of payment from the buyer. If the seller dies before signing off on the title, however, the buyer may be temporarily out the money without any documentation to signify legal ownership. Finding the right solution in this situation starts with gathering all evidence of the transaction, but then will depend on whether the title has been transferred, the vehicle is part of an estate or the title is not available.
If payment was made before the title was signed off by the new owner, make sure to secure the Bill of Sale and the receipt for the purchase. If payment was made with a cashier’s or a bank check, keep the copy or the tear-off receipt as well. Without a signed title, these documents can serve as evidence of the transaction, which may be needed to prove the purchase of the vehicle to a surviving spouse, a beneficiary or the person charged with distributing the assets of the estate. If the title cannot be transferred through any of these people, the documentation related to the purchase may be needed to apply for a bonded title.
Depending on state laws, a surviving spouse who was not listed on the title may be able to assume ownership by providing a certified death certificate and an Affidavit of Surviving Spouse form. Vehicle ownership also may be assumed by a designated beneficiary if the decedent’s state of residence allows for transfer on death instructions to be included on a vehicle title. In both situations, a request can be made to the new owner to release the title to the buyer.
If the vehicle is part of an estate that must go through probate, the buyer can contact the court overseeing the proceedings to find the executor or the administrator who will be charged with distributing the decedent’s assets. Once appointed, the executor or administrator usually has the power to sign the vehicle title to release the decedent’s ownership. The signed title then can be taken to the state’s DMV or equivalent office, along with state-specific court papers to transfer the title to the buyer’s name.
If getting the title signed off by a surviving spouse, a beneficiary or the probate court cannot be accomplished, the buyer may need to apply for a bonded title. In this process, the buyer would need to provide proof of ownership with a bill of sale and supporting documents, such as the receipt and the cancelled check. These documents also may be used as evidence of the purchase if the buyer’s ownership is challenged by a title holder in court. If approved by an insurer, the buyer can submit a certificate of bond and state-required forms to the DMV to receive a bonded title. If ownership is not challenged or is challenged unsuccessfully, the bonded title generally can be exchanged for a standard certificate of title after three years.
