title assignment by seller

How to Sign an Assignment of Title by a Registered Owner

When you're ready to sell a car, sign the Assignment of Title by Registered Owner to get the buyer on his way to transferring the title into his name. Most states require the Assignment of Title -- which can be found on the back of your personal title -- as proof that the sale is legitimate. Signing the Assignment of Title by Registered Owner should take mere minutes. Once it's gone, your vehicle is as good as registered to someone else.

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Flip over your car title to find the Assignment of Title by Owner.

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Print your name, the date you're selling the vehicle and the price of the sale.

Fill in the odometer reading, if necessary. In Tennessee, for example, an odometer reading is only required on vehicles newer than 10 years.

Sign your name as the seller, where indicated.

Give the form to the buyer. She should fill out her name and address and then sign as the buyer.

Bring the Assignment of Title by Registered Owner to the office that issues new motor vehicle titles. In Virginia, for example, it's the Virginia Department of Motor Vehicles.

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How to Fill Out a Car Title Transfer

Last Updated: March 19, 2024 Fact Checked

This article was co-authored by Lahaina Araneta, JD . Lahaina Araneta, Esq. is an Immigration Attorney for Orange County, California with over 6 years of experience. She received her JD from Loyola Law School in 2012. In law school, she participated in the immigrant justice practicum and served as a volunteer with several nonprofit agencies. There are 11 references cited in this article, which can be found at the bottom of the page. This article has been fact-checked, ensuring the accuracy of any cited facts and confirming the authority of its sources. This article has been viewed 559,620 times.

If you are buying or selling a vehicle, you will need to pass ownership of the vehicle by filling out the title transfer. The rules vary from state to state, so it's important to find out the specific paperwork and regulations in your area before moving forward with the sale. In general, however, the steps are essentially the same.

Filling Out a Car Title as a Buyer

• Verify the buyer and seller’s names, the sale date, and VIN number are correct.
• Check the odometer of the car to ensure the mileage on the title is accurate.
• Search the VIN number on the DMV’s site to confirm there's no lien on the car. [1] X Research source
• Sign the title and get the Bill of Sale to transfer the title to you at the DMV.

Selling a Vehicle

• Your DMV should have an application you can complete for requesting a duplicate title. The application or form might be available online.
• You might not have the title because you haven’t paid off your car loan. In that situation, you need to work with your lender to pay off your loan before you will receive the title. Once paid, you can submit a lien clearance letter or other release form to the DMV to get the lien removed. [2] X Research source
• If the car has a lien, then the duplicate will probably be sent to the lienholder, so it is best to take care of the lien before making the sale.

• You can find your DMV online. Type “your state” and then “DMV.” Look for a link that explains transferring title.
• You can also find the specific rules and regulations in your state regarding title transfer here: https://www.dmv.org/title-transfers.php . Click on your state. This website isn’t affiliated with any state government. However, they provide links and contact information to state offices.

• names of the buyer and the seller
• notary’s signature (in some states) [3] X Research source
• date of sale
• Vehicle Identification Number (VIN)
• odometer reading (though in some states this is a separate form)

• If your state doesn’t have a form, you can create your own. It should contain a description of the vehicle, VIN, final sale price, place of sale, and the names of both buyer and seller.
• If the seller made any warranties, those should be included in the Bill of Sale as well. There will also be implied warranties if a written warranty was provided by the dealer when the car was sold. [5] X Trustworthy Source Federal Trade Commission Website with up-to-date information for consumers from the Federal Trade Commisson Go to source

• description of the vehicle, such as its make, model, year, and color
• date of the sale or title transfer
• license plate number
• odometer reading
• new owner’s name and contact information
• your name and contact information

Buying a Vehicle

• names of buyer and seller
• odometer number
• any other information necessary to the sale of the car

• Most liens are held by the bank that gave the seller their car loan. The car is used as collateral for the loan. In that situation, the bank probably has held onto the title and the only way the seller can get the title is to pay off the lien.
• However, a seller could have other liens on the car. Accordingly, don’t assume that there are no liens on the car simply because the seller has title. For example, a child support lien might have been placed on the car. Alternately, a mechanic could get a lien on the car for unpaid repairs. If you buy the vehicle with the lien on it, you now become responsible for the lien. [9] X Research source
• If you have the VIN, you can check for liens by visiting your local DMV or checking their website to see if it has a title check feature. If your DMV's website does have a title check feature, you can enter the VIN to see the title and lien information for the car. This is a critical step, so don’t neglect it.

• Ideally, you should go with the seller to the DMV office and fill out the transfer form together there. Even if not required by the state, going together can protect you because you can check for liens while you are there. [11] X Research source
• The DMV should also have a notary public in the office, in case your state requires that your signatures be notarized.

• You’ll also need the VIN and current odometer reading, which should be on the title form. In some states, the odometer reading will be written on a different form.

• You typically must pay a fee for the title transfer, which will vary by state.
• You must turn over the title. Your state should send you a new title in the mail.

• proof of insurance
• proof that you’ve paid sales tax
• certificates showing the car has passed safety and emissions inspections

Expert Q&A

• If you ever have questions about the process, contact your local DMV. They can give you the correct information you need. Thanks Helpful 0 Not Helpful 0

You Might Also Like

• ↑ https://www.txdmv.gov/motorists/buying-or-selling-a-vehicle/title-check-look-before-you-buy
• ↑ https://dmv.ny.gov/titles/how-remove-lienholder-title
• ↑ https://www.dmv.org/az-arizona/title-transfers.php
• ↑ https://www.dmv.org/bill-of-sale-form.php
• ↑ https://www.consumer.ftc.gov/articles/0055-buying-used-car
• ↑ https://www.dmv.ca.gov/portal/vehicle-registration/titles/title-transfers-and-changes/notice-of-transfer-and-release-of-liability-nrl/
• ↑ https://dmv.ny.gov/registration/how-check-title-or-lien-status
• ↑ https://www.nj.gov/mvc/vehicles/transowner.htm
• ↑ https://www.dmv.ca.gov/portal/dmv-virtual-office/title-transfers/
• ↑ https://www.txdmv.gov/motorists/buying-or-selling-a-vehicle

About This Article

To fill out a car title transfer when selling your vehicle, make sure you have the title or apply for a duplicate from the DMV. Once you secure the title, fill out the transfer form, including the names of the buyers and sellers, date of sale, price, vehicle identification number, and odometer reading. After you finish the paperwork, get all of the necessary signatures. Depending on the specific rules in your state, you might need to have your paperwork notarized and include a Bill of Sale. When you’ve completed your state’s requirements, which you can verify on the DMV website, submit the Notice of Transfer or Release of Liability to the DMV to protect you in case the new owner gets into an accident before the paperwork is processed. To learn how to fill out a car title transfer when buying a vehicle, keep reading! Did this summary help you? Yes No

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Title Transfers in South Carolina

• Complete and sign the title certificate (seller and buyer).
• Complete a Bill of Sale (if applicable).
• Complete the title application form.
• Submit the above to the SCDMV.

Read below for more details on how to complete a South Carolina car title transfer.

How to Complete New-to-State Title Transfer in South Carolina

After moving to South Carolina, you have 45 days to complete a car title transfer with the SC Department of Motor Vehicles (DMV).

To apply for a South Carolina vehicle title, submit the following to the DMV:

• A completed Application for Certificate of Title and Registration for Motor Vehicle or Manufactured Home/Mobile Home (Form 400).
• The out-of-state title and registration certificates.
• Check out the DMV's list of acceptable forms of ID .
• Proof of paid vehicle property tax .
• Proof of South Carolina car insurance .
• Payment for the auto title transfer fee .
• Payment for the $250 Infrastructure Maintenance Fee. 

You can submit the above:

• In person at your local SCDMV office location .
• Department of Motor Vehicles
• P.O. Box 1498
• Blythewood, SC 29016

NOTE : Unless you are not planning on driving your vehicle, you will also need to register your car , which can typically be done along with titling. Read our guide to Car Registration in South Carolina for more information. 

