Important Things To Watch Out For In A Bonded Title
A bonded title, also known as a surety or lost title bond, is issued when proof of ownership for a vehicle cannot be provided. While it can help you register and legally use a vehicle, there are several important factors to watch out for before proceeding.
All About Insurance provides bonded title in Houston, Spring, TX, The Woodlands, Conroe, Humble, TX and surrounding areas.
- First, verify eligibility. Not all vehicles qualify for a bonded title—salvage, stolen, or abandoned vehicles may be ineligible. Check your state’s Department of Motor Vehicles (DMV) requirements before applying. Some states require additional inspections, appraisals, or documentation to confirm the vehicle’s identity.
- Second, confirm the vehicle’s history. Run a Vehicle Identification Number (VIN) check through the National Motor Vehicle Title Information System (NMVTIS) or a similar database. This ensures the car is not reported stolen, has no liens, and matches the information on your bill of sale. Any discrepancy could lead to title denial or even legal issues.
- Third, understand the bond’s conditions and limits. The bond protects prior owners or lienholders—not you—if a legitimate ownership claim arises. If someone proves legal ownership, you could lose the vehicle, and the bond company could demand reimbursement for any payout.
- Fourth, pay attention to the bond amount and duration. Most states require the bond to be worth 1.5 to 2 times the vehicle’s appraised value and valid for three to five years. After that period, if no claims arise, you can apply for a standard title.
- Finally, use a reputable surety company. Only purchase a title bond from a provider licensed in your state. Scams or improper bonds can delay your title or invalidate it entirely.
A bonded title can be a useful solution—but only if handled carefully, with proper research and documentation. If you would like to discuss your specific situation or have questions, please don’t hesitate to call or email.