Benefits to State Titling Agencies
Reducing the Number of Printed Titles
The reduction in printed titles varies depending upon the state and the transactions that are allowed to be performed with electronic titles. Consider the example of a vehicle below with a short life span:
|Vehicle purchased by Owner 1, 1st title issued to lienholder FirstBank||DMV mails Title 1 to FirstBank||No paper title|
|Vehicle sold to Owner 2 who finances the title through MyCreditUnion||Title 1 lien released with signature and mailed by FirstBank to MyCreditUnion.||MyCreditUnion applies for title with lien.|
|DMV mails Title 2 to MyCreditUnion.||ELT lien released, Title 1 printed without lien and mailed by DMV to MyCreditUnion at FirstBank’s request. MyCreditUnion applies for title with lien.||No paper title|
|Vehicle destroyed in accident||Title 2 lien released with signature, mailed by MyCreditUnion to insurance/salvage company||ELT lien released, Title 2 printed and mailed by DMV to insurance/salvage company|
In this scenario, both the ELT and the non-ELT process result in the DMV printing and mailing two titles. This could be reduced by implementing an electronic transfer process during a refinancing or even a vehicle sale that will involve a lien. Another way to reduce the number of titles is to allow anyone to leave the title as an electronic record unless otherwise requested. This would include allowing consumers to keep their title electronic until needed. Title corrections under ELT obviously do not involve printing a paper title. This may or may not be a significant savings, depending on the volume of reissued titles. There are obvious benefits to reducing the number of titles, including intangibles like reducing the need to maintain inventories of title paper and reducing fraud. However, implementing just the basic ELT transactions may not significantly reduce the number of titles needing to be printed over the life of a vehicle.
Other Benefits to State Titling Agencies
One of the best benefits of ELT is the partial automation that comes from allowing lenders to electronically release liens and request paper titles with their lien intact with an option to specify a mailing address for the title. This allows that part of the process to be hands free – title print transactions can be queued without operator intervention.
Benefits to Consumers and Lenders
ELT implementation can be accompanied by a decrease in time-to-perfection, partly because a paper title is not required to be printed. This can lead directly to less fraud, as it reduces the time between when lenders issue a loan and when a lien is confirmed by the State. Consumers benefit by receiving a clean title at loan payoff, since they do not have to return the title to the DMV to receive a clean title. This aids both consumer and lender in case of a lost title, as the lender does not have to become involved in requesting a duplicate title. Lenders also benefit from not having to open and maintain paper title records and authorizing the DMV to mail the title to the customer.