Car Title vs. Registration

A car title is a legal document that demonstrates proof of ownership of a particular vehicle as recognized by a specific state’s DMV. Transferring ownership of the car requires a certified copy of the title that passes from the seller to the buyer. The title includes: 

• All listed owners, including name and address
• Details about the car, including make, model, Vehicle Identification Number (VIN), model year, and color 
• Title issue date
• Current mileage 
• Outstanding liens

Several types of car titles exist. Knowledge of these car title types can help you avoid insurance snafus and paying good money for a car that’s difficult to register. 

Types of vehicle titles

Brand-new cars come from the factory with a clean title. However, the title’s status can change throughout the vehicle’s life to include any of the following: 

• Clear: Vehicles contain a clear title when no conflict of ownership exists. Financed or leased vehicles don’t have clear titles. 
• Bonded: When no ownership documentation exists for a car, individuals use cash collateral to establish ownership. 
• Lemon: Cars determined to be lemons often include this designation. However, certain states don’t mandate this labeling, so don’t assume lack of lemon branding means the car has never been involved in a lemon law claim.
• Flood: Vehicles with a flood title have been severely water-damaged. 
• Salvage: In the context of a title, the salvage title meaning translates to a wrecked vehicle that’s no longer safe to drive. Insurance companies determine when to salvage a car, and only certified entities (such as body shops) can rebrand that title once repaired. 
• Rebuilt/Reconstructed: A rebuilt title and a reconstructed one describe similar events. This title type recognizes that the car has been totaled in the past and repaired or reconstructed to meet inspection requirements. In comparing a rebuilt title vs. a salvage title, many vehicles do not get past the salvage stage to safely and legally drive down the road once more. 
• Junk or dismantled: A specific title designation for vehicles sold for parts only.

If you purchase a car from a private party, these title terms are critical to informing your decision. Title types such as junk and salvage are extremely difficult to insure and register. These title designations can also tell you about the car’s history, especially lemon and flood titles. 

Most people obtain a car title once they’ve paid off any outstanding loan on that vehicle. However, you may not be familiar with how the title changes hands and how you can request a certified copy of the title should you need one. Below are the steps involved in getting a car title: 

1. When you pay off your car loan in full or for a vehicle outright, the dealership you bought the car from sends the title to the local DMV for processing. 
2. The state then completes the necessary paperwork to transfer ownership from the dealership to you and mails you a certified copy of the title for your records. 
3. Should the title get lost or damaged, you can request a duplicate copy by submitting a notarized application and the corresponding fee. 
4. The title must reflect current ownership if the car changes hands (even among family members). Keeping the title current simplifies the registration process. 
5. Learning how to sign over a car title can require some research. Make sure you know which information to include and where to sign. Improperly filling out the title to transfer ownership can jeopardize the sale.

Believe it or not, there are several benefits of having two names on a car title. You can typically find better insurance rates, improve the car’s resale value, and transfer ownership with less hassle if a car title includes two names. Remember that both names listed must sign the title to a subsequent buyer to transfer ownership.  

A vehicle registration represents a document filed with your state’s Department of Motor Vehicles that grants you the legal right to drive on public roadways. Each state has its own registration laws and related fees. For most, car registrations must be renewed every one to two years. While a vehicle’s registration may list the owner as designated on the title, these two documents exist separate from one another entirely. 

If you’re wondering what a car registration looks like, the following list represents the information typically found on a registration card or document: 

• Your full name and physical address
• Car title identification number
• VIN
• License plate number
• Car’s make, model, and model year
• Registration expiration date  

When you register your car, you receive proof you’ve submitted the proper documents and the required fees. If you move out of state, you must register your vehicle within that state per local laws. Driving an unregistered car can result in fines and even jail time. 

When does car registration expire? 

Car registrations typically expire every one to two years. Most state DMVs mail out renewal notices the month before the current registration’s expiration. You then have 30 days to register your vehicle. If you’re unsure about your state’s registration process and renewal procedures, visit your local DMV website for more information. 

Car tags (or stickers) and registration reflect a similar meaning but are separate components of registering a car with your state of residence. The tags you receive demonstrate your vehicle registration is current and when the registration will expire. For example, many states issue a month and year sticker initially but only update the year sticker as you renew your registration. 

In contrast, registration documents include the information necessary to demonstrate to local authorities that your car’s registration is current. The information on the registration should match a file at the local DMV, which a police officer can cross-reference to ensure you’re the legal owner of the vehicle in question. Registering your vehicle also proves that you’ve paid the necessary fees to contribute to road upkeep and other state transportation initiatives. 

Registering your car doesn’t require specialized knowledge, such as how many miles a gallon of gas gets you in your particular vehicle. Instead, follow the steps below to register your car. 

1. Obtain car insurance

Most states require some form of car insurance before registering your vehicle. You can obtain car insurance quotes online or simply add your car to an existing policy if you have one. 

2. Register online or in person

Local laws dictate how you can register your vehicle, depending on whether you need to register for the first time or just renew. If you received a temporary license plate from the dealership, register your car before it expires to avoid late fees.

3. Gather required documents

Save yourself time by gathering the following before you begin registering your vehicle:

• Proof of insurance
• Valid driver’s license
• Car’s title
• Bill of sale or certificate of origin 
• General vehicle information (make, model, mileage, color, etc.) 
• Emissions and safety certifications (as required by state laws)

You may be required to submit the documents above during the registration process. If you are leasing or financing the car, the dealership will send a copy of the title and the bill of sale.

4. Complete the application or visit DMV

A Department of Motor Vehicles (or equivalent) representative will guide you through the registration process, including the application. At this stage, you’ll identify any modifications to the car. 

5. Pay fees and update vehicle

One of the final steps involves paying any fees based on where you live and what type of vehicle you’re registering. You’ll then place the license plates you receive on your vehicle, with any stickers applied in the appropriate pattern. Keep a copy of the registration with you in case you get pulled over. 

Administrative fees surrounding car titles and registrations vary from state to state. The National Conference of State Legislatures maintains a list of vehicle registration fees by state, but it’s best to check with your local DMV for updated pricing. Most registration fees are based on a vehicle’s weight, age, value, or any combination of the three, although some states simply charge a flat fee. 

You can typically pay for your car inspection cost, registration, and title with a credit card, similar to using a credit card for a down payment on a car. Most DMV websites list accepted payment methods and any associated fees. You can also call ahead to clarify payment before visiting the DMV.