Transfer Title when Buying or Selling a Car

Once you have purchased a car, you have 45 days to apply for a DMV title transfer and register it. The process will differ slightly based on whether your new car was:

• Bought from a dealer.
• Bought from a private seller.

Buying from a Dealer

When you purchase a non-leased car from a dealership, the dealer is required to complete your vehicle title and registration application for you.

The dealer will collect any applicable sales tax and titling fees .

Leased Vehicles

If you've leased your new car, bring following to the DMV for a vehicle title transfer:

• Section E (Leasing Information) must be completed by your leasing company.
• The odometer reading must also be filled out.
• Properly assigned title or Manufacturer's Certificate of Origin .
• Proof of South Carolina auto insurance .
• Power of attorney , if you are signing on behalf of someone else.
• Vehicle property tax receipt .
• Payment for any applicable title fees and taxes .

Buying from a Private Seller

If you've purchased a car from a private seller and are ready to transfer ownership, head to your local DMV office with:

• The current title certificate signed over to you by the previous owner.
• Bill of Sale   IF the original title was issued BEFORE June 19, 1989.
• Lien information (if applicable).
• The Department of Motor Vehicles provides a list of acceptable documents .
• A Power of Attorney , if you're signing on behalf of someone else.
• Receipt for paid vehicle property tax .
• Payment for any applicable title transfer fees and taxes .

NOTE : All cars must display a license plate while being driven on South Carolina's public roads. You can get a temporary license plate to display before you title and register your car. Read our Car Registration in South Carolina page for more information.

Vehicles Without a Title

If you purchase a car that has no previous South Carolina title , you can apply for one by submitting the following to the DMV:

• Current owner information .
• A statement regarding how, when, where, from whom the car was acquired, and the condition of the vehicle.
• Pictures of the car from all angles.
• If no identification number is available, you must apply for a DMV-issued serial number by completing an Application for Special Serial Number (Form 401-A) BEFORE beginning the title application process.
• If your car is inoperable , you can have it branded not for road use". You can have this brand removed once the car is running.

Selling a Vehicle in South Carolina

When you sell a car , it is the buyer's responsibility to complete the vehicle title transfer. However, as the seller you must:

• Complete the title assignment on the title certificate.
• Provide a Bill of Sale  if the title was issued before June 19, 1989.
• Submit a completed Notice of Vehicle Sold (Form 416) to the DMV.

How to Transfer the Title for Gifted and Inherited Cars

Gifted vehicles.

The process for completing a South Carolina DMV title transfer for gifted vehicles is similar to the buying and selling process . Be sure to mark The Vehicle was a Bonafide Gift" box, as this will qualify the vehicle for a sales tax exemption.

You may also be exempt from sales tax if you are transferring vehicle ownership between family members. See Title Transfer Fees below for a full list.

Inherited Vehicles

If you are a surviving owner of a car, and your name and the deceased's name is separated by or " on the title, you can sign as the sole owner for an auto title transfer.

If the names on the title were separated by and ", or if there was only one owner on the title, distribution of the vehicle must be determined by the probate court .

Depending on the determined form of distribution, the court will issue one of the following:

• An Affidavit for Collection of Personal Property Pursuant to Small Estate Proceedings .
• Personal Representative with an original Certificate of Appointment .
• Probate Court Order .

To complete a South Carolina car title transfer, you will need one of the above documents, along with the Application for Certificate of Title and Registration for Motor Vehicle or Manufactured Home/Mobile Home (Form 400).

Releasing a SC Lien

Once you have paid off your car loan , your lender can release the lien on your SC vehicle title, allowing you to complete an auto title transfer.

Your lender can release the lien:

• Electronically , if there is an electronic title.
• By completing the lien release section on the title certificate.
• Your (owner's) name.
• Vehicle identification number (VIN).
• Title number.
• A signature of an authorized company representative.

Title Transfer Fees

The titling, sales tax, and car title transfer fees in South Carolina are:

• Original title : $15.
• Title transfer : $15.
• Infrastructure Maintenance Fee : 5% of purchase price ($500 maximum).

Infrastructure Maintenance Fee Exemptions

In addition to gifted and inherited cars, you will also be exempt from South Carolina IMF if:

• Grandparents.
• Grandchildren.
• You are a non-resident member of the military .

Duplicate South Carolina Title

Because vehicle ownership cannot be transferred without a title, it is important that you get a duplicate title if you lose your original title certificate.

To order a replacement SC title, submit the following to your local DMV office :

• Please see the Department of Motor Vehicles' list of acceptable documents .
• Payment for the vehicle title fee .

This form is provided by your state's agency/department.

Please select one of the below to continue:

Email this form to yourself and complete it on your computer.

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Please check your inbox (including spam box).

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How to Complete a Title Assignment

The information here can be used to assist buyers and sellers with the assignment by owner area on the back of the current Colorado Certificate of Title. Older versions, or titles from other states have different formats and may vary from what’s shown here. If you’re unsure of how to complete the title assignment, please contact our office for guidance. Errors made on this document can cause long delays and in some situations, a duplicate title may be required.

Information for each area above is represented by the corresponding numbers below:

If the vehicle has an odometer, enter the number of miles shown from the odometer in this area. Readings in kilometers should be converted to miles. Complete this box carefully. Any changes, alterations, or corrections in this box can void the document and a duplicate may be required. 

Mark one selection only:

• Actual Mileage - This is the most common selection. It’s used when the odometer is working correctly and is displaying the correct mileage.
• Mileage in excess of mechanical limits - This is less common but was used more in the past when odometers contained only 5 digits.
• Not Actual - Warning: Odometer Discrepancy - Select this box if the odometer does not show the actual mileage on the vehicle. This might occur if the odometer is broken or was replaced.

Each current owner/seller must print and sign their name exactly as it is shown on the front side of the title document.

Enter the date here that the vehicle was sold.

Enter the price here, in US dollars, that the vehicle was sold/purchased for. If it was a gift, it’s okay to write the word gift here.

The buyer must print and sign their name here. The name should be listed exactly as it is shown on their identification . 

If there is more than one buyer, print the additional buyer names here. A signature for the additional buyers is not required.     

This is the legal address of the buyer. The vehicle must be registered in the same county that the buyer lives in.  If a separate address is used to receive mail, please do not list it here. The mailing address will be provided later in the process.  

Note: If you have an emergency , please call 911 . If you need to report a crime or ask a police related question, please call the Larimer County Sheriff's Office at 970-416-1985 .

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Ultimate Guide to Transferring Your Vehicle Title at the Utah DMV

January 04, 2021 • 1 min read

UTAH TITLE TRANSFER

Here's the ultimate guide to transferring your vehicle title at the Utah DMV. We've simplified the entire process to save you time.

What You’ll Need to Transfer your Vehicle Title in Utah

• Current title certificate, properly assigned to you by the previous owner. If the title is lost, the title assignment can be made on the Application for Utah Duplicate Title (Form TC-123).
• A completed Bill of Sale (Form TC-843) that includes the following:
• Buyer/seller names, addresses, and signatures.
• Vehicle description and VIN.
• Purchase date and price.
• Trade-in description and allowance, if applicable.
• A completed Vehicle Application for Utah Title (Form TC-656).
• Completed Odometer Disclosure Statement (Form TC-891) if the car is less than 10 years old.
• If the car is being leased, submit the following from the lessor: Power of attorney,  Billing statement, Utah sales tax number.
• Safety and/or emissions inspection certificates (if applicable).
• Payment for title transfer fees and sales tax.

For out of state transfers..

• Certificate of Title.
• Application for Utah Title. (Form TC-656) .
• Safety and/or Emissions Inspection Certificates.
• VIN/HIN Inspection.

