When facing vehicle repossession, many car owners are confused and worried about various aspects of the process. One common question that arises is, “Can I keep my license plates when my car is repossessed?” Understanding your rights and obligations regarding your license plates during a repossession is crucial. This guide will clarify what typically happens to your plates when your car is repossessed and what steps you should take.
Understanding License Plates and Vehicle Repossession
Generally, in most states, including jurisdictions similar to New Jersey (based on the provided original article about NJ repossession), license plates are registered to you, the vehicle owner, not the car itself. This distinction is fundamental when dealing with vehicle repossession. When your vehicle is repossessed due to failure to meet the terms of your security agreement (like loan or lease payments), the lender or lienholder is taking back the vehicle. However, they are not automatically entitled to your license plates.
Think of it this way: your license plates are proof that you have registered a vehicle with the state and have permission to operate a vehicle on public roads. The repossession is about the vehicle title and physical possession changing hands, not necessarily your personal registration with the Department of Motor Vehicles (DMV) or Motor Vehicle Commission (MVC).
What Happens to Your License Plates During Repossession?
In most cases, you are expected to remove your license plates from the vehicle once it has been repossessed. While laws can vary by state, this is a common practice and often legally required. Leaving your plates on a repossessed vehicle can lead to complications and potential liabilities for you.
Here’s why you should remove your plates:
- Plates are linked to you: As mentioned, the plates are registered to you. If they remain on the repossessed vehicle and it is involved in any incidents (parking tickets, traffic violations, accidents) before being legally sold and re-titled, these issues could potentially be traced back to you as the registered owner of the plates.
- Prevent misuse: Removing your plates prevents the lender or subsequent buyers from improperly using your plates. New plates will be issued to the new owner once the repossession process is complete and the vehicle is legally sold.
- State Regulations: Many states have specific regulations about returning or surrendering plates after you no longer own the vehicle they were registered to. Failing to do so can sometimes result in penalties.
Steps to Take Regarding Your License Plates After Repossession
- Remove the Plates Immediately: As soon as you are aware that your vehicle is going to be or has been repossessed, safely remove your license plates.
- Return or Surrender Your Plates to the DMV/MVC: Contact your local DMV or MVC (in the context of the original article, the New Jersey MVC). They will provide instructions on how to properly surrender your plates. Some states require you to physically return the plates, while others may allow you to notify them online or by mail that you are surrendering them due to repossession. This officially disconnects your registration from the vehicle.
- Keep Records: Document the date you removed the plates and the date and method of surrendering them to the DMV/MVC. This documentation can be helpful if any issues arise later.
- Consider Transferring Plates (If Applicable): In some states, you might have the option to transfer your existing plates to a new vehicle if you purchase one shortly after repossession. Check with your local DMV/MVC about transfer options and fees.
What About the Repossession Process Itself? (Context from Original Article)
While the original article focuses on the lienholder’s process in New Jersey, understanding the basic steps can provide context. In New Jersey, as outlined, a lienholder repossessing a vehicle must:
- Have a certificate of title: To legally re-title or sell a repossessed vehicle, they need the title. If the title is lost, they must obtain a duplicate.
- Follow specific procedures: This includes completing forms like the “Notice of Seizure of Motor Vehicle” and “Application for Repossession Certificate of Ownership” and submitting them to the New Jersey Motor Vehicle Commission.
- Notify the owner/debtor: They must send a “Notice of Sale” to the vehicle owner, giving them a reasonable time to redeem the vehicle before it is sold.
- Complete required paperwork for sale: To sell the vehicle, they need the original title (or duplicate), application forms, the security agreement, the Notice of Sale copy, and potentially a Power of Attorney, along with the required fees.
This process highlights that the repossession is a legal procedure involving the vehicle’s title and ownership transfer. Your license plates are a separate matter concerning your vehicle registration.
Conclusion
To directly answer the question: Yes, generally, you can and should keep your license plates when your car is repossessed. It is your responsibility to remove them and handle them according to your state’s DMV/MVC regulations, which often involves surrendering them. This protects you from potential liabilities and aligns with standard procedures. Always contact your local DMV/MVC for the most accurate and state-specific instructions regarding license plates and vehicle repossession.
