What Is a Clean Title?

The job ain’t over until the paperwork is done. Questionable grammar aside, it is a phrase that can apply to many endeavors, and transferring ownership of a car is certainly one of them. The title is the document that makes car ownership official. It doesn’t matter if you paid the money; the vehicle is not officially yours if the title isn’t in your name. There is, however, more than one kind of title, and this Alderman Automotive post seeks to sort out the differences.  

In Indiana, the Bureau of Motor Vehicles (BMV) handles all vehicle titles, including those transferred from one private party to another. The most common phrase regarding this subject is “clean title,” which is the term you want to hear regarding any model you are considering.  

Clean Title 

A clean title indicates that the vehicle has not suffered significant damage tantamount to a “total loss.” The current owner also owns the car “free and clear,” which is to say there is not a lien on the vehicle. To be more specific, there are no outstanding loans on the vehicle for which it has served as collateral. The owner has full ownership and is thus able to sell the car with no complications. The vehicles you find at Alderman Automotive will have clean titles.  

Lienholder Title 

When you purchase a new or used vehicle with financing, what you get is a lienholder title. The is both yours and the lienholder’s, whose name will also be on the title and will be until the vehicle is paid off. When the loan is paid off, a “release of liability” form is to be submitted by the financer to BMW, after which a clean title is sent to the owner. When a vehicle is sold in which the owner owes money, the money must first go to the lienholder. A mechanic’s lien can refer to a vehicle that was towed or repaired but then abandoned by the vehicle owner. In Indiana, this will only apply to vehicles with a NADA average/clean title retail value of over $3,500. 

A further complication can arise if the owner is not that far into a fairly long-term loan. It is entirely possible that the vehicle’s market value is less than what is still owed. The seller must make up the difference before the vehicle can be transferred. If you purchase from a private party, you will want to know everything in advance. 

Salvage Title 

This is usually given to a vehicle that has been in an accident and is considered a “total loss” by the company insuring the vehicle. This is not limited to traffic accidents. Flood, fire, or other forms of damage can lead to a salvage title. Often, a vehicle can be considered a “total loss” or simply “totaled” by an insurance company when repairs equal or exceed 75% of the vehicle’s NADA average/clean title retail value. 

Rebuilt Title 

 A vehicle has a rebuilt title when it has been damaged to the extent that it was declared a “total loss” by a car insurance company but subsequently repaired to proper working order. Because “total loss” is based on the repair percentage of the vehicle’s value prior to the damage, the older a vehicle is, the less damage it takes to be declared totaled. The vehicle may have been restored well and continue to operate well, but the rebuilt title serves as a warning to the buyer that the car has notably experienced damage in the past.  

Branded Title 

Branded title is an umbrella term for anything other than a clean title. This includes the salvage and rebuilt titles mentioned above. It could also apply to a vehicle that was known to have its odometer turned back. Once a vehicle has a branded title, it stays with that vehicle for life, as it is an unalterable part of the vehicle’s history. 

Be Title Worry-Free at Alderman Automotive 

Branded titles are not a concern when shopping at Alderman Automotive. Vehicle liens are resolved before we put any vehicle on the market, and we don’t sell vehicles with branded titles. Also, the title transfer for any vehicle you buy will be handled by the Alderman Automotive staff. They are very familiar with the process, do it every day, and require little more effort from you than writing your signature on your clean title.

Make your next used car purchase as easy and reassuring as possible by shopping at Alderman Automotive. View our vast inventory, filter it down to the type, age, and models in which you are interested, visit for a test drive, view the Carfax history, and leave all the paperwork to us.