What You’ll Need to Do to Transfer your Vehicle Title in Utah

• Complete the title assignment on the title certificate, and provide bill of sale and odometer disclosure (if applicable).
• Complete vehicle title application form.
• Provide proof of vehicle safety/emissions inspection.
• Visit any DMV office near you. Consider making a DMV appointment or getting a line waiting concierge .
• Submit the required documents, your application, and pay for the title fee.

Need more Utah DMV help?

Search the Skip blog or download the free Skip app on the App Store or Google Play . On the app, you can find more help, book services, and even ask our team questions via chat.

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This is How to Sign or Transfer Your Title in Connecticut

We Buy Cars and Trucks for Cash and Our Offers are Guaranteed.

How to Sign Your Title in Connecticut (CT)

Where to sign view title image.

• Back of the title - sign name(s) in the box where it reads "Signature(s) of Seller(s)."
• Back of the title right next to where you signed your name(s) - print name(s) where it reads "Printed Name(s) of Seller(s)."

Multiple Owners

Only one owner must sign if title states "OR" between owner names printed on the front of the title. Both owners must sign if title states "AND" or "AND/OR" between owner names, or if nothing is listed between owner names.

Lien or Bank Name on Title

If your Connecticut title shows a lien or a bank name printed on the front, then your title will need to be signed off by the lien holder or have a separate lien release letter.

Duplicate Time In Person

Duplicate time mail, duplicate cost, connecticut dmv.

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How to fill out a title when selling a car.

Your car’s title establishes legal ownership over the vehicle, making it one of the most important documents associated with your vehicle. When you’re buying or selling a car in a private sale, the title information must be filled in correctly to transfer ownership from the seller to the buyer. Mistakes could cause lengthy delays with your state’s Department of Motor Vehicles (DMV), which could possibly impact the sale. Let’s learn more about how to fill out a title when selling a car so you can hopefully avoid that happening to you.

How to sign over a car title

When you’re selling your car, you’ll need to release your ownership of the vehicle by signing over the title. In a private sale (instead of a sale to a dealership or retailer), the buyer will then take it to a local DMV to register the vehicle under their name. If the buyer is from another state , they may have to first obtain a temporary registration from the seller’s state before ultimately registering the vehicle with their home state’s DMV. Here are a few other steps to consider when signing over a car title:

Check on and resolve any liens

Most car owners have to take out a loan to purchase their car. If those loans are not paid off, these cars are subject to a lien — a legal claim to the vehicle held by the lender in case the owner doesn’t make their payments.

To help facilitate a smooth sale for cars with liens, it can be helpful to contact your lender as soon as you can to see how to proceed. In most cases, the loan will need to be paid off (possibly with cash generated from the private sale) before the title is clear to hand off to the new owner.

Write a bill of sale

Along with the title, you’ll also need to create a bill of sale, with the seller and buyer each receiving a copy for their records. The DMV may also wish to see this depending on your state’s regulations. A bill of sale typically includes the amount paid, date of transaction and signatures of both parties.

Sign the right names in the right places

This may seem like kind of an obvious tip, but it’s important to make sure you sign the right name. If you had a name change for any reason (for instance, because of a marriage) since the title was issued, you’ll need to sign with the original name used on the title.

Additionally, titles often feature multiple blank lines for signatures. Placing your signature on the wrong line could stall the process at the DMV. Depending on your state, you may be required to file a correction form or possibly even a new title altogether.

Things to look out for

There are a few other details of the process that you may want to look out for as well:

Check on state-specific DMV regulations

DMV regulations and requirements for title transfers can vary significantly from state to state. Some states require a bill of sale to be presented, while others require an inspection of the car. It can be helpful to check on specific local requirements with your state’s DMV prior to proceeding with a sale.

Using the right color of ink

This may seem a little antiquated in the digital age, but the choice of ink you use can also be important. Black or blue ink is preferred, as these hold up better over time. Blue ink has the added advantage of making it easier to identify originals vs. photocopies.

While we’re on the subject of ink, if you happen to make a mistake somewhere, it’s imperative that you don’t use correction fluid or tape to cover it. This could result in your title becoming void. Contact the DMV instead to find out how to proceed.

How to sign a title with two owners

Sometimes a car has more than one owner listed on the title. In these cases, signing over a car title may or may not require each owner’s signature, depending on how the two names are separated on the document. If the owners are listed with an “and” (for example, Jack and Jill), both signatures may be needed. If the owners are listed with an “or” (Jack or Jill), then either owner’s signature may suffice. However, states may have their own rules on the signatures of multiple car owners. It may be helpful to check with your local DMV on this detail.

Steps for buyers

Although signing over a car title is largely carried out by the seller, there are some things prospective buyers can do on their end to help facilitate a smooth sale.

Verify the vehicle identification number (VIN)

The car’s VIN (often located on the driver’s side windshield) must match the one listed on the title. If it doesn’t, you may have trouble trying to register the car in your name.

Double-check the odometer reading

Federal law requires car sellers to write the cumulative mileage registered on the odometer on the title when transferring ownership. If the odometer reading is inaccurate, the seller must indicate this discrepancy, either on the title or on a disclosure form. An odometer that doesn’t match the true mileage of the car could indicate the vehicle has been tampered with and may be a red flag.

Note on title transfers when buying from a retailer

One of the major advantages of buying from a dealership or online retailer , rather than a private seller, is that they often will help fill out the paperwork on your behalf. This may include title transfers and DMV registration.

A car sale becomes official when the title is transferred over to the new owner. For that reason, it’s generally helpful to know how to fill out a title when selling a car so that you can sidestep potential delays. As you see, it’s not actually a difficult process — it just requires a little extra attention.

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Ohio Vehicle Title Transfer: Assigning Ownership From Seller To Buyer

• August 9, 2021
• If you buy a vehicle from a car dealership, then most likely its the F & I department that will process the title transfer
• If you purchase a car from a private seller, you can process the Ohio title transfer online
• As a car buyer, you must pay Ohio state sales tax county, and fees
• If you can't find original OH title when it's time to sell your vehicle, you can apply for a title replacement online

If you buy a vehicle from a car dealership, then most likely its F & I department will process all the paperwork needed to transfer you the title. They’ll apply for a certificate of title on your behalf, include the appropriate Ohio sales tax county, and fees.

Use eTags © to Quickly Complete Your DMV Service. Renewals, Title Transfers and More, All Online!

You have 30 days from the date of sale to transfer a vehicle title in Ohio

No separate title application needed But if you’re purchasing a car from a private seller, you need to handle the transfer of ownership on your own. As a seller, he/she needs to complete the assignment of ownership portion on the back of the Ohio title and sign. With the seller’s signature on the back of the title, you the buyer are exempted from having to separately complete an application for certificate of title.

If there’s a lien holder on the vehicle, it must be noted in the assignment of ownership portion on the back of the title

Ohio title transfers online eTags now offers Ohio title transfers online, so there’s no more need to visit your County Clerk of Courts Title Office to complete the transfer of ownership. eTags also offers registration services, so you can skip the trip to your Deputy Registrar License Agency for your tags. If you choose to transfer your Ohio vehicle title online, make sure your title is signed by the seller and you(the buyer)  and that it’s notarized. SEE ALSO: OHIO VEHICLE REGISTRATION; HOW TO RENEW OH TAGS

When transferring an Ohio title, the buyer pays sales and use tax on the purchase price of the vehicle

The eTags app allows you to just click through a few fields, answer a few questions upload documents needed and your order is complete. There’s no appointment needed, and no waiting in line.

Ohio title replacement if your title is lost eTags also processed duplicate titles for Ohio drivers . So if you’re looking to sell your used vehicle, but can’t find your original title, you can order a title replacement online. Once you get the duplicate title by mail, you can use it to sell your vehicle and transfer the ownership to the new buyer.

