Key Takeaways:
- Inheritance, divorce, and gifts are common reasons to remove someone from a car title
- Each state has different required documentation and fees to remove someone from a title
- There may be tax considerations to transfer a title out of one person’s name, each state differs
When you own a car with another person, both owners appear on the vehicle’s title. As long as you both remain current owners, you don’t have to worry about the car title. But when something changes, and there are two names on the car title, you must know how to remove one.
The steps to remove someone from a car title are pretty straightforward, but each state has different nuances. The key is understanding what type of documentation you need if you can apply online or in-person, and the cost.
Reasons to Remove Someone From a Car Title
Owning a car with someone else may feel right at the moment, but sometimes life changes, and you need to remove someone from a car title. The reason you need to remove an owner determines what steps you must take. Here are the most common reasons this happens.
- Inheritance
- Divorce
- Gifted vehicle or vehicle transferred to a family member
- Death of a co-owner
5 Steps to Remove Someone From a Car Title
Removing someone from a car title requires specific steps, and most states follow the same process. Understanding the steps and the documentation required can help the process go smoother.
1. Determine Ownership Type and Get Consent
Look at how your car title names the owners. If there is an ‘and’ between names, both owners must sign the title to transfer ownership or to reduce it to one owner. However, if an ‘or’ exists between names, one owner can sign the title to transfer ownership.
Understanding how you hold title is the key to any transactions involving the car title, including selling the car, borrowing a title loan, or using the car as collateral for a personal loan.
2. Complete Paperwork
You’ll need specific documents to transfer a title. Your local DMV will state what specific documents are needed, but in general, have the following documents ready:
- Original title
- Car insurance card
- Government-issued ID, such as a driver’s license
- Odometer reading
- Bill of sale (in some states)
- VIN verification form (in some states)
3. Apply for a New Title
Check with your Department of Motor Vehicles requirements to determine if you must complete an application to do a title transfer. At the very least, you must visit your DMV with the required documentation, including a signed title, to start the process.
4. Determine Tax Considerations
- Transferring ownership of a vehicle could trigger a tax liability. This is especially true if you gift the car to someone because the donor is responsible for covering the tax liability. You may need to complete IRS Form 709 to ensure tax compliance. In addition, if you sell the car, there may be sales tax due to the federal or state government.
5. Change Car Insurance Appropriately
Immediately after transferring a car title, be sure to change insurance to the appropriate names. This ensures you have protection should anything happen after your name is removed from the title.
Special Considerations When Removing Someone From a Car Title
Certain situations require extra documentation or steps before removing someone from a car title. Here are a few examples:
- Transferring an Out-of-State Title: If you’ve recently moved or are transferring the car from an out-of-state owner, you may need to complete state-specific applications.
- Transfers Due to Divorce: You must follow the court-ordered divorce decree or settlement orders to properly transfer a vehicle after divorce.
- Transfers Due to Inheritance: The estate’s executor must handle the transfer and follow all orders from probate court, including providing the official death certificate.
- Transferring Title With a Lien Holder: You must get the lien holder’s consent to transfer a vehicle title with a lien on it or pay the lien in full before transferring the title, proving the car is paid.
What are the Fees to Transfer a Vehicle Title?
| State | Fees to Transfer Vehicle Title |
| Illinois | $15 |
| Florida | $75.25 |
| Texas | $2.50, unless car is not fully registered |
How to Add a Name to a Car Title
Adding a person to a car title is similar to removing an existing owner. While each state has different requirements, here are some of the basic steps:
- Provide current title: On the back of the title, owners sign it as the ‘seller’ even though you aren’t selling the car. Then, in the buyer section, you state your name and the name of the person you’re adding.
- Complete an application: Check your state’s requirements and download the appropriate application for a Certificate of Title. Provide all documentation and fees stated.
- Submit the application to the DMV: Most states require you to appear in person at the local DMV to submit the Certificate of Title application.
- Update registration and insurance: After adding a new person to the title, they must be on the vehicle’s registration and insurance to legally drive it.
FAQ
Do You Need a Notary to Transfer a Vehicle Title?
Some states require a notary to witness the signing of a vehicle transfer, but not all do. Check your state’s requirements before signing your title.
Can You Take Your Ex off the Title if There is a Lien?
You can’t remove your ex from the car title if there is a lien. During the divorce court proceedings, the judge will decide who is responsible for paying off the loan or who must refinance the debt into their name. After removing your ex-spouse from the debt, you can remove them from the title.
If Two Names are On the Car Title, Who Owns the Car?
Both people named on the car title own the car. How you hold the title determines whether one person or both must approve a title transfer. If there is an ‘and’ between the names, both parties must approve any transactions involving the car.
If Two Names Are on a Car Title, Can One Person Sell It?
If there is an ‘or’ between the names on the car title, either person can sell it. However, if there is an ‘and,’ both people must sign the back of the title as ‘sellers’ for a title transfer.
How do I Remove a Second Car Owner from a Car Title in Texas?
To remove a second car owner from a car title in Texas, you must visit your local DMV, complete the title application, provide your identification, and pay the appropriate fee.
How do I Remove a Second Car Owner from a Car Title in Florida?
To remove a second car owner from a car title in Florida, you must complete the Application for Certificate of Motor Vehicle Title, provide your government-issued ID, and pay the $75.25 transfer fee.
How do I Remove a Second Car Owner from a Car Title in Illinois?
To remove a second car owner from a car title in Illinois, you must complete the Application for Corrected Title, sign the back of the title, and pay the appropriate fee.
Final Thoughts: How to Remove Someone From a Car Title
Knowing how to remove someone from a car title is important when you own a car with another person. Whether you are transferring the car between family members or to another person during a car sale, it’s important to know the steps required.
You may use your car title as collateral for a title loan, but understand who owns the title before you do. If two names are on the title, both people may have to approve the car financing. If you have questions about how this works, contact the professionals at Montana Capital today.
Written by
Samantha Hawrylack
Samantha Hawrylack writes for our company and is an expert in personal finance. Sam received her Bachelors of Science in Finance and her Masters in Business Administration from West Chester University of Pennsylvania. She began her career in the financial services industry and shifted to an entrepreneurial role where she could directly impact clients. Sam has an impressive background in personal finance and business management.