Removing a Lien in Arizona
When you finance your car, you don't own it outright until you've completed your car loan payments. In the interim, your car will have a lien placed on its title, which will keep the car in the name of the lienholder. After paying off your loans, it's possible to remove the lien and transfer the title back to you.
What Is a Lien?
A lien is a type of assurance for a property owner that he or she will be paid in full for their property. It typically gives them some leverage over a property buyer.
In the case of a car title, the lien will allow for a lienholder to reclaim the car should the buyer default on his or her loans or fail to satisfy required payments. Additionally, if you have a lien on your car, you will not have the authority to transfer the vehicle's title.
Other Types of Vehicle Liens
Liens on a car title are mostly associated with car loans. However, other types of vehicles liens do exist, such as:
- Child Support liens.
- Operation of Law liens (linked to court fines and fees).
- Mechanic's liens.
What Is a Lienholder?
Most commonly, a lienholder is the person or corporation responsible for writing a car loan. Frequently, a lienholder will be a bank or a financial firm. The lienholder's name will appear on the car title until the time that the buyer pays off his or her car loans in full.
Simply put, if you have a taken out a loan for your car, your lender is the lienholder on your car's title.
Other examples of lienholders can include:
- Local courts.
- Law enforcement.
Title Requirements in Arizona
If you live in Arizona and purchase a vehicle in the state, you're required to apply for a title within 15 days of purchasing a car.
If you're moving to Arizona and your vehicle was registered in another state, you are required to apply for a title and register it in Arizona as soon as you become an Arizona resident.
How to Remove a Lien in Arizona
Once your car loans are paid off, you'll be able to lift the lien and transfer the car title to your name. When you pay off a lien on your vehicle, the lienholder will send you:
- Your Arizona vehicle title.
- A lien release.
You should receive your title and lien release in about 5 business days after paying off your loan.
If you do not receive the title within 15 business days, you can request an administration hearing with the Arizona Motor Vehicle Division (MVD).
Lien-Free Titles in Arizona
In Arizona, you DO NOT need to get a new, lien-free vehicle title—often referred to as a clean title—to transfer the title from the lienholder to yourself.
You can simply keep the original Arizona vehicle title with the lien release as proof that you own the vehicle outright.
However, if you prefer to get a lien-free title, you can go in person to an AZ MVD office with:
- The Title and Registration Application (Form 96-0236).
- The lien release, which must show:
- A description of the vehicle.
- The date the lien was paid off.
- A stamp or other official mark to show the lien is paid.
- The lienholder or agent's signature.
- Payment for the $4 title fee.
Lost Lien Releases in AZ
If you lost your Arizona title and lien release, you can replace the release by asking for a notarized lien release from your lienholder. Take the notarized lien release to an Arizona MVD office and apply for a duplicate title.
Purchasing a Vehicle with a Lien
If you have bought a car in Arizona that has a lien, you are responsible for paying off any unpaid debts to the lienholder before the lien will be released. You will not be able to transfer the title to your name before the lien is satisfied.
Keep this in mind when buying a used car—especially when buying from an AZ private seller. You do not want to be responsible for someone else's debt.
To avoid buying a car with a lien hold, you can check a vehicle's lien status on the Motor Vehicle Division website.