In Ohio, all-purpose vehicles (aka ATV vehicles) and off-highway motorcycles are titled

Transferring an Ohio title to a surviving spouse If a married Ohio resident owned at least one vehicle at time of death, the surviving spouse can transfer vehicles valued up to $65,000. An original Ohio title number is needed and a certified copy of the death certificate. You must also sign a Surviving Spouse Affidavit form BMV 3773. On that form you’ll list the vehicle make, model, year, body type, VIN number , and value. If there’s a lien holder on the title, it will be carried over when transferred.

Should you need to register the vehicle after you transfer ownership, you can process the paperwork online with eTags.

Related Topics

• ohio title transfer
• vehicle title
• vehicle title transfer

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I bought a car from a private seller got the title notarized but never completed the process. The person who sold the car to me filed for a lost title and got it retitled in their name is this legal? I still have the notarized title.

If you still have the notarized title then it was never assigned to you. What the seller did is not legal and you could take the signed/notarized title to the police/DMV and see if they can help out.

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All persons who will be shown as owner on a vehicle's new title must sign the title application. If you or your spouse cannot appear together at a Secretary of State office to sign, either may appoint the other to sign on their behalf by completing the Department's Appointment of Agent form . The person who cannot appear completes the form appointing another person to sign on their behalf. The completed form is submitted with the title application.

In addition to the $15 title fee, there is an extra $5 fee for instant title service. The vehicle owner must appear in person for instant title service. The owner cannot appoint an agent for an instant title transaction. If there are two owners of a vehicle, both owners must appear in person for instant title service.

NOTE:  For duplicate title transactions when there are two owners on the title record, only one owner needs to appear and sign the title application. An appointment of agent is not needed from the other owner. Both owner names will appear on the duplicate title. 

Every instant title application is unique, but all persons processing a title application must present a Michigan or out-of-state photo driver license or ID card. Also, the vehicle identification number or hull identification number (for watercraft) is required for every instant title application.

Please check with our Information Center at 1-888-SOS-MICH  (1-888-767-6424) to make sure you have all the correct paperwork before traveling to an instant title branch office.

Most title transactions involving a Michigan title are eligible for instant title service at all Secretary of State branch offices. Certain title transactions are NOT eligible for instant title service. 

Upon sale of a vehicle, the title record for the vehicle will remain in the seller's name until the buyer submits the seller's assigned title and applies for title in their (the buyer's) name. The best way to ensure this happens is for the seller to accompany the buyer to a Secretary of State branch office and process a title transfer application into the buyer's name.

Sellers run a risk if they do not ensure the buyer applies for title. The Michigan Department of State cannot change the name on a title record until a new title application from the purchaser is processed. If you cannot accompany your purchaser to a branch office to ensure the title is transferred, make a copy of the front and back of the title after assigning it to your buyer. This will protect you against negligent use of the vehicle after delivering it to the buyer as provided in Section 257.240 of the Michigan Vehicle Code:

1) The owner of a motor vehicle who has made a bona fide sale by transfer of his or her title or interest and who has delivered possession of the vehicle and the certificate of title to that vehicle properly endorsed to the purchaser or transferee is not liable for any damages or a violation of law that subsequently results from the use or ownership of the vehicle by another, if the owner, other than a licensed dealer, satisfies the conditions prescribed under subsection (2).

(2) The owner of a motor vehicle, other than a licensed dealer, shall satisfy 1 of the following conditions:

(a) Accompany the purchaser of the vehicle to a secretary of state branch office to assure that the title of the vehicle being sold is transferred.

(b) Maintain a record of the sale for not less than 18 months. As used in this subdivision, "record of the sale" means either a photocopy of the reassigned title or a form or document that includes the name, address, driver license number, and signature of the person to whom the vehicle is sold and the purchase price and date of sale of the vehicle.

No - immediately remove your plate upon selling the vehicle. You can transfer the plate to another vehicle you own or purchase. Do not let a buyer "borrow" your plate, as any violations (including parking tickets) issued to the buyer with your plate on the vehicle will be your responsibility. Under Michigan law, a person who buys a vehicle through a private sale may drive the vehicle home using the most direct route without a license plate. The buyer must do so within three days of purchase and carry the assigned title and proof of insurance during transit.

Yes. A person who cannot prove they sold their vehicle as required by Section 257.240 is responsible for a civil infraction and subject to a civil fine of $15.00. The person is also presumed to be the last titled owner and is liable for towing fees and daily storage fees if the vehicle is abandoned.

If you cannot locate the previous owner, it will be necessary to get:

A Court Order - A court order awarding ownership of a vehicle can be used if the order includes the year, make, and vehicle identification number (VIN) of the vehicle; or  

  A Surety Bond  - Without a court order, you must obtain a surety bond.  A surety bond is like an insurance policy, and is purchased by the applicant from an insurance company or bonding agency.  It must be for twice the fair market value of the vehicle ("fair market value" can be established by a dealer appraisal or a recognized vehicle appraisal guide).  The bond is posted for three years and is returned if no claims are filed during the three-year period, or  

As a last resort when a Michigan vehicle title has been lost, destroyed, or stolen and the purchaser is unable to contact the previous owner for a duplicate title, a Michigan resident can self-certify ownership at a Secretary of State branch office if the vehicle is ten or more years old and valued at $2,500 or less. The self-certification procedure cannot be used for vehicles titled in another state or by nonresidents.

           You will need to submit:

a) A completed TR-205 Certification of Ownership (available on-line at all Secretary of State offices) stating you are the rightful owner of the vehicle and including the vehicle description, the true value of the vehicle, and a complete explanation of how, when, where, and from whom the vehicle was acquired; and

b) Either of the following:

• A vehicle value appraisal completed by a licensed Michigan dealer, or
• A page printed from an on-line appraisal service such as Kelly Blue Book, N.A.D.A. Guides, Edmunds, etc.  (www.kbb.com, www.nadaguides.com, www.edmunds.com).

On-line appraisal sites may provide multiple vehicle values (wholesale value, trade-in value, and retail value).  Any of these values showing a value of $2,500 or less may be accepted.

Yes - under Michigan tax law, relationships that qualify for tax exempt status are limited to vehicles purchased or acquired from a spouse, father, mother, child, brother, half-brother, sister, half-sister, grandparent, grandchild, legal ward, or legally-appointed guardian. Included are stepparents, stepbrothers, stepsisters, stepchildren, father-in-law, mother-in-law, brother-in-law, sister-in-law, son-in-law, daughter-in-law, and grandchild-in-law. All other relationships (cousins, aunts, uncles, nephews, nieces, step-grandparents, great-grandchildren, grandparent-in-law, etc.) are not tax exempt.

Owners may elect to follow a two-step title transfer process in which a tax exempt relationship applies. For example, your uncle could transfer the vehicle to his brother (your father), which would be tax exempt. Once the vehicle is re-titled in your father's name, he can transfer the title to you which would be tax exempt.

Submit your out-of-state title at a Secretary of State branch office. If more than one owner shows on the out-of- state title, all owners must be present, or the one present must have an Appointment of Agent form to sign for the other owner. Proof of valid Michigan no-fault insurance must be presented to purchase a Michigan license plate. 

If your out-of-state title is being held by a lien holder, you may take your out-of-state registration (expired less than 90 days) or proof of the out-of-state title to any Secretary of State branch office along with proof of Michigan no-fault insurance for the vehicle. Michigan will issue a "FOREIGN OWNERSHIP-REGISTRATION ONLY" registration for the vehicle. A Michigan title is not issued. The out-of-state title remains the ownership document.

Take your out-of-state registration (expired less than 90 days) or proof of the out-of-state title to any Secretary of State branch office along with proof of Michigan no-fault insurance for the vehicle.  Proof of your out-of-state title can be a fax copy or photocopy of the title, a memo title, a recently validated title application, or a vehicle record printed on the issuing state's Department of Motor Vehicles letterhead verifying the vehicle is titled in that state.

Michigan will issue a "FOREIGN OWNERSHIP-REGISTRATION ONLY" registration for the vehicle. A Michigan title is not issued. The out-of-state title remains the ownership document.

