February Title Processing Sara Oguin sara oguindaimler com

February Title Processing Sara Oguin sara. oguin@daimler. com February 2020 1

Legislative Update John Yarbrough jcyarbrough@pdpgroupinc. com February 2020 2

Legislative Tip of the Month Finding the Effective Date…. . sometimes at the beginning, at the end or not • SYNOPSIS • Requires secured party to deliver motor vehicle certificate of ownership by certified mail. • • CURRENT VERSION OF TEXT • Introduced Pending Technical Review by Legislative Counsel. • • AN ACT concerning the delivery of certificates of ownership and amending R. S. 39: 10 -10. • • BE IT ENACTED by the Senate and General Assembly of the State of New Jersey: • • 1. R. S. 39: 10 -10 is amended to read as follows: • 39: 10 -10. When the contract or terms of the security agreement noted on the certificate of origin [, ] or certificate of ownership have been performed , the seller or secured party shall deliver by certified mail, return receipt requested, to the buyer the certificate of ownership thereto, executed as provided in this chapter, with proper evidence of satisfaction of the contract or termination of the security interest. Within 15 days after the performance of the contract or termination of the security interest, the seller or secured party shall file with the [director] chief administrator a notice, in [such] a form as the [director] chief administrator shall prescribe, containing evidence of [such] the performance or termination. The [director] chief administrator shall thereupon cause a notation to be made on his records of certificate of ownership of the motor vehicle that the contract has been satisfied or the security interest terminated. • Any person violating the provisions of this section shall pay a fine of [$25. 00] $25. • (cf: P. L. 1961, c. 122, s. 4) • • 2. This act shall take effect on the first day of the seventh month after enactment. • Legislative Committee 3

Introduced Legislation Kentucky HB 145 The bill requires delivery of a motor vehicle title upon which there is a security interest to the holder of the security interest rather than the owner of the vehicle; amend KRS 186. 045 to require the holder of a security interest who has possession of a vehicle title to transmit that title to the owner when the security interest has been paid in full; set forth procedures for cases when the title is not transferred; amend KRS 186 A. 180, 186 A. 190, and 186. 170 to conform. Effective: Unknown https: //apps. legislature. ky. gov/record/20 rs/HB 145. html New Jersey AB 1480 The bill requires secured party to deliver motor vehicle certificate of ownership by certified mail. Effective: First day of the seventh month of passage https: //www. njleg. state. nj. us/bills/Bill. View. asp? Bill. Number=A 1480 Legislative Committee 4

Introduced Legislation New Jersey AB 1483 This bill requires motor vehicle dealers to pay the remaining loan on a customer’s trade-in within 15 days of accepting that trade-in. The bill also requires the dealer to provide proof of the payment to the customer upon request. In addition, the bill requires a secured party to release the title within 15 days of receipt of payment from the motor vehicle dealer. When the balance is paid by noncertified check, the secured parties are required to release the title within 15 days from the date the check is credited to their account. A secured party who fails to comply with these time requirements is to be subject to a civil penalty of up to $500 for the first offense and up to $1, 000 for each subsequent offense. (Formerly, A 590 last session) Effective: First day of the third month following enactment https: //www. njleg. state. nj. us/bills/Bill. View. asp Maine LD 83 A vehicle that is sold by a dealer must be accompanied by a properly assigned and valid certificate of title or certificate of salvage or a copy of a valid certificate of title at the time of its sale. A dealer may retain and process certificates of title and certificates of salvage at the dealer’s primary facility if in the case when the dealer displays a vehicle at an annex facility the dealer maintains a copy of the certificate of title or certificate of salvage at the annex facility. Effective Date: Unknown http: //legislature. maine. gov/Law. Maker. Web/summary. asp? ID=280070775 Legislative Committee 5

Introduced Legislation Maryland SB 134: The bill requires the dealer to present a paper copy the electronic installment agreement prior to the sale of the vehicle. Effective: October 1, 2020 http: //mgaleg. maryland. gov/mgawebsite/Legislation/Details/sb 0134/? ys=2020 RS Iowa SB 3022: The bill adapts the new NHSTA requirements; removes the GVWR requirements Effective: January 1, 2021 https: //www. legis. iowa. gov/legislation/Bill. Book? ga=88&ba=SSB+3022 Mississippi SB 2099: The law allows for a plate transfer on a totaled vehicle. If the DMV is satisfied that a vehicle is totaled, the State will issue a salvage title and/or a branded title. Effective: Upon passage http: //billstatus. ls. state. ms. us/2020/pdf/history/SB/SB 2099. xml Legislative Committee 6

