Final Step of Vehicle Purchase Going Digital for Good

If you came to me on any average day and told me that registration and titling was complex, I would say you were probably right.

Now consider how this complexity is amplified given our current environment. Dealerships across the nation have had to rethink how they sell cars as social distancing mandates have put us in what feels like a constant state of limbo. Additionally, over the past few weeks, more than 40 states have ordered significant changes to their department of motor vehicle standard operating procedures.

Take this fluid situation and multiply it by 51 unique DMV jurisdictions, 100 distinct sets of taxes and fees, 250 unique forms, and 300 possible registration and title transactions and you have a new beast altogether

Which DMVs are expanding their digital capabilities? Which offices are closed? What about states where counties have a role in title processing? The questions are endless.

Navigating this challenging climate will require closely monitoring each DMV on a state by state and sometimes even county basis to understand how each office will handle various transaction types as they adjust to today’s new reality.

The good news is that there has been no significant disruption to electronic registration and title (ERT) and electronic lien and title (ELT) processing, as maintaining DMV systems are considered an essential function.

But here is where it gets tricky. In states where counties have a role in title processing, if the county is closed and no electronic solution exists, paperwork may not be able to be processed during this time.

Today, more than 30 states are ERT-enabled and 24 are ELT-enabled. To put it simply, with ERT, dealers can submit completed transactions to the DMV and finalize deals electronically, while ELT replaces the issuance of a paper title with an electronic lien notice.

On top of this, at least 12 states currently accept or are legislatively permitted to accept some or all title documents with an e-signature, including Florida, Massachusetts, Michigan, North Carolina and Virginia.

These solutions are helping to ensure aspects of title, registration and lien processing can continue despite DMV closures and ongoing uncertainty throughout the industry.

Meanwhile, in California, field offices temporarily closed to the public on March 27 and re-opened virtually on April 2. Around this same time, DMV employees across the state started training on the DMV Virtual Field Office, which began in a limited pilot on March 23.

Through the Virtual Field Office, residents can complete select transactions that would have traditionally required an in-person office visit, such as vehicle-title transfers and complex vehicle registration renewals, by virtually interacting with DMV staff.

While DMVs will slowly re-open their office doors, a digitally enhanced registration and titling process is here to stay.

In fact, even before the coronavirus pandemic spiked demand for a more virtual way of working, registration and titling had already started to undergo digital transformation to help alleviate an often time-consuming and confusing process. From expediting payoff and title release for vehicles taken in on trade to simplifying the out-of-state workflow through tailored checklists, deal comparison tools and real-time fee calculations, registration and titling is moving in the same direction as the virtual world we now live in.

In the fall of 2019, for example, the National Highway Traffic Safety Admin. adopted a final rule permitting states to adopt and allow electronic odometer disclosures during a vehicle transfer.

Prior to this ruling, odometer disclosures were required to be completed on paper with handwritten names and wet signatures. Each state now has the authority to implement electronic odometers, which has long been viewed as the barrier to moving to an all-electronic/digital title.

This is a significant step forward for the industry, which has been held back by paper for far too long. Dealers should keep a watchful eye on how their state – and any other state they operate in – chooses to incorporate this new rule into their electronic titling systems.

We are all living in a new world order and each state DMV is working hard to adapt accordingly. The accelerated shift online has been unprecedented and is only helping speed up the digitization of the registration and title process further.

Kait Gavin_2_0

It is time to introduce some certainty amid these uncertain times and that is the digital future of registration and title.

Kait Gavin is vice president of operations for Dealertrack Titling Solutions.