No. There is no such thing as a "three-day cooling off period" or any other time period during which you can return the vehicle. Your sales contract is binding.

When should I receive the new title for the vehicle I bought?

• You should receive an original title in the mail in about 14 days. Make sure the information on the title is accurate and report errors to your local Secretary of State office.
• Keep your title in a safe place. Do not store it in your vehicle.

Only under extenuating circumstances can the application be faxed to an out-of-state customer. This is because original documents with original signatures are needed. If the application is faxed to the customer, the application still needs to be returned by mail so that original signatures are on the application.

A list of currently licensed or registered dealers and repair facilities can be found on the Secretary of State's Web site at Vehicle Dealer and Repair Facility Lists. The lists are organized by county in alphabetical order by name and are updated on a daily basis.

If you are unable to locate the motor vehicle dealer or repair facility you are searching for, please call the Customer Support Section at 1-888-SOS-MICH (1-888-767-6424) for assistance.

If you have a complaint, try to work it out with the dealership owner or manager.  If the problem isn't resolved, contact the Department of State's Regulatory Monitoring Division at 1-888-SOS-MICH (888-767-6424). An automotive complaint form is available on the Department of State Web site. The bureau investigates issues within its authority. 

If the deceased owner's estate is not probated, the surviving spouse may transfer that vehicle into their name. Present the title, the current registration or license plate number (if there is one), and a certified copy of the death certificate to a Secretary of State branch office. The surviving spouse will complete a TR-29 Certification From the Heir to a Vehicle form .

If the estate is being probated, the personal representative appointed by Probate Court must assign the title to the surviving spouse. The spouse presents the assigned title and a copy of the personal representative's Letter of Authority document to apply for a title in their name at a Secretary of State branch office.

If the current title is in both your name and the deceased's name with the legend "Full Rights To Survivor" printed on it, then all that is needed to transfer the vehicle into just your name is the title and a copy of the death certificate.

The mileage on a title may be corrected by obtaining an amended odometer statement from the seller who incorrectly reported the mileage in the first place. A corrected title application can then be processed at any Secretary of State branch office. If the Department of State made the error, the title and a certification of what the error is can be taken to any Secretary of State branch office. The branch will mail in the title with the certification for correction.

You may request this information online by selecting the Record Sales Services link under the Additional Services section and then selecting "Request Records" or by mail. There is an $15 fee for each record, $16 if certified. All fees must be prepaid. You may download a Michigan Department of State Record Lookup Request form . Mail the request with a check or money order made payable to the "State of Michigan" to:

Michigan Department of State Record Sales Section 7064 Crowner Drive Lansing, MI  48918-1540

The Department of State has a list of Salvage Inspectors by County. To find a resource near you, you may use  Online Services .

Follow the link and select Salvage Vehicle Inspector under Additional Services.  You may also contact our Information Center at 1-888-SOS-MICH (1-888-767-6424) for the names of inspectors in your county.

If the vehicle was manufactured for sale in the United States, you will need the proper ownership documents, a stamped U.S. Customs and Border Protection "Entry Summary" CPB 7501 form , proof of Michigan no-fault insurance, and identification to title and register the vehicle in Michigan.

If the vehicle was not manufactured for sale in the United States, you will then need the following compliance documents:

• Ownership documents
• Stamped U.S. Customs and Border Protection "Entry Summary" CBP 7501 form   - This form will have the vehicle identification number listed and a brief description of the vehicle.  Also, read the note that follows. 
• U.S. Department of Transportation HS-7 form  - If box 3 is checked, this indicates the vehicle wasn't manufactured to U.S. standards.  A registered importer must assist with importing the vehicle.  The importer provides the federal government with a statement of conformity to document what steps were taken to modify the vehicle to U.S. standards. The federal government reviews the statement of conformity and provides the importer with a bond release letter.  Both the HS-7 form and bond release letter are then submitted with the title application.  If 30 days have passed since the statement of conformity was submitted to the federal government, the statement of conformity can be accepted in lieu of the bond release letter.
• TR-54 Inspection Form  - This is required only if the vehicle was imported through a state other than Michigan  and  the vehicle is being titled but not registered (if the vehicle is being registered, this form isn't required).
• Proof of insurance

Note about the CBP 7501 form : The CBP 7501 is required for on-road vehicles, mopeds, trailers, trailer coaches, ORVs, watercraft and snowmobiles.  The form doesn't need a stamp or seal for vehicles that are at least 25 years old, ORVs, watercraft and snowmobiles.

Note about the HS-7 form : If box 3 is checked on the HS-7 form, this indicates the vehicle wasn't manufactured to conform with U.S. safety and emissions standards. A registered importer must assist with the importation process (this is required by federal law).  The registered importer provides the federal government with a statement of conformity that documents what steps were taken to modify the vehicle to meet U.S. standards.  The federal government reviews the documentation and provides the importer with a bond release letter.  The bond release letter is submitted with the HS-7 form.  However, if 30 days have passed since the documentation was submitted to the federal government, the statement of conformity may be accepted in lieu of the bond release letter.  

The registered importer ensures the vehicle has proper ownership documents, meets all federal EPA emission standards and DOT safety standards, converts the odometer reading to miles, and ensures any custom duties are paid.

Every motor vehicle, trailer coach, and trailer driven or moved on public roads must be title and registered. Under Michigan law the following vehicles are exempt from titling and registering:

Passenger vehicles registered in another state operated by a nonresident for up to 90 days (new residents must title and register their vehicles immediately).

An implement of husbandry (farm tractors and equipment).

Any vehicle owned by the United States government.

A trailer weighing less than 2,500 pounds is exempt from titling but must be registered (a title may be issued on request). All trailer coaches must be titled and registered.

A vehicle driven or moved upon the highway using the most direct route (round trip) for the purpose of:

obtaining a weight receipt from a weigh master,

obtaining a physical inspection from a law enforcement agency, or

obtaining a salvage recertification inspection.

A moped is exempt from titling, but must be registered.

To determine whether a title is electronic, log into your e-Services account, navigate to the “Ownership Account” springboard and select the “Title or Liens” sub-tab.

Yes, branded titles can be electronic. There is no change in the process for re-branding a title. The title transaction will be processed at a Secretary of State office with all the required documentation attached to the record. If the ownership on the re-branded title is also changing, the lienholder must release the lien before the title transfer can occur, which results in the printing of a paper title. If the ownership of the on the re-branded title isn’t changing, the title will remain electronic.

There is no change in the procedures for correcting a title. If an electronic lien was added in error, the lienholder can request to delete it electronically.

Dealers who use CVR will continue to use CVR for most transactions. When taking assumption of a lien, dealers will need to log into e-Services to complete the transaction.

Contact the Michigan Electronic Filing System (MiEFS) unit at [email protected]

Financial institutions and lienholders can access ELT either through e-Services or an approved service provider.

The ELT program is only for financial institutions. Titles that have an individual named as a lienholder will continue to be issued as a paper title.

ELT is mandatory for financial institutions; however, they are not required to participate until October 1, 2023.

Electronic liens must be released electronically by the lienholder. Lien releases are required for paper titles and can’t be used to remove electronic liens. Once all electronic liens have been released on an electronic title, the updated title will be printed and mailed to the customer.

Anytime an electronic lien is added, a lienholder ID must be provided. It is the responsibility of the lienholder to supply this number to vehicle dealer or customer when approving a loans. The lienholder ID can be found on the RD-108 or TR-11.

Select "no" for an electronic lien if a lienholder ID isn’t presented to the clerk or dealership. Because financial institutions aren’t required to sign up for the ELT program, not all liens issued will be electronic.

No. Financial institutions aren’t required to enroll in ELT and therefore, there isn’t anything in state law requiring all titles to be held electronically. Paper titles and special mailers will still be used if a lienholder ID isn’t entered. All titles issued before the ELT program started will remain as paper titles even after a lienholder enrolls in ELT.