Introduced Legislation Oklahoma SB 1460 provides for holders of a perfected security interest in a vehicle to be the holder of certificate of title in the collateral. The measure also provides for the Oklahoma Tax Commission to issue a new certificate of title to the holder of a perfected security interest in a vehicle. Effective January 1, 2021 http: //www. oklegislature. gov/Bill. Info. aspx? Bill=SB 1460&Session=2000 Legislative Committee 7

ELT Subcommittee Update Sarah Hunsicker February 12, 2020

Proposed CA Electronic Lien & Title (ELT) Regulations On Friday January 10 the California Department of Motor Vehicles (DMV) posted proposed Mandatory Electronic Lien & Title (ELT) Regulations. More information regarding this regulatory activity can be found here: https: //www. dmv. ca. gov/portal/dmv/detail/about/lad/regactions. New Requirements • Requires lien holder’s title information to be kept in electronic format via the department’s Electronic Lien & Title (ELT) Program. • Creation of a Lien Holder Permit required by a lien holder to operate in the ELT Program • As part of the Lien Holder Permit Application Process, the applicant (lien holder) must submit • For each of their designated employees, a completed and signed Electronic Lien and Title (ELT) Program Information Security and Disclosure Statement Service Provider/Lienholder Employee form, REG 677 (NEW 1/2019) • “Designated employee” means any employee who has been identified by an Electronic Lien and Title Program participant. • This form outlines the user’s responsibilities for the handling and protecting of CADMV information. • Employee Signature Required ELT Subcommittee Update - Feb 2020

Proposed CA Electronic Lien & Title (ELT) Regulations • Recommended Next Steps o All Lien Holders should review the Proposed Regulations, including all documents incorporated by reference to ensure a comprehensive understanding off all new changes/potential impacts. o Determine whether NTSF should provide formal comments in response • Written comments regarding the proposed regulations can be submitted to the department through February 25, 2020 ELT Subcommittee Update - Feb Texas 2020 May 7 -9, 2019 Grapevine,

Committee Issues All Participants February 2020 11

Committee Issues o TN – Dept of Revenue/County Clerk participation in Plenary meeting o KY/OK – rumor going to require title sent to lien holder, change to title holding • Provide comment to states? o CA- mandatory ELT • Concerns? o Information security requirements imposed by states o VA Helds, can VA stop sending a feed until a title is actually issued. o 2 nd liens with FL without permission (example Mariners). o Lack of notification from non-titling states when changes are made. o Continue to have issues in states that use the title app vs the title or MSO when determining ownership. January 2020 12

Committee Issues o Resources for proper and safe storage of titles – James Wardrop, Credit Acceptance o Is there a need to retain copies of executed titles and lien releases? – Tricia Walker, Capital One o Title release issues concerns in the following states – Dawn Moore, Bo. A • Changes coming with AZ and limited options to release. • SC release law • NY why does NY require a lien release in addition to releasing the lien notice. o Any problems or issues with ELT transactions or specific states, Dawn Moore, Bo. A • Address space limitations • Limited ELT codes available per Fed ID. Should be based on address, not only Fed Id. • Receiving feed when ELT has not been issued. January 2020 13

Committee Issues o Concerns with Title Maintenance process (state to state, name change, etc. ), Dawn Moore, Bo. A • Non-titling states not requiring lien holder permission to complete transfer or registration. o IL ERT notification of hold issue, Devin Sheffield, Prestige Financial • Placing title work holds on things submitted by dealerships incorrectly but are notifying the lienholder or the dealership that they are missing documents. The title work is being placed on hold rather than being rejected. Did something change with IL that the dealerships are no longer getting notified? Are other lenders experiencing similar issues? o NM issue with stickers on titles - Joyce Gwatidzo, Capital One • We've been receiving rejects from NM due to the stickies that the title vendors place on the titles. I believe they use these stickies for tracking purposes or something, but is it possible for them to place the stickies on the back of the title or maybe another option that does not go against the NM DMV's attached policy? January 2020 14