Last Updated on December 19, 2020 by Joe Regan
Howdy, Driver? What is title jumping? Title jumping, also called title floating or skipping, is the act of purchasing and selling a vehicle without putting it in your name (not registering the vehicle).
A jumped title passes the ownership of a car from one person to another without any record of ownership.
Typically, title jumping is an illegal practice by a vehicle dealer that wants to avoid taxes on the car. Currently, several person title float not just to exempt taxes, but for various other reasons that may include not having to visit the motor agency or paying registration fees.
Is title jumping illegal
Yes, title jumping is illegal across all the states. Typically, people jump, skip or float titles to avoid sales tax, registration fee, and other applicable taxes. Of course, it is illegal to evade taxes, especially if you do not follow legal procedures.
Moreover, criminals use title jumping to sell stolen cars comfortably.
If you buy a car today and wish to sell it tomorrow, you must transfer the title into your name before signing over to the new owner; otherwise, you are being fraudulent, according to the law.
An exception applies, for instance, if the owner of the car is deceased and the next of kin is willing to sell the car. You would need the death certificate as proof to complete signing over the title in your name.
The Difference Between Title Jumping and Title Skipping
Somehow, a jumped title is different from a skipped title. In a skipped title, the seller and the first buyer of the vehicle fill out their information but they do not inform their state by registering the car properly and transferring the title before selling the car again.
The Problem of Title Jumping to Sellers
If you sell a vehicle without transferring the title in your name, you are jumping title or title floating.
Typically, when you acquire a car, most states give a window period which you can use to register and put a car title in your name.
When you do not transfer the title of the car in your name before selling it, somehow, you are not the registered owner of the car. The reason is obvious; the car is not registered in your name, so, you cannot sell the car and transfer ownership legally.
If you are caught title jumping, you would be charged with a felony. And if you want to sell a car that is not in your name, you have to put the car in your name before you can sell the car legally. Otherwise, you are exempting taxes, which is illegal in all states.
The Problem of Title Jumping to Buyers
It is not advisable to buy a car from someone if the car is not registered in their name considering the tedious processes you would have to follow and the amount of money you will spend to transfer the ownership of the car before you put it in your name.
If you buy a title jumped or title floated vehicle, expect to go through a lengthy process with the seller/registered owner of the car.
As someone buying a title jumped car, you do not know the number of persons that owned the car previously, thus, some of the damaging issues with the car are concealed from you.
If you have no access to the seller or registered owner (original title owner) of the car with floated title, you would find yourself unsure of what to do.
What Happens if You Buy a Title Jumped Vehicle?
If you buy a vehicle with a jumped title, you will have difficulties registering it in your name, not to mention being able to locate the last person whose name is on the title.
As a rule of thumb, before you pay for a vehicle, make sure the name of the seller is on the title certificate of the car. However, if the person signing over the car title to you as a buyer has power of attorney over the person on the car title, you can proceed with the transaction, but you must obtain proof of the power of attorney.
To transfer the ownership of the car, the power of attorney would be required to register and put your name on the title.
If a seller tells you that they lost the title of the car, it could be a trick to get away with selling you a title jumped car.
Tell the seller to request a duplicate title or power of attorney at least for you to follow due process to register the car in your name.
If the seller cannot provide you with the title of the car, do not buy the car.
What If You Are The Victim Of Title Jumping
If you bought a vehicle recently and the name of the seller is not on the car title, you could do a few things to fix the situation.
First, if you bought the car from a private seller, ask the seller to transfer the title of the car into their name and sign over the new title to you. If the seller cannot transfer the title into their name, probably because they cannot locate the person with the name on the title, you may have to withdraw from the deal.
Secondly, if a dealership sold the jumped title car to you, file a claim against them for fraud or request a refund.
Thirdly, you have to get a bonded (if possible) if none of the fixes above does apply to you.
Getting a bonded title is not always a solution, especially if your state does not recognize bonded titles. Therefore, you should look up the website or contact the title department of your state to confirm whether a bonded title is recognized.
A bonded title is also called a Certificate of Title Surety, it helps you to deal with title jumping or title floating or title skipping. And in some cases, a bonded title may be used to replace a missing car title.
A bonded title is similar to the traditional car title in appearance, however, it carries the “BONDED” brand.
In some states, you may be able to remove the bonded brand from the title certificate after you possess the vehicle for at least 3 years without a problem.
To obtain a bonded title as a solution to title jumping, you will buy a Lost Title Bond.
States That Don’t Allow Bonded Titles
Unfortunately, not all states allow bonded titles. The states that do not allow for a bonded title are Delaware, Kansas, Kentucky, Louisiana, Maryland, New Jersey, North Dakota, Oklahoma, Oregon, Pennsylvania, South Carolina, South Dakota, and Virginia.
Bonded titles are known differently (or better still do not accept a bonded title) in Ohio and Indiana, they are recognized as Court-Ordered titles.
Why Do People Jump Or Skip Car Titles?
Typically, when people flip cars, they will likely jump car titles to avoid paying the fees for registering the car with the DMV. Title jumping also allows people to evade sales tax and save more money when selling cars.
Before now, title flipping was a practice confined to car dealerships that intend to cut the cost of selling cars and increase profit.
However, unlicensed vehicle sellers have joined in the trend to flip cars, jump titles, and save more money.
The unlicensed seller signs up for an e-market such as Craigslist or eBay, they make cash offers to sellers that are desperate to sell used cars, and they acquire the cars for a bargain.
Since they are operating as title flippers, they do not get to register the used car, thus jumping title, and they save the massive amount from evading registration fees and applicable taxes.
In essence, people skip titles to evades sales tax, the tedious registration process, and other applicable taxes.
In some cases, criminals employ title jumping to get away with stolen cars. For instance, when they steal a car, they do not have to register the car in their name, or they may get caught.
Can you go to jail for Title jumping?
Yes, you can go to jail for title jumping because it is a felony and it is an illegal activity across the states. But there is an exception if the owner of the car is deceased and the family intends to sell the car. You would require the death certificate as proof to get the car registered in your name.
Can you sue someone for Title jumping?
Yes, you can sue someone for title jumping if they refuse to refund or get a title transfer in their name and sign it over to you. If you bought the car from the dealership, you can ask for a refund or sue the business for fraud if they fail to rectify the issue.