Any non-electronic liens attached to an electronic title may be released at a Secretary of State office once the customer provides the appropriate paperwork documenting that the lien is fully paid. Electronic liens can only be released electronically by the lienholder. Once an electronic title is cleared of all liens, electronic and paper, the Michigan Department of State will print and mail the updated title to the customer. A $1 lien filing fee will still be charged when adding or releasing a lien.

No, you don’t need to visit an office to add or remove a lienholder from a title held electronically. Lienholders and financial institutions participating in ELT are required to electronically release liens or add liens when refinancing. Once all electronic liens are cleared from an electronic title, the Michigan Department of State will print and mail the updated title to the customer.

Yes, to verify the validity of your electronically stored title, request a vehicle registration record. Your lienholder will also have the option to request a paper title when you leave Michigan and register your vehicle in another state.

When a vehicle owner dies, vehicle ownership is inherited according to the following list:

• If the deceased's estate is probated, the person to whom the title is assigned. The Personal Representative (executor or administrator of the estate) is appointed by Probate Court and is responsible for assigning the deceased's title to the new owner.
• If the estate is not probated, the vehicle will go to the legal next-of kin, as follows:
• The surviving spouse of the deceased
• If no spouse, then equally to all descendants (children)
• If no spouse or descendant, then equally to both parents or to the surviving parent
• If no spouse, descendant, or parent, then equally to the descendants of the parents (siblings)
• If none of the previously listed, then closest next-of-kin

The surviving next-of-kin may either title the vehicle or reassign their interest in the vehicle without first obtaining a title in their name. If the deceased's title is lost, the next-of-kin must either title the vehicle in their name, or complete a duplicate/transfer title request at a Secretary of State office.  If ownership is shared equally among next-of-kin (i.e.: multiple children), each presumed owner must sign the title and share ownership, unless they sign a certification statement declaring that they aren’t interested in assuming ownership.  A will isn’t used to determine inheritance unless it is administered by probate court. Then the personal representative carries out the provisions of the will. Questions about rights or interest of next-of-kin should be referred to an attorney or probate court. Additionally, sales tax isn’t collected at the time of transferring the vehicle to a probated owner or legal next-of-kin. 

  Buying, selling, or leasing a vehicle

Title information  

Title transfer and vehicle registration

A complaint form must be filled out by the consumer and submitted to the Lansing Inspections Section, along with all supporting documentation. You may obtain this complaint form by using the online automotive complaint form or by calling 1-888-SOS-MICH (1-888-767-6424). If a complaint kit is mailed to you, you may submit the completed form and all supporting documents via fax 517-335-3192 or by mail to:

Michigan Department of State Regulatory Monitoring Division PO Box 30046 Lansing, MI 48909-7546

According to the Michigan Vehicle Code, a vehicle owner is required to register their vehicle in Michigan after staying in the state for 90 days. It is not necessary to title the vehicle in Michigan, however in order to comply with Michigan law, a Michigan certificate of no-fault insurance must be obtained in order to register your vehicle with the Michigan Secretary of State. If your out-of-state title is being held by a lien holder or leasing company, you may take your previous state registration (expired less than 90 days) or proof of your out-of-state title to any Secretary of State office. The Secretary of State will issue a Michigan registration and plate to a vehicle with an out-of-state title.  For a list of insurance companies authorized to issue Michigan no-fault insurance, please visit the DIFS website at: www.michigan.gov/difs .

Yes, but only if you drive the vehicle directly to the first place of storage (usually your home) within three days of the sale. You must have the properly assigned title and proof of insurance with you.

Do not use the seller's license plate on the vehicle while driving it home. The seller should keep the license plate. 

Apply for title at any Secretary of State office.

Congratulations on owning your vehicle free and clear. Now that your loan is paid off, you should receive a "letter of lien release" from the bank or financial institution that financed your vehicle. This letter will include the Vehicle Identification Number (VIN) and state that the terms of the loan have been satisfied. The bank or financing company also may use a "bank stamp" and sign the face of the title to show that the loan has been paid and the lien agreement is terminated. In either case, you may choose to purchase a new title with the lienholder removed or keep the lienholder's letter with your title. Should you ever decide to sell your vehicle, you will have verifiable proof that the lien has been legitimately terminated. You cannot transfer ownership of a vehicle until the lien is cleared from the title.

If you financed your vehicle with a lender that participates in Michigan's Electronic Lien and Title (ELT) program, your title record is held electronically, and you do not currently have a paper title showing a lien. Once the final payment on your loan has been processed by your lender you will automatically receive a paper title mailed to you from the Michigan Department of State. Please make sure to provide your lender with your current mailing address to ensure proper receipt of your paper title.

No. Don't assume a used vehicle has a manufacturer's or dealer's warranty. Most used vehicles are not under warranty for any period of time. Any vehicle sold "as is" carries no warranty. You must pay for any repairs on a vehicle not covered by a warranty.

If the seller promises to make repairs to get you to buy a vehicle, make sure you get the promise in writing.

Due to the implementation of the state's Electronic Lien and Title (ELT) system in March of 2021, your title will be held electronically by the Michigan Department of State.  This means you will not be receiving a paper vehicle title until your vehicle loan has been paid in full.  When you make the final payment to your lender, they will inform the Michigan Department of State to release a paper copy of your title, which will automatically be mailed to you.

Consumers should be aware that leasing may involve costs for excess mileage, early termination, or excess wear and tear. When you lease a vehicle, make sure all the terms of the lease are in writing, that you understand the terms of the lease and that you agree with the terms. More information about leasing may be found by reading the Secretary of State's Consumers Guide to Leasing .

If you are selling your vehicle and cannot find its title, you will need to get a duplicate title at a Secretary of State branch office.

As seller, complete your part on the title assignment by signing it and adding the:

• Vehicle mileage
• Selling date
• Selling price

Note: If there is more than one owner named on the front of the title, all owners must sign.

• Check if any liens (such as bank loans) against the vehicle that are noted on the title. If there is a lien, it must be released by the lienholder in the appropriate signature space. You also may attach a lien termination statement from the financial institution to the title.
• Have the buyer enter their name, address and signature in the buyer's section on the title document.
• If possible, the buyer and seller should go together to a Secretary of State office to complete the title transfer.

If you are unable to accompany the buyer, maintain a record of the sale for at least 18 months. The record can be a photocopy of the reassigned title or a form or document that includes the vehicle's year, make, and Vehicle Identification Number, as well as the name, address, driver's license number and signature of the person to whom the vehicle is sold along with its purchase price and date of sale.

Under Michigan law, a seller is not liable for any damages or a violation of the law caused by the buyer if the seller maintains proof of sale.

• Keep the license plate that was on the vehicle you sold.  You may transfer that plate to another vehicle.
• Remember to cancel your insurance on the vehicle that you sold.

Salvage vehicle agents licensed by the Michigan Department of State are the only persons authorized to buy or sell salvage or scrap-titled vehicles or major component parts at salvage pools or auctions in Michigan. A Salvage Vehicle Agent may represent only his/her dealership of employment when dealing in salvage or scrap-titled vehicles or salvageable parts.

• Test-drive the vehicle and have it inspected by a mechanic.
• Check the odometer's mileage accuracy. The mileage for most vehicles must be provided when ownership changes. Vehicles older than 10 years are exempt.
• Check the odometer's mileage accuracy. The mileage for most vehicles must be provided when ownership changes. Vehicles older than 10 years are exempt.
• Make sure the vehicle has a valid title and that the owner named on the front of the title is the same person signing it over to you.
• Match the Vehicle Identification Number (VIN) on the title with the number on the vehicle's dashboard. The VIN should be visible through the windshield.
• Check the title to be sure that there are no liens (such as bank loans) against the vehicle. If there is a lien, it must be released by the lienholder in the appropriate signature space or by attaching a lien termination statement from the financial institution to the title.
• Never take possession of a vehicle without the title signed by the owner or owners named on the front of the title. If more than one person is buying the vehicle, you all need to sign the new title application.
• If possible, the buyer and seller should go together to a Secretary of State office to complete the title transfer. The transfer must be filed with the Secretary of State within 15 days from the date of the sale to avoid a late fee. Unless exempt, tax is due when you apply for the title.

