What is an Electronic Title Transfer?

In a world of instantaneous transactions, why should transferring your car title stay in the stone age? Electronic title transfers are changing the game in some states. We predict they’ll be the norm before long.
While traditional paper titles aren’t going away in the foreseeable future, electronic titles do have a certain convenience.

Let's look at the pros and cons of electronic title transfers.

What is Electronic Lien and Title?

The Electronic Lien and Title (ELT) system is a method of digitally managing vehicle titles and lien information. The ELT program is individually managed at the state level by participating states and their respective DMV (or equivalent vehicle registry agency).

An ELT has two primary components:

1. Title: this is the legal document that establishes a person or entity as the legal owner of a vehicle. When a vehicle is bought or sold, the title must be transferred to the new owner.
2. Lien: when you finance a vehicle, the lender, also known as the lienholder, has a legal claim or "lien" on the vehicle until the loan is fully paid off. The lienholder is typically a bank, credit union, or finance company. In a traditional, paper-based system, the title is held by the lienholder until the loan is paid off. This can lead to delays and potential errors when the lien is released and the title is transferred to the owner.

With an ELT, the title information and the lien information are all managed electronically. When a vehicle is financed, the lien is noted electronically on the title. Once the loan is paid off, the lienholder can electronically release their lien. The title can then be electronically transferred to the owner, or if the vehicle is sold, to the new owner.

Which States Offer Electronic Lien and Title?

There is a spectrum of ELT adoption across the 50 states. States fall into one of 3 categories.

1. ELT only
2. Accept both ELT and paper titles
3. No ELT (yet)

States That Accept ELT Only

The following states have fully implemented an electronic lien and title program, to the point that ELT is required:

North Carolina
South Carolina

States That Accept Paper Titles and ELT

The following states allow drivers to choose between paper title and ELT.

New York
South Dakota
West Virginia
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States That Accept Paper Titles Only

The following states lag behind in ELT adoption; they currently don’t participate in any ELT program:

New Hampshire
New Mexico
North Dakota
Rhode Island

States That Plan to Accept ELT in the Future

The following states are slated to adopt an ELT in 2023-2024:

New Jersey

How Does an ELT Title Transfer Work?

An electronic lien and title transfer takes place digitally; here’s how the process goes:

1. Payoff of the loan: when a car owner pays off their vehicle loan, the lienholder (the finance company or bank) is notified.
2. Lien release: upon receiving the notification, the lienholder electronically submits a lien release to the appropriate state's Department of Motor Vehicles (DMV) or equivalent vehicle registry agency. This action removes their claim on the vehicle.
3. Update of title: the DMV updates the title information to reflect the release of the lien. The title status now indicates that the vehicle is free of liens.
4. Ownership transfer: if the owner decides to sell the vehicle, they can initiate the transfer of the electronic title through the DMV's system. The DMV will update the title information to reflect the new owner's details.
5. New lien (if applicable): if the new owner buys the vehicle with a loan, their lender will file a new lien, and the process starts again.

Benefits and Downsides of E Titles

The biggest benefit of an electronic title is that it’s fast. You don’t need to wait for a paper title to arrive in the mail. E-titles can be verified quickly, expediting the entire process.

ELT Advantages


How Do You Buy a Car with an E Title?

When it comes to buying a used car from a private party, there’s a spectrum of ELT adoption. In some states, you can digitally transfer the title, but this is not always the case. To be sure, check your state's DMV website.

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Electronic Title Transfer FAQ

Which states don't offer the ELT program?

The electronic lien and titling (ELT) program is not supported in the following states:

1. Arkansas
2. Connecticut
3. Kentucky
4. Maine
5. Minnesota
6. Mississippi
7. Missouri
8. Montana
9. New Mexico
10. North Dakota
11. Oregon
12. Rhode Island
13. Tennessee
14. Utah
15. Wyoming

What is an eLien?

How does an electronic title work in Texas?

How do I get a paper copy of my electronic title in Florida?

What is an electronic title transfer in North Carolina?

How do you sell a car with an e-title?

How do I transfer a vehicle title online in Arizona?

What is Real ID and how does it relate to electronic titles?

Can I get temporary license plates online?

What is the process of purchasing a used car in South Carolina?

Do electronic titles meet insurance requirements?

How do I release a lien on an electronic title?

Was the ELT created by the federal government?

What is USA ELT?