Removing a Lien in Nebraska

When you take out a loan to buy a car, there is typically a lien placed on your car title. The lien will remain on your title until the car loan has been paid in full, at which point, you can have it removed through the Nebraska Department of Motor Vehicles (DMV).

What Is a Lien?

A lien is a form of legal collateral for a property owner or service provider. It ensures that he or she will be paid in full for what they offer.

On a car title, a lien will give the lienholder the legal right to repossess the car should the buyer cease making payments or default on his or her car loan.

Types of Liens in Nebraska

While a car title lien is common in Nebraska, the state allows for several other types of liens to be placed on your vehicle, including:

  • Storage-repair lien—For persons or companies who have performed work on or stored a vehicle.
    • The car may be sold to settle the debt:
      • After it has been in the service provider's possession for 90 days.
      • No less than 30 days after the owner has been notified of the intent to sell the vehicle.
  • Artisan's lien—For persons or companies who have performed work on or material for a vehicle that is no longer in their possession.

Who Is a Lienholder in Nebraska?

The person or company at financial risk should a loan or bill go unpaid is typically the lienholder. In the case of your car title lien for your Nebraska auto loan, the lienholder is the individual or entity responsible for issuing your car loan. A bank, credit union, or another financial institution is usually the lienholder on a car title.

Throughout the duration of the loan, the lienholder's name will likely be on the NE car title, and the lienholder will also be in possession of the document.

Removing a Lien from a NE Title

Electronic Liens

Car titles issued after November 1, 2010 that have a lien will be stored electronically by the DMV.

If your lienholder is a member of Nebraska's electronic lien and title program, they are required to notify the DMV of the lien release within 15 days of receiving the final payment. The lien-free title will then be printed out by the DMV and mailed to you.

If your title was issued after November 1, 2010 and your lienholder does NOT participate in the state's electronic car title program, the lienholder has 15 days from receiving the final payment to submit a Nebraska Electronic Lien and Title Non-Participating Lender Lien Release form to the NE DMV. The title will then be printed and mailed to you.

Paper Liens

If you have a lien on your paper title, the lienholder must:

  • Note the cancellation of the lien on the face of the title.
  • List the date of cancellation on the title.
  • Forward the title to the Nebraska Department of Motor Vehicles.

The NE DMV will then make note of the lien release at their office before mailing the title to you. The lienholder must initiate the process within 15 days of the final loan payment.

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