If you purchase or acquire a vehicle from another person, 6% tax is due of the full purchase price or fair market value, whichever is greater.   No tax is due if you purchase or acquire a vehicle from an immediate family member. An immediate family member is defined as:

• Parent (natural or adoptive)
• Brother or sister (includes half-brother and half-sister)
• Child (natural or adopted)
• Father-in-law, mother-in-law, brother-in-law, sister-in-law, son-in-law, daughter-in-law, grandchild-in-law
• Stepparent, stepbrother, stepsister, or stepchild*
• Grandparent or grandchild
• Legal ward, or legally appointed guardian with a certified letter of guardianship

*For tax purposes, a step-relationship ends upon divorce

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How To Navigate The Real Estate Assignment Contract

What is assignment of contract?

Assignment of contract vs double close

How to assign a contract

Assignment of contract pros and cons

Even the most left-brained, technical real estate practitioners may find themselves overwhelmed by the legal forms that have become synonymous with the investing industry. The assignment of contract strategy, in particular, has developed a confusing reputation for those unfamiliar with the concept of wholesaling. At the very least, there’s a good chance the “assignment of contract real estate” exit strategy sounds more like a foreign language to new investors than a viable means to an end.

A real estate assignment contract isn’t as complicated as many make it out to be, nor is it something to shy away from because of a lack of understanding. Instead, new investors need to learn how to assign a real estate contract as this particular exit strategy represents one of the best ways to break into the industry.

In this article, we will break down the elements of a real estate assignment contract, or a real estate wholesale contract, and provide strategies for how it can help investors further their careers. [ Thinking about investing in real estate? Register to attend a FREE online real estate class and learn how to get started investing in real estate. ]

What Is A Real Estate Assignment Contract?

A real estate assignment contract is a wholesale strategy used by real estate investors to facilitate the sale of a property between an owner and an end buyer. As its name suggests, contract assignment strategies will witness a subject property owner sign a contract with an investor that gives them the rights to buy the home. That’s an important distinction to make, as the contract only gives the investor the right to buy the home; they don’t actually follow through on a purchase. Once under contract, however, the investor retains the sole right to buy the home. That means they may then sell their rights to buy the house to another buyer. Therefore, when a wholesaler executes a contact assignment, they aren’t selling a house but rather their rights to buy a house. The end buyer will pay the wholesale a small assignment fee and buy the house from the original buyer.

The real estate assignment contract strategy is only as strong as the contracts used in the agreement. The language used in the respective contract is of the utmost importance and should clearly define what the investors and sellers expect out of the deal.

There are a couple of caveats to keep in mind when considering using sales contracts for real estate:

Contract prohibitions: Make sure the contract you have with the property seller does not have prohibitions for future assignments. This can create serious issues down the road. Make sure the contract is drafted by a lawyer that specializes in real estate assignment contract law.

Property-specific prohibitions: HUD homes (property obtained by the Department of Housing and Urban Development), real estate owned or REOs (foreclosed-upon property), and listed properties are not open to assignment contracts. REO properties, for example, have a 90-day period before being allowed to be resold.

What Is An Assignment Fee In Real Estate?

An assignment fee in real estate is the money a wholesaler can expect to receive from an end buyer when they sell them their rights to buy the subject property. In other words, the assignment fee serves as the monetary compensation awarded to the wholesaler for connecting the original seller with the end buyer.

Again, any contract used to disclose a wholesale deal should be completely transparent, and including the assignment fee is no exception. The terms of how an investor will be paid upon assigning a contract should, nonetheless, be spelled out in the contract itself.

The standard assignment fee is $5,000. However, every deal is different. Buyers differ on their needs and criteria for spending their money (e.g., rehabbing vs. buy-and-hold buyers). As with any negotiations , proper information is vital. Take the time to find out how much the property would realistically cost before and after repairs. Then, add your preferred assignment fee on top of it.

Traditionally, investors will receive a deposit when they sign the Assignment of Real Estate Purchase and Sale Agreement . The rest of the assignment fee will be paid out upon the deal closing.

Assignment Contract Vs Double Close

The real estate assignment contract strategy is just one of the two methods investors may use to wholesale a deal. In addition to assigning contracts, investors may also choose to double close. While both strategies are essentially variations of a wholesale deal, several differences must be noted.

A double closing, otherwise known as a back-to-back closing, will have investors actually purchase the home. However, instead of holding onto it, they will immediately sell the asset without rehabbing it. Double closings aren’t as traditional as fast as contract assignment, but they can be in the right situation. Double closings can also take as long as a few weeks. In the end, double closings aren’t all that different from a traditional buy and sell; they transpire over a meeter of weeks instead of months.

Assignment real estate strategies are usually the first option investors will want to consider, as they are slightly easier and less involved. That said, real estate assignment contract methods aren’t necessarily better; they are just different. The wholesale strategy an investor chooses is entirely dependent on their situation. For example, if a buyer cannot line up funding fast enough, they may need to initiate a double closing because they don’t have the capital to pay the acquisition costs and assignment fee. Meanwhile, select institutional lenders incorporate language against lending money in an assignment of contract scenario. Therefore, any subsequent wholesale will need to be an assignment of contract.

Double closings and contract assignments are simply two means of obtaining the same end. Neither is better than the other; they are meant to be used in different scenarios.

Flipping Real Estate Contracts

Those unfamiliar with the real estate contract assignment concept may know it as something else: flipping real estate contracts; if for nothing else, the two are one-in-the-same. Flipping real estate contracts is simply another way to refer to assigning a contract.

Is An Assignment Of Contract Legal?

Yes, an assignment of contract is legal when executed correctly. Wholesalers must follow local laws regulating the language of contracts, as some jurisdictions have more regulations than others. It is also becoming increasingly common to assign contracts to a legal entity or LLC rather than an individual, to prevent objections from the bank. Note that you will need written consent from all parties listed on the contract, and there cannot be any clauses present that violate the law. If you have any questions about the specific language to include in a contract, it’s always a good idea to consult a qualified real estate attorney.

When Will Assignments Not Be Enforced?

In certain cases, an assignment of contract will not be enforced. Most notably, if the contract violates the law or any local regulations it cannot be enforced. This is why it is always encouraged to understand real estate laws and policy as soon as you enter the industry. Further, working with a qualified attorney when crafting contracts can be beneficial.

It may seem obvious, but assignment contracts will not be enforced if the language is used incorrectly. If the language in a contract contradicts itself, or if the contract is not legally binding it cannot be enforced. Essentially if there is any anti-assignment language, this can void the contract. Finally, if the assignment violates what is included under the contract, for example by devaluing the item, the contract will likely not be enforced.

How To Assign A Real Estate Contract

A wholesaling investment strategy that utilizes assignment contracts has many advantages, one of them being a low barrier-to-entry for investors. However, despite its inherent profitability, there are a lot of investors that underestimate the process. While probably the easiest exit strategy in all of real estate investing, there are a number of steps that must be taken to ensure a timely and profitable contract assignment, not the least of which include:

Find the right property

Acquire a real estate contract template

Submit the contract

Assign the contract

Collect the fee

1. Find The Right Property

You need to prune your leads, whether from newspaper ads, online marketing, or direct mail marketing. Remember, you aren’t just looking for any seller: you need a motivated seller who will sell their property at a price that works with your investing strategy.

The difference between a regular seller and a motivated seller is the latter’s sense of urgency. A motivated seller wants their property sold now. Pick a seller who wants to be rid of their property in the quickest time possible. It could be because they’re moving out of state, or they want to buy another house in a different area ASAP. Or, they don’t want to live in that house anymore for personal reasons. The key is to know their motivation for selling and determine if that intent is enough to sell immediately.

