Your car title is a legal document that describes a vehicle by make, model, year, and VIN. The government creates and issues titles, which provide information on the vehicle’s owner, the car’s condition history, and anyone with a lien on the title. A lien is a promise to pay someone money. Prospective buyers can use the title to verify that the person selling the vehicle to them owns the car. Unfortunately, a bad actor may commit fraud by selling a consumer a car using a fake car title to make money. Car title fraud typically occurs when someone changes a title or vehicle to misrepresent or obscure facts about the car or who owns it.
In this post, we explore the basics of what a car title is, what constitutes title fraud, and how to identify title fraud. We also explain five signs to look out for to indicate a title is fake or is part of a scam. Finally, we help you understand your rights if you unknowingly buy a lemon car because of a fake car title.
Robison Lemon Law Group, LLC, provides exceptional representation to consumers who purchase used or new vehicles that later need excessive repairs or become inoperable. We believe that consumers should not have to stay in a contract for a car they cannot use or is unsafe to drive. Our lemon law lawyers provide diligent and compassionate legal representation to people who unknowingly purchase defective or unsafe vehicles.
What Is a Car Title?
A car title is a state-issued document that gives information about the car, the past owners, and the vehicle’s condition. Common pieces of information that a car title includes are the following:
- The name of the previous owner,
- The dates of the previous purchases,
- The mileage on the vehicle when the last purchase or title transfer occurred,
- The vehicle identification number (VIN),
- If there is a lien on the vehicle,
- The make and model of the vehicle, and
- The year the car was manufactured.
Additionally, the car title includes information about the vehicle, such as if a court declared it a lemon or a salvaged car. The exact definition of a lemon car varies depending on the applicable state law. But in most cases, a lemon is a car with a defect that substantially impacts its value or safety and cannot be repaired after a reasonable number of attempts.
If a court finds that a car is a lemon, the owner of the vehicle may be eligible to receive a replacement vehicle or a refund. In addition, they may be entitled to receive reimbursement for the costs to repair the vehicle and file a lemon lawsuit. This may sound confusing or intimidating for those unfamiliar with the lemon law process. But the lemon laws give consumers important rights if a dealership sells them a defective or unsafe vehicle.
If a car is a lemon, typically, the title will reflect this. But bad actors (or unscrupulous dealerships) may attempt to obscure this fact by committing title fraud.
What Are Common Types of Title Fraud?
Car title fraud occurs when someone alters the title or obscures certain facts about the vehicle, its condition, or its ownership history. Unfortunately, there are many ways that people can attempt to defraud someone else when selling them a vehicle. Common types of title fraud include things like:
- Creating a fake title,
- Changing the title information,
- Rolling back the odometer, and
- Title jumping.
Over the years, how people commit title fraud has become increasingly sophisticated, making it harder for people to catch title fraud early on. If you believe you were the victim of title fraud, you may benefit from talking to an attorney to understand and assert your legal rights.
Creating a Fake Title
One way people commit title fraud is by creating fake titles. People may accomplish this by physically cutting up pieces of an existing, government-issued title and creating a new one. Or they may download a fake title template online and use this to defraud an unsuspecting buyer.
Buyers who do not frequently buy or sell vehicles may not catch the subtle signs that what they have is a fake car title. Even seasoned buyers may have difficulty determining if a title is real or fake. Many of these documents appear valid, and only upon close inspection or after an attempt to verify the information does it become apparent that they are fake.
Changing the Title Information
Bad actors may also commit car title fraud by altering the information on the title. For example, they may change the VIN, ownership history, sales dates, or any other information commonly on the title. They may also remove important notations from the title that indicate the car is a lemon or a salvaged vehicle.
Salvage title cars are cars with damage that makes them unsafe to drive. The salvage notation significantly decreases the value of the car. When someone takes a salvaged car from one state to another, they can sometimes “wash” the vehicle with a salvaged title and get a clean title. This is the case if the new state has more relaxed title laws than the previous state, potentially allowing the used car dealer to remarket the car in a different condition.
Another way bad actors change the title information is by removing liens from the title history. A lien is a promise to pay someone else money. For example, if someone buys a car using a loan, the lender has a lien on the car in the amount of the unpaid debt. When the person pays off the loan, the lender releases them from the loan and clears the lien from the car’s history. Bad actors may alter the title to make it look like the lien is no longer on the title when, in fact, it is, passing along the burden of paying the debt to the new buyer.
Rolling Back the Odometer
Odometer rollbacks are another common and well-known type of used-car or auto dealer fraud. This type of fraud indirectly impacts the authenticity of the title. With an odometer rollback, The seller manually changes the odometer from what it is to what it was when the car was sold previously. In this way, the seller can hide the true age and wear of the vehicle and make the buyer believe the car is in better condition than it actually is. Sellers may do this to increase the sales price and make more money off the purchase than they would if the buyer knew the true mileage on the vehicle.
Title jumping is a fraudulent and illegal practice where someone buys or sells a car without changing over the title information. In essence, the chain of title contains gaps in it because the previous owners of the car did not properly transfer the title to the next owner. Bad actors can use title jumping to sell a car to a buyer even though they do not lawfully own it. They may do this for financial gain or to avoid being traced.
What Are Common Signs of a Title Scam or a Fake Car Title?
Although you cannot prevent all title fraud, you can look for a few warning signs you may be the target of a scam. Common signs that you are or may be the victim of a title scam include the following:
- The seller gives you a title that looks fake,
- The seller gives you a title from another state,
- The seller doesn’t want you to see the title before the sale,
- The physical car parts don’t seem to match the vehicle, and
- The seller does not give you time to review the VIN.
