Who is the Lien Holder on a Car Title?

by Neil Kokemuller
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The lien holder on a car is the lender that the owner must repay to gain clear possession of the title. As long as you still owe on the loan, the lien holder's name remains on the title.

Lien Holder Basics

A lien is a conditional right of repossession common on property loans. With a car, the lien gives your creditor the right to repossess your vehicle if you don't meet the repayment terms in your loan agreement. When you or a dealership complete registration of the title after purchase, the lien holder's name and address are included on the title application. They remain there until the debt is paid.

Payoff and Other Lien Holders

After you pay off your loan, the lender normally completes the necessary paperwork to remove itself from the title. You then receive the clean title in the mail within a few weeks. In some cases, personal lenders or individuals place themselves as lien holders on a vehicle. A parent might do this when selling a vehicle to an adult child, with the expectation of receiving payment on the vehicle. After a lien holder is officially registered on a title, he must sign the title for removal.

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