With a better idea of who to buy from, wholesalers will have an easier time exercising one of several marketing strategies:

Direct Mail

Real Estate Meetings

Local Marketing

2. Acquire A Real Estate Contract Template

Real estate assignment contract templates are readily available online. Although it’s tempting to go the DIY route, it’s generally advisable to let a lawyer see it first. This way, you will have the comfort of knowing you are doing it right, and that you have counsel in case of any legal problems along the way.

One of the things proper wholesale real estate contracts add is the phrase “and/or assigns” next to your name. This clause will give you the authority to sell the property or assign the property to another buyer.

You do need to disclose this to the seller and explain the clause if needed. Assure them that they will still get the amount you both agreed upon, but it gives you deal flexibility down the road.

3. Submit The Contract

Depending on your state’s laws, you need to submit your real estate assignment contract to a title company, or a closing attorney, for a title search. These are independent parties that look into the history of a property, seeing that there are no liens attached to the title. They then sign off on the validity of the contract.

4. Assign The Contract

Finding your buyer, similar to finding a seller, requires proper segmentation. When searching for buyers, investors should exercise several avenues, including online marketing, listing websites, or networking groups. In the real estate industry, this process is called building a buyer’s list, and it is a crucial step to finding success in assigning contracts.

Once you have found a buyer (hopefully from your ever-growing buyer’s list), ensure your contract includes language that covers earnest money to be paid upfront. This grants you protection against a possible breach of contract. This also assures you that you will profit, whether the transaction closes or not, as earnest money is non-refundable. How much it is depends on you, as long as it is properly justified.

5. Collect The Fee

Your profit from a deal of this kind comes from both your assignment fee, as well as the difference between the agreed-upon value and how much you sell it to the buyer. If you and the seller decide you will buy the property for $75,000 and sell it for $80,000 to the buyer, you profit $5,000. The deal is closed once the buyer pays the full $80,000.

Assignment of Contract Pros

For many investors, the most attractive benefit of an assignment of contract is the ability to profit without ever purchasing a property. This is often what attracts people to start wholesaling, as it allows many to learn the ropes of real estate with relatively low stakes. An assignment fee can either be determined as a percentage of the purchase price or as a set amount determined by the wholesaler. A standard fee is around $5,000 per contract.

The profit potential is not the only positive associated with an assignment of contract. Investors also benefit from not being added to the title chain, which can greatly reduce the costs and timeline associated with a deal. This benefit can even transfer to the seller and end buyer, as they get to avoid paying a real estate agent fee by opting for an assignment of contract. Compared to a double close (another popular wholesaling strategy), investors can avoid two sets of closing costs. All of these pros can positively impact an investor’s bottom line, making this a highly desirable exit strategy.

Assignment of Contract Cons

Although there are numerous perks to an assignment of contract, there are a few downsides to be aware of before searching for your first wholesale deal. Namely, working with buyers and sellers who may not be familiar with wholesaling can be challenging. Investors need to be prepared to familiarize newcomers with the process and be ready to answer any questions. Occasionally, sellers will purposely not accept an assignment of contract situation. Investors should occasionally expect this, as to not get discouraged.

Another obstacle wholesalers may face when working with an assignment of contract is in cases where the end buyer wants to back out. This can happen if the buyer is not comfortable paying the assignment fee, or if they don’t have owner’s rights until the contract is fully assigned. The best way to protect yourself from situations like this is to form a reliable buyer’s list and be upfront with all of the information. It is always recommended to develop a solid contract as well.

Know that not all properties can be wholesaled, for example HUD houses. In these cases, there are often anti-assigned clauses preventing wholesalers from getting involved. Make sure you know how to identify these properties so you don’t waste your time. Keep in mind that while there are cons to this real estate exit strategy, the right preparation can help investors avoid any big challenges.

Assignment of Contract Template

If you decide to pursue a career wholesaling real estate, then you’ll want the tools that will make your life as easy as possible. The good news is that there are plenty of real estate tools and templates at your disposal so that you don’t have to reinvent the wheel! For instance, here is an assignment of contract template that you can use when you strike your first deal.

As with any part of the real estate investing trade, no single aspect will lead to success. However, understanding how a real estate assignment of contract works is vital for this business. When you comprehend the many layers of how contracts are assigned—and how wholesaling works from beginning to end—you’ll be a more informed, educated, and successful investor.

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Title Tip: Do Your Homework on Assigning Contracts

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Assignment of a real estate contract is looked upon with suspicion by lots of folks. While it is not legal in all states, under Texas law, contracts are assignable unless there is a specific clause in the contract that prohibits it.

There are some sellers who become upset when they discover that the person buying their property is not really the person buying their property. That their buyer has sold the right to purchase the home to someone else at a higher price.

Assignment of a contract is when someone enters into a written agreement to purchase a property from a seller and then that person assigns their interest to someone else. Typically, this is done when the original purchaser is a wholesaler. We will call them the Assignor. They find a property, put the property under contract and then find someone else (an Assignee) to whom they sell the contract for a fee.

The Assignor hands off the contract’s benefits to the Assignee while the property is still under contract. They may do this without the consent of the seller. But … there’s always a but.

While the Assignor may sell his or her rights in the contract to an Assignee, it does not relieve the Assignor of his or her duties and obligations. The Assignor still has responsibilities to the seller under the terms of the contract. If the Assignee doesn’t perform under the contract, then the Assignor is in default. The Assignor usually maintains obligations under the contract. This is where you contact a real estate attorney if you have an issue.

Some people view the business of a real estate wholesaler as shady. They don’t like the idea of someone ‘flipping’ the contract for a higher price. However, wholesalers earn their living by legitimately finding bargains and reselling them at a profit. They usually target rundown or distressed properties. Then they find buyers who may be looking to remodel or flip the property. Like anyone, they do it to earn a profit.

Maybe the disdain is because the wholesaler doesn’t actually purchase the home. They’re a middleman. Folks who oppose the idea of assigning a contract feel that the purchaser should only enter into a contract to purchase a property if they honestly intent to purchase the property.

Since anyone being paid in the transaction must be disclosed on the closing statement, the seller can see that there is another buyer paying more for the property. That doesn’t usually happen until closing time. Then money and the property changes hands. The buyer is the Assignee. The Assignor never takes title or possession of the property.

The Buyer/Assignee may then rehab the property and resell it. Like a board game, the property then passes to someone else.

The opinions expressed are of the individual author for informational purposes only and not for the purpose of providing legal advice. Contact an attorney to obtain advice for any particular issue or problem.

Lydia Blair (formerly Lydia Player) was a successful Realtor for 10 years before jumping to the title side of the business in 2015. Prior to selling real estate, she bought, remodeled and sold homes (before house flipping was an expression). She’s been through the real estate closing process countless times as either a buyer, a seller, a Realtor, and an Escrow Officer. As an Escrow Officer for Allegiance Title at Preston Center, she likes solving problems and cutting through red tape. The most fun part of her job is handing people keys or a check.

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CandysDirt.com welcomes articles and op-eds from our readers and brand partners. Think you have a great story to tell? Send us a note at [email protected] .

Great article Lydia!!! So many agents think that the Buyer on a contract must have “AND/OR ASSIGNS” at the end of the Buyer’s name for a contract to be assignable but that is simply NOT true. Contracts are assignable unless the contract specifically prohibits it!

Great article, Lydia! The wholesale market is very active in DFW. Almost every investment group I know teaches it as a method to make a profit. I’ve seen MLS listed properties come across through my inbox as investor “deals”. Realtors and Investors alike – Do your research!

Great real world example and explanation of when assignment happens in Texas Real Estate, thank you!

In the original purchase agreement there was mention of a survey alta and title report. Each stated 10 days for review. It stated it would be ordered then buyer pays. In the assignment contract it states under Florida laws. But the deal is in Texas. The buyer in the assignment wants to see the survey and the title, do they have the right so see those?

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