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What the New Title Transfer Rules Mean for Texas Dealers

Senate Bill 876, which passed out of the 87th Legislative Session, cleared the way for dealers to transfer and register vehicles in any county in the state. TIADA worked hard to help SB 876 through the legislative process and had numerous conversations with members of the legislature in an effort to get relief for Texas dealers.

This is a law many dealers in Texas applauded hoping it would address some of the long lines and wait times at the tax office in their local counties. But, as always, there is more to the law than that. Before you trek out to a neighboring county, make sure you understand the entire law.

Eliminating VTR-136

We will discuss transferring in other counties in a bit. The first thing you need to know about this new law is dealers are no longer required to have each customer complete the form VTR-136 (county of issuance).

This not only eliminates one more piece of paper in the deal jacket and at the time of closing, but it allows dealers to efficiently title and transfer vehicles in the county of their choice. This is, as long as the dealer is making an application for title and registration in the county in which the owner resides, the motor vehicle is purchased or is encumbered the tax assessor must accept the transfer.

Detailed information about the implementation of SB 876 (including the elimination of VTR-136) can be found in this useful sheet from TxDMV.

Registering in Other Counties

But what about other counties? A new part of this law adds an additional section when a dealer is making an application for registration.

An application for title may be filed with the county tax assessor-collector in the county in which:

·      the owner resides;

·      the motor vehicle is purchased or encumbered; or

·      a county tax assessor-collector who is willing to accept the application.

The last bullet is the new section, and it gives authority to the tax assessor in each county to decide if accepting outside applications for title and registration makes sense in their county. Not all counties will land in the same place and it's too early to say which counties will look for more applications. TIADA will continue to work with tax assessors as they weigh the pros and cons of accepting outside applications and keep you informed of any tax office willing to accept the application.

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