If any of these signs appear during the transaction, it may be a good idea to walk away or ask for additional time to think it over. If the seller resists or attempts to pressure you into going through with the sale now, that may be additional confirmation that you are the target of a scam. One common tactic that scammers use to trap their victims is to put artificial time pressure on them. If you believe you were the unwitting victim of a title scam, an experienced attorney can review your case and advise you of your legal options.
1. The Seller Gives You a Title That Looks Counterfeit
One way to tell if you are the target of a fake car title scam is if the car title appears fraudulent.
Signs to look out for include things like peeling at the edges of the paper or a missing watermark. Additionally, be on the lookout for fuzzy printing, smudging, grammatical errors, typos, and uneven lines or writing. If you have concerns about whether your title is authentic or counterfeit, you can reach out to the state or an experienced attorney to get help with verification.
2. The Seller Gives You a Title That Is From Another State
A sign that the tile may be fake is if it is from another state. Although having a title from another state does not automatically mean that the title is fake, it may be a cause for concern. This is especially true if you are not in an area near a state border or the state of the purported title is far away. In that case, the seller would have to travel a long distance to get the car to you.
Another similar sign is that the previous owner purchased the vehicle in your state, but the state supposedly issued a new title shortly before the sale. This “new” title may not be the real title. The best practice is to be vigilant and walk away if you feel like the seller is trying to get you to agree to something fraudulent.
3. The Seller Does Not Want to Let You See the Title Before You Purchase the Car
Many scammers “hide the ball” or engage in delay tactics when buyers ask to view the title before the sale. The seller may give many excuses about why you cannot see it beforehand. Use your best judgment when deciding if the seller is honest about not wanting you to see the title or if they are trying to wait until the last second to force you to continue the sale. In their mind, it will be harder to back out once you are at the closing table, cash in hand, ready to receive the keys. If the seller is unwilling or unable to show you the title right away, that could be a sign of fraud. If the transaction does not feel right to you, trust your instincts.
4. The Car Parts Do Not Seem Like They Fit the Vehicle
Another sign of title fraud is when the parts on the car do not seem like they belong with the vehicle. In some situations, a car will have rusted parts or individual parts that seem like they do not fit the car. If that is the case, the seller may knowingly or unknowingly be trying to sell you a car that was rebuilt in an attempt to match the title. Additionally, this may be a sign that the title is fake or the seller is trying to hide defects such as a bad CV axle or bad spark plugs. In either case, take an in-depth look at the body of the vehicle, underneath the car, and under the hood. If you are not sure what you are looking for, ask someone you trust for help. If the car or the situation does not match or raises red flags for you, it may be time to walk away or get a second opinion.
5. The Seller Does Not Give You Time to Review the VIN
Another tactic that scammers use is to prevent you from reviewing the VIN history of the vehicle before you hand over the money. You can check a car’s VIN by going to vehiclehistory.gov. Doing so provides you with important information, such as who owned the car in the past, any recalls, or whether it was deemed a lemon. While the website may not list every vehicle, most insurance companies and salvage yards must file a public report when a vehicle has been designated as a “salvage.” If the seller does not want to give you the VIN or will not allow you enough time to do this type of research, you may be the target of a scam or title fraud scheme.
What Are My Rights If I Unknowingly Purchase a Lemon Car Because of Title Fraud?
State and federal lemon laws protect consumers who unknowingly purchase a lemon. Lemon laws allow consumers to file a lawsuit against a dealership or manufacturer if the car has a defect that substantially impacts its value or safety. The car’s defect must usually appear within a certain period of time after the consumer purchases or drives the vehicle for the car to qualify as a lemon.
All state lemon laws cover new vehicles, but not every state covers used or leased vehicles.
The New York lemon law covers used vehicles that meet certain requirements, such as a used car with less than 18,000 miles on it and has a purchase price of at least $1,500. Additionally, the New Jersey lemon law also covers used vehicles if they cost $3,000 or more and have less than 1000,000 on them.
Federal laws also provide consumers with protection against unscrupulous dealerships and manufacturers. The Magnuson-Moss Warranty Act allows consumers to pursue compensation if the manufacturer breaches an implied or express warranty within the warranty period. An implied warranty is not in writing but is implied as part of the deal. An express warranty is in writing and provides explicit protection.
A common misconception is that when someone is selling you a car “as is,” you don’t get a warranty. While there are instances where you may not get a warranty for a used car, the law still requires dealers to issue warranties for “as is” vehicles in certain situations.
If the car breaks down during the warranty period, the dealership or manufacturer may be required to pay you compensation in the form of a refund of the purchase price or a replacement vehicle. Additionally, the dealership or manufacturer may have to pay your attorney fees for you if you win your case.
Contact the Experienced Lemon Law Attorneys at Robison Lemon Law Group
When you fall victim to title fraud, it can be incredibly frustrating, embarrassing, and draining. Further, if you purchase a car that you thought was in good condition but, in fact, is defective, it can be challenging to know where to turn. State and federal lemon laws may protect you and entitle you to compensation, such as a replacement car, a full refund, or reimbursement for out-of-pocket repair costs.
At Robison Lemon Law Group, we understand that not everyone has the time or resources to handle a lemon law claim against a car dealership or manufacturer. Our firm exclusively helps clients recover against these faceless companies. We don’t charge our clients a penny in legal costs at any time during the case, and we only receive compensation if and when we win your claim on your behalf.
Emma Robison learned early on in her career that she enjoyed helping clients fight against these big companies that try to take advantage of consumers by selling them defective vehicles. Clients praise Emma for being professional, attentive, and responsive when they call in.
If you believe that you were the victim of title fraud and purchased a defective vehicle,
contact us today or call us at 844-417-1031 to schedule a free consultation.