Maine Title Update – Some Good News (Sourced from MADA)

It is not news that the Maine Bureau of Motor Vehicles (BMV) has a significant title backlog, or that the backlog will continue for quite a time yet. There are many reasons for this situation:

• a 3 ½ month self-imposed shutdown of BMV offices;
• an ability to do the title work from home;
• a limitation on the number of personnel allowed in the building when operations resumed;
• a sales rate which did not reduce as much as expected;
• the inability, until recently, of BMV to hire and train personnel to replace retiring employees or those who chose to move to a different job within or outside state government.

It is also not news that lienholders are becoming more aggressive in their demands for a title. And here is perhaps some good news. Maine law has a provision which states that a security interest in a vehicle is perfected by the delivery to the Secretary of State of a MCO/MSO or existing title, a completed application for a new title which contains the required lienholder information, AND the required fee – all three (3) are necessary.

So what does this mean, and how does this help?

What it means is that dealerships can obtain a document from INFORME which presents the current status of a title application and, most importantly, provides an “entered date” which is the date a lienholder’s security interest is perfected. This “entered date” is significantly earlier than the date the new title is actually issued. Dealerships can provide a lienholder with this INFORME printout to show that a lien is perfected.

The data at INFORME is best obtained with a subscription. Information is available here.

The specific language in Maine law is found in MRSA Title 29-A, Section 702, Subsections 1-3, and reads as follows:

Perfecting Security Interest

1. Valid against creditors, transferees and lienholders. A security interest in a vehicle for which a certificate of title is issued is not valid against creditors of the owner or subsequent transferees or lienholders unless perfected as provided in this subchapter.
2. Method. A security interest is perfected by the delivery to the Secretary of State of:
   1. The certificate of origin or existing certificate of title or certificate of salvage;
   2. An application for a certificate of title containing the name and address of the lienholder and the date of the security agreement; and
   3. The required fee.
      
3. Date: A security interest is perfected as of the date of delivery under subsection 2.

The INFORME system is designed so that dealerships and others can obtain certain information from State of Maine files. For dealerships, title data is one such use. In addition to the problem described above, dealerships can obtain all lienholder information, current at the time of a trade-in, which indicates whether a Human Services lien exists, whether a SALVAGE of REBUILT designation applies, etc. Dealerships have mentioned the cost of the INFORME system lookups as a factor in how often, or whether, the system is used. MADA recently met with the new leadership of BMV, and that topic was discussed. The INFORME system can be helpful.

Sourced from the Maine Automobile Dealers Association news bulletin. You may view